- "In this challenging business environment, the bank's operations and result developed positively. The good growth seen in customer business and customer numbers is particularly satisfying. Our good performance means record customer benefits for our customers," says Olli Lehtilä, Managing Director of OP Uusimaa.
OP Uusimaa’s key figures and ratios for January–March 2024:
- OP Uusimaa's January–March 2024 operating profit was EUR 58 million (EUR 40.1 million).
- Financing operations (loans from own balance sheet and mediated loans) increased by 0.5% from the beginning of the year to EUR 16.9 billion.
- Customer assets (deposits, insurance assets, mutual fund units, Profit Shares and index-linked bonds) increased by 3.1% from the beginning of the year to EUR 18.6 billion.
- The number of owner-customers increased in January–March 2024 by 3,423 customers, totalling 365,519 at the end of March.
- Owner-customers earned EUR 15.7 million in OP bonuses, up by 21% year over year.
- The NPS, which measures customer experience, was good at 78.
- Common Equity Tier 1 (CET1) capital ratio stood at 17.9% (16.5) at the end of March.
- Non-performing exposures remained low, accounting for 2.8% (1.6) of total exposures.
OP Uusimaa's market share of home loans in Finland continued to increase
The housing market continued to be muted in the first quarter. In January–March 2024, the number of home loan applications received by OP Uusimaa was down by 5%, the volume of home loans drawn down decreased by 7%, and the number of homes sold via OP Koti Uusimaa declined by 28% year over year.
OP Uusimaa’s home loan portfolio grew by 0.2% from the beginning of 2024, totalling EUR 11.0 billion at the end of March.
OP Uusimaa's market share in home loans continued to increase in the first quarter of 2024, accounting for 10.3% (10.0) of total home loans in Finland at the end of March. In January–March 2024, OP Uusimaa accounted for 34.6% (35.1) of new home loans granted by OP Financial Group and for 13.5% (14.7) of total new home loans in Finland.
"The housing market has cooled down more in Uusimaa than elsewhere in Finland. Nevertheless, our importance as a home loan provider strengthened, and OP Uusimaa's market share continued to increase," Olli Lehtilä says.
Slow period in corporate financing – demand for housing company loans
At OP Uusimaa, the demand for corporate financing remained subdued in the first quarter. The volume of new corporate and institutional loans drawn down in January–March 2024 decreased by 9.6% year over year. The corporate and institutional loan portfolio (own balance sheet) increased by 1.6% from the beginning of the year.
"The uncertain economic outlook has a significant impact on companies' interest in investing, and results in modest demand for loans," Olli Lehtilä says.
However, the demand for housing company renovations picked up considerably in the first quarter, and the volume of basic renovation loans granted for housing companies in January–March 2024 increased by 82% year over year.
"This is an excellent time for housing companies to renovate. As the market for new construction is at a standstill, workers are available for renovations, and prices have also come down," Olli Lehtilä points out.
OP Uusimaa's entire loan portfolio, including mediated loans, increased by 0.5% from the beginning of the year, totalling EUR 16.9 billion.
The loan repayment capacity of OP Uusimaa customers has remained good
The loan repayment capacity of OP Uusimaa’s customers has remained good. Non-performing exposures were up in the first quarter but remained low, accounting for 2.8% (1.6) of total exposures.
The loan repayment capacity of personal customers remained good, and requests for a change in repayment plans remained at a low level in the first quarter of 2024.
In the corporate customer business, an increase in non-performing exposures has been seen particularly in the real estate and construction sectors. OP Uusimaa's exposures to the real estate and construction sectors accounted for 4.3% (5.6) of all exposures at the end of the reporting period.
"In accordance with our mission, we want to help our customers get through difficult times. Most of our customers do not have problems with loan repayment. However, those who already had difficulties servicing their loans have experienced further challenges. This shows as an increase in non-performing loans," Olli Lehtilä says.
Strong first quarter in wealth management
"In terms of wealth management, the first quarter was strong for OP Uusimaa. We attracted a significant number of new saver and investor customers, as well as Private Banking clients. Very strong growth was also seen in investment product sales," Olli Lehtilä says.
In January–March 2024, OP Uusimaa customers increased their investment holdings in net terms by EUR 118.3 million, up 39% year over year. Interest in stock investing remained strong: the number of new book-entry accounts and equity savings accounts rose by 37% from a year ago.
In net terms, the number of OP Uusimaa customers with mutual fund holdings increased by 2,500 in January–March. Nearly 100 new Private agreements were concluded.
In January–March, OP Uusimaa’s owner-customers subscribed for Profit Shares worth EUR 27.6 million. On 2 May 2024, OP Uusimaa launched a new Profit Share issue, which will continue until 30 April 2026. The return target for 2024 is 5.5%.
In 2024, OP Uusimaa’s owner-customers will earn 40% more OP bonuses
The number of owner-customers continued to develop positively in the first quarter, totalling 365,519 at the end of March 2024. The number of owner-customers increased by 3,423 in the first quarter.
In 2024, OP Uusimaa owner-customers will receive 40% extra in OP bonuses. In January–March 2024, OP Uusimaa owner-customers earned approximately EUR 15.7 million in OP bonuses.
In addition, OP Uusimaa customers will get free daily banking services from October 2023 until the end of 2024. In January–March 2024, this meant a benefit of EUR 3.7 million for OP Uusimaa customers.
- "Our good earnings development enables us to distribute part of our earnings to our owner-customers. OP Financial Group will ensure that its owner-customers continue to benefit financially from OP bonuses," Olli Lehtilä says.