 |
Exhibit VIII
 | INTERIM MANAGEMENT STATEMENT / 2 |
Table of contents
| 3 | President and CEO’s comments | |
| 4 | Highlights | |
| 4 | Key figures and ratios | |
| 5 | Operating and financial review | |
| 5 | Total comprehensive income | |
| 8 | Financial position | |
| 10 | Financial statements | |
| 10 | Statement of comprehensive income | |
| 11 | Statement of financial position | |
| 13 | Statement of changes in equity | |
| 14 | Cash flow statement | |
| 16 | Notes to the interim financial statements | |||
| 16 | Note 1 - Net interest income | |||
| 16 | Note 2 - Net profit/loss on financial operations | |||
| 17 | Note 3 - Expected credit loss | |||
| 17 | Note 4 - Net loan losses | |||
| 18 | Note 5 - Loans outstanding | |||
| 18 | Note 6 - Debts evidenced by certificates | |||
| 19 | Note 7 - Basis of preparation | |||
| 19 | Ratio definitions | |||
| INTERIM MANAGEMENT STATEMENT / 3 |
President and CEO’s comments
Year 2023 started with the expectations of central banks raising interest rates due to stubbornly high inflation. In March, the collapse of regional banks in the US sparked concerns about the stability of the banking system. This caused volatility in the financial markets. However, the determined actions by the public authorities on both sides of the Atlantic seem to have calmed the situation, at least temporarily.
The demand for NIB’s long-term lending increased significantly in 2022, driven by a lower supply of long-term credit in the commercial bank and bond markets, the accelerated green transition and NIB’s wider sustainable finance offering. In the current circumstances, we continue to see this strong demand in 2023 and our disbursements are in line with our plans.
On 31 March, the annual meeting of the Board of Governors of NIB approved the Bank’s audited financial statements for 2022 and a dividend payment of EUR 25 million to the Nordic and Baltic member countries. Annika Saarikko, Finland’s Minister of Finance and Chair of the Bank’s Board of Governors, gave guidance to NIB: “NIB should continue focusing on the green transition and energy independence in the region. NIB should also strengthen its additionality, further engage with market segments where the biggest financing needs exist.” We at the Bank will endeavour to ensure this guidance is fulfilled through the implementation of our strategy in accordance with our mandate.
In the first quarter, a total of EUR 432 million in new lending was signed and EUR 889 million were disbursed. The lending signed was distributed across various sectors and countries, more details of which can be found here. Total assets at the quarter end amounted to EUR 42 billion compared to EUR 40 billion at 31 March 2022. The total lending outstanding amounted to EUR 22.3 billion at 31 March 2023 compared to EUR 22.9 billion at 31 March 2022. The decrease was mainly attributable to significant foreign exchange and hedge accounting impacts.
The net profit for the period January to March amounted to EUR 65 million compared to EUR 21 million in 2021. The increase in net profit is mainly due to higher net interest income and an unrealised profit on financial operations. The underlying trend in core earnings is improving and dominates the volatile result on financial operations from the increased uncertainty in the financial markets.
To meet the demand for our financing, the Bank has raised EUR 3.8 billion in new funding so far in 2023. On 7 March, NIB priced a five-year USD 1.5 billion global benchmark bond, its first USD benchmark of the year. The issue had a final orderbook of more than USD 4 billion, the largest ever for NIB.
The Bank is in a strong financial position as confirmed by our triple-A rating which was reaffirmed by Standard & Poor’s in April. NIB’s credit rating reflects its high asset quality, solid liquidity and capital adequacy, strong balance sheet and ownership.
Finally, I would like to welcome our new Head of Lending, Jeanette Vitasp to NIB. She brings a wealth of experience from a longstanding career in corporate banking, treasury and capital markets. I would also like to thank Søren Kjær Mortensen, who is retiring from the Bank in 2023 for his successful leadership of the Lending department and years of dedicated service.
André Küüsvek, President & CEO
| INTERIM MANAGEMENT STATEMENT / 4 |
Highlights
During the first quarter of 2023, lending disbursements amounted to EUR 889 million and lending signed was EUR 432 million, compared to EUR 1,107 million and EUR 1,222 million respectively, in the same period in 2022.
The Bank has raised EUR 3.8 billion in new funding so far in 2023. In March, NIB priced a five-year USD 1.5 billion global benchmark bond, which attracted high quality demand and had one hundred participating accounts, resulting in a final orderbook of more than USD 4 billion, the largest ever for NIB.
The net profit for the period January to March 2023 amounted to 65 million compared to 21 million in 2022 driven by increased interest income and net profit on financial operations. The net interest income, the Bank’s core earnings, increased from EUR 50 million in Q1 2022 to EUR 69 million in Q1 2023. During the quarter, the Bank experienced some volatility in gains and losses related to its financial operations due to the increased uncertainty in the financial markets. However, the Bank did not incur any realised losses and remains in a strong position. The net profit on financial operations amounted to EUR 9 million in Q1 2023 compared to a loss of EUR 25 million in the same period in 2022.
The Bank is in a strong financial position with solid capital and liquidity ratios as evidenced by the Bank’s triple-A rating, reaffirmed by Standard and Poor’s in April.
On 31 March, the annual meeting of the Board of Governors of NIB approved the Bank’s audited financial statements for 2022 and a dividend payment of EUR 25 million to the Nordic and Baltic member countries. The 2022 annual report can be found here.
Key figures and ratios
| In millions of euro unless otherwise specified | Jan-Mar 2023* | Jan-Mar 2022* | Jan-Dec 2022 | |||||||||
Net interest income | 69 | 50 | 219 | |||||||||
Profit before net loan losses | 66 | 15 | 136 | |||||||||
Net profit | 65 | 21 | 139 | |||||||||
| ||||||||||||
Lending disbursed | 889 | 1,107 | 3,705 | |||||||||
New signed lending | 432 | 1,222 | 4,114 | |||||||||
% of loans achieving good or above mandate ** | 100% | 100% | 99% | |||||||||
| ||||||||||||
Lending outstanding | 22,293 | 22,865 | 22,195 | |||||||||
Total assets | 41,751 | 39,575 | 39,280 | |||||||||
New debt issues | 3,780 | 4,218 | 9,630 | |||||||||
Debts evidenced by certificates | 33,894 | 32,769 | 31,595 | |||||||||
Total equity | 4,140 | 3,999 | 4,101 | |||||||||
| ||||||||||||
Equity/total assets *** | 9.9% | 10.1% | 10.4% | |||||||||
Net profit/average equity *** | 6.4% | 2.1% | 3.4% | |||||||||
Cost/income *** | 16.6% | 47.9% | 27.9% | |||||||||
Number of employees at period end | 230 | 220 | 228 | |||||||||
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
** See page 9 for mandate fulfilment explanation
*** See page 19 for ratio definitions
| INTERIM MANAGEMENT STATEMENT / 5 |
Operating and financial review
Total comprehensive income
January–March 2023 compared to January–March 2022
NET PROFIT
The net profit for the period January–March 2023 amounted to EUR 65.1 million, which is EUR 44.3 million higher than the corresponding period in 2022. Total operating income increased significantly from EUR 28.1 million to EUR 78.9 million. Net interest income increased by EUR 18.6 million while net fee and commission income decreased by EUR 2.9 million. The net profit on financial operations increased from a loss of EUR 25.4 million to a gain of EUR 9.5 million, however we have seen significant volatility in this result during the quarter mainly because of the market turmoil seen in March due to the collapse of some regional US banks and Credit Suisse in Europe. Net loan losses amounted to EUR 0.7 million compared to a gain of EUR 6.9 million in 2022. There have been no realised loan losses year to date.
NET INTEREST INCOME
Net interest income for the period amounted to EUR 68.5 million compared to EUR 50.0 million in 2022. Net interest income on lending activities amounted to EUR 42.3 million and was EUR 1.8 million higher than in 2022 due to higher loan volumes and margins. The interest income on treasury activities increased from EUR 9.5 million in Q1 2022 to EUR 26.3 million as the liquidity buffer bond portfolios benefited from increases in the market interest rate level.
NET FEE AND COMMISSION INCOME
Net fee and commission income for the period January–March 2023 of EUR 0.6 million was EUR 2.9 million lower than the same period in 2022.
| INTERIM MANAGEMENT STATEMENT / 6 |
NET PROFIT/LOSS ON FINANCIAL OPERATIONS
The net profit on financial operations for the first quarter amounted to EUR 9.5 million compared to a loss of EUR 25.4 million in the same period last year. The result comprised of unrealised profits of EUR 9.5 million compared to unrealised losses of EUR 29.0 million plus realised gains of EUR 3.6 million in 2022. Financial markets experienced some volatility during the first quarter, arising from inflationary concerns and the collapse of some regional banks in the US and Credit Suisse in Europe. These market movements resulted in valuation swings during the period on financial instruments that NIB holds to hedge its foreign exchange and interest rate risks and in its liquidity bond portfolio. The year-to-date unrealised gains amounted to EUR 31.0 million at the end of February, dropped to a loss of EUR 10.2 million in mid-March and recovered to a gain of EUR 9.5 million by 31 March.
The unrealised valuation gains and losses on assets in the Bank’s liquidity portfolio arise from changes in credit spreads. The Bank maintains a liquidity portfolio, which it invests in high quality bonds. When credit spreads widen, this results in negative valuations on the bonds. In periods of financial turbulence credit spreads tend to rise, which also affects NIB’s high quality bonds. When the Bank holds the bonds to maturity, so that they are not sold based on the current exit market value, any valuation losses and gains are expected to reverse, as the bonds will settle at par.
The unrealised valuation gains and losses on interest rate hedges mainly arise from the change of the interest rate spreads that are embedded in the Bank’s funding and lending transactions. When the Bank raises funds with fixed rates or offers borrowers fixed rate loans, it hedges the resulting interest rate risk using swaps, in which the fixed rate is swapped to short term money market floating rates. The valuation of the swaps and underlying transactions use different rates which gives rise to unrealised valuation gains and losses. It should be noted that as the Bank intends to hold these transactions to maturity these valuation gains and losses are expected to reverse in full.
TOTAL OPERATING EXPENSES
Total operating expenses amounted to EUR 13.1 million which is similar to the corresponding period in 2022. The Bank’s main expenses comprise personnel costs, cost related to administration, IT and depreciation. Personnel costs of EUR 8.8 million were EUR 0.8 million higher in Q1 2023 compared to Q1 2022 due to annual salary adjustments and a higher head count. The other operating expenses were EUR 1.1 million lower in the first quarter of 2023 compared to the same period in 2022, due to decreased depreciation as some assets reached the end of their depreciable lives towards the end of 2022.
| INTERIM MANAGEMENT STATEMENT / 7 |
NET LOAN LOSSES
During the first quarter of 2023, the Bank has recorded net loan losses of EUR 0.7 million compared to a positive amount of EUR 6.2 million for the corresponding period in 2022. The Bank updated the macro-financial scenarios used to calculate the expected credit loss (ECL) which increased the provision by approximately EUR 1.2 million however this was partly offset by an improvement in the credit quality of certain individual counter-parties. In general, there have been no significant observed changes in the credit quality of the overall loan portfolio and there were no new non-performing loans during the period and no realised losses.
OTHER COMPREHENSIVE INCOME
The Bank separates the foreign currency basis spread from financial instruments used in fair value hedge accounting and this separated amount is recorded in Other comprehensive income (OCI) which amounted to a loss of EUR 1.0 million for the period compared to a loss of EUR 23.1 million in the same period last year. The loss recorded is due to the widening of the Cross Currency Basis spreads, which negatively affect the valuation of basis swaps used to convert funding currencies into lending currencies.
For financial liabilities recorded at fair value through the profit and loss, valuation changes due to changes in own credit spreads need to be recorded in OCI. For the three month period ended 31 March 2023, the Bank recorded a negative impact from these changes of EUR 0.3 million compared to positive amount of EUR 2.4 million in 2022.
TOTAL COMPREHENSIVE INCOME
All in all, NIB had a significantly higher total comprehensive income in the first quarter of 2023 compared to the same period in 2022. Total comprehensive income ended at EUR 63.9 million compared to EUR 0.1 million in the first quarter of 2022.
| INTERIM MANAGEMENT STATEMENT / 8 |
Financial position
LENDING OUTSTANDING The lending outstanding amounted to EUR 22,293 million. This comprises EUR 21,865 million of loans outstanding and investments of EUR 428 million in lending bonds recorded in debt securities. The total disbursements and investments during the period amounted to EUR 889 million, which is EUR 219 million lower than for the same period in 2022. More information regarding loans agreed can be found on our website at Signed Loans. The large foreign exchange difference arises mainly from loans in the Nordic currencies which weakened against the Euro. |
| LENDING HIGHLIGHTS |
| |||||||||||||||||||||||||
| in EUR millions, unless otherwise specified | Jan-Mar* 2023 | Jan-Mar* 2022 | 2022 | 2021 | 2020 | 2019 | ||||||||||||||||||||||
New signed loans, excluding labelled bonds | 422 | 1,161 | 3,936 | 1,683 | 5,632 | 3,185 | ||||||||||||||||||||||
New lending labelled bonds | 10 | 61 | 178 | 169 | 34 | 131 | ||||||||||||||||||||||
Total lending disbursements | 889 | 1,107 | 3,705 | 2,440 | 4,853 | 2,676 | ||||||||||||||||||||||
Number of new signed loans | 9 | 14 | 54 | 36 | 59 | 55 | ||||||||||||||||||||||
Number of new lending labelled bonds | 1 | 4 | 10 | 14 | 4 | 9 | ||||||||||||||||||||||
Lending outstanding | 22,293 | 22,865 | 22,195 | 22,313 | 21,727 | 18,931 | ||||||||||||||||||||||
Member countries | 21,956 | 22,394 | 21,837 | 21,827 | 21,098 | 18,055 | ||||||||||||||||||||||
Non-member countries | 405 | 615 | 424 | 635 | 798 | 996 | ||||||||||||||||||||||
Loan impairment provision | -68 | -145 | -66 | -150 | -169 | -119 | ||||||||||||||||||||||
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements |
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* Fair valuation of lending green bonds and hedging accounting.
| INTERIM MANAGEMENT STATEMENT / 9 |
MISSION FULFILMENT
NIB’s vision is for a prosperous and sustainable Nordic-Baltic region and the Bank has a dual mandate to provide lending that benefits the environment and/or improves productivity. All projects proposed for financing undergo an assessment of their potential impact on productivity and the environment of the member country area. The mission fulfilment is rated on a five-grade scale from “negative” to “excellent”. During the first quarter of 2023, projects achieving a “good” or “excellent” mandate rating accounted for 100% of the total amount of loans disbursed thereby exceeding the target of 95%.
FUNDING
By the end of March, the Bank had raised EUR 3.8 billion in new funding which compares to EUR 4.2 billion in the same period last year. The strategy for 2023 is to complete benchmark transactions in US dollars and Euros, complemented with other public and private issues in order to maintain a diversified portfolio of currencies and a global investor base. The Bank will also continue issuing NIB Environmental Bonds. NIB’s estimated funding plan for 2023 is EUR 7.0-8.0 billion. On 7 March NIB priced a five-year USD 1.5 billion global benchmark bond. The transaction had NIB’s largest USD orderbook to date. The Bank also issued a three-year GBP 600 million benchmark bond in January. Also in January, the first NIB Environmental Bond of the year, a seven-year EUR 500 million NEB was launched. In February, NIB returned to the Kauri market after more than two years by pricing a seven-year NZD 700 million bond on 3 February. The bond had a good demand and is the largest seven-year bond in almost two years. For a full list of funding transactions, please click here.
The large foreign exchange movement arises from funding in Nordic currencies and USD weakening against the Euro. The increase arising from hedge accounting offsets valuation changes recorded in the income statement for derivatives used to hedge interest rate risk.
| INTERIM MANAGEMENT STATEMENT / 10 |
Financial statements
Statement of comprehensive income
| In thousands of euro | NOTE | Jan-Mar 2023* | Jan-Mar 2022* | Jan-Dec 2022 | ||||||||||||
Interest income from financial assets measured at amortised cost | 199,977 | 53,160 | 365,505 | |||||||||||||
Interest income from financial assets measured at fair value | 43,874 | 3,532 | 51,384 | |||||||||||||
Interest expense | -175,300 | -6,716 | -197,617 | |||||||||||||
Net interest income | (1) | 68,550 | 49,976 | 219,272 | ||||||||||||
Commission income and fees received | 1,434 | 4,067 | 8,805 | |||||||||||||
Commission expense and fees paid | -841 | -528 | -2,012 | |||||||||||||
Net fee and commission income | 592 | 3,538 | 6,793 | |||||||||||||
Net profit/loss on financial operations | (2) | 9,464 | -25,418 | -37,497 | ||||||||||||
Foreign exchange gains and losses | 248 | -46 | -214 | |||||||||||||
Total operating income | 78,854 | 28,050 | 188,353 | |||||||||||||
Expenses | ||||||||||||||||
General administrative expenses | ||||||||||||||||
Personnel expenses | -8,776 | -7,995 | -31,764 | |||||||||||||
Other administrative expenses | -3,328 | -3,281 | -14,544 | |||||||||||||
Depreciation | -979 | -2,156 | -6,308 | |||||||||||||
Total operating expenses | -13,083 | -13,432 | -52,616 | |||||||||||||
Profit before loan losses | 65,771 | 14,618 | 135,737 | |||||||||||||
Net loan losses | (3) (4) | -659 | 6,208 | 3,536 | ||||||||||||
Net profit for the period | 65,112 | 20,826 | 139,273 | |||||||||||||
Other comprehensive income | ||||||||||||||||
Items that will be reclassified to income statement | ||||||||||||||||
Fair value hedges - valuation of cross currency basis spread | -987 | -23,107 | -3,029 | |||||||||||||
Items that will not be reclassified to income statement | ||||||||||||||||
Changes in own credit risk on liabilities recorded at fair value | -262 | 2,405 | 6,103 | |||||||||||||
Total other comprehensive loss/income | -1,249 | -20,702 | 3,073 | |||||||||||||
Total comprehensive income | 63,863 | 124 | 142,346 | |||||||||||||
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
The accompanying notes are an integral part of these financial statements.
| INTERIM MANAGEMENT STATEMENT / 11 |
Statement of financial position
| In thousands of euro | NOTE | 31 Mar 2023* | 31 Mar 2022* | 31 Dec 2022 | ||||||||||||
ASSETS | ||||||||||||||||
Cash and cash equivalents | 3,315,528 | 3,471,060 | 2,078,406 | |||||||||||||
Financial placements | ||||||||||||||||
Placements with credit institutions | 5,157,179 | 2,039,549 | 4,469,229 | |||||||||||||
Debt securities | 9,161,406 | 8,572,379 | 8,768,457 | |||||||||||||
Other | 4,667 | 6,284 | 4,532 | |||||||||||||
| 14,323,252 | 10,618,212 | 13,242,218 | ||||||||||||||
Loans outstanding | (5) | 21,865,123 | 22,483,205 | 21,739,936 | ||||||||||||
Intangible assets | 9,477 | 6,696 | 8,704 | |||||||||||||
Tangible assets, property and equipment | 32,135 | 34,939 | 32,863 | |||||||||||||
Other assets | ||||||||||||||||
Derivatives | 1,785,684 | 1,179,315 | 1,817,179 | |||||||||||||
Other assets | 37,394 | 1,558,930 | 34,904 | |||||||||||||
| 1,823,077 | 2,738,246 | 1,852,083 | ||||||||||||||
Accrued interest and fees receivable | 382,154 | 222,383 | 325,374 | |||||||||||||
TOTAL ASSETS | 41,750,746 | 39,574,740 | 39,279,583 | |||||||||||||
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
The accompanying notes are an integral part of these financial statements.
| INTERIM MANAGEMENT STATEMENT / 12 |
| In thousands of euro | NOTE | 31 Mar 2023* | 31 Mar 2022* | 31 Dec 2022 | ||||||||||||
LIABILITIES AND EQUITY | ||||||||||||||||
Liabilities | ||||||||||||||||
Amounts owed to credit institutions | ||||||||||||||||
Short-term amounts owed to credit institutions | 726,933 | 475,423 | 689,120 | |||||||||||||
Repurchase agreements | - | 202,089 | - | |||||||||||||
Debts evidenced by certificates | (6) | 33,894,366 | 32,768,529 | 31,595,081 | ||||||||||||
Other liabilities | ||||||||||||||||
Derivatives | 2,441,912 | 1,390,363 | 2,539,630 | |||||||||||||
Other liabilities | 272,191 | 574,228 | 89,958 | |||||||||||||
| 2,714,102 | 1,964,591 | 2,629,588 | ||||||||||||||
Accrued interest and fees payable | 275,498 | 165,347 | 264,811 | |||||||||||||
Total liabilities | 37,610,900 | 35,575,979 | 35,178,600 | |||||||||||||
Equity | 4,139,847 | 3,998,761 | 4,100,983 | |||||||||||||
TOTAL LIABILITIES AND EQUITY | 41,750,746 | 39,574,740 | 39,279,583 | |||||||||||||
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
The accompanying notes are an integral part of these financial statements.
| INTERIM MANAGEMENT STATEMENT / 13 |
Statement of changes in equity
| CHANGES IN OWN CREDIT | ||||||||||||||||||||||||||||
STATUTORY RESERVE | GENERAL CREDIT RISK FUND | PROFIT AVAILABLE FOR APPROPRIATION | RISK ON LIABILITIES | HEDGING RESERVE | ||||||||||||||||||||||||
| In thousands of euro | PAID-IN CAPITAL | RECORDED AT FAIR VALUE | TOTAL | |||||||||||||||||||||||||
EQUITY AT 31 DECEMBER 2021 | 845,543 | 836,884 | 2,153,680 | 159,159 | -3,047 | 6,418 | 3,998,637 | |||||||||||||||||||||
Profit for the period | - | - | - | 20,826 | - | - | 20,826 | |||||||||||||||||||||
Other comprehensive income | - | - | - | - | 2,405 | -23,107 | -20,702 | |||||||||||||||||||||
Total comprehensive income | 0 | 0 | 0 | 20,826 | 2,405 | -23,107 | 124 | |||||||||||||||||||||
EQUITY AT 31 MARCH 2022* | 845,543 | 836,884 | 2,153,680 | 179,985 | -641 | -16,690 | 3,998,761 | |||||||||||||||||||||
Profit for the period | - | - | - | 118,447 | - | - | 118,447 | |||||||||||||||||||||
Other comprehensive income | - | - | - | - | 3,698 | 20,078 | 23,776 | |||||||||||||||||||||
Total comprehensive income | 0 | 0 | 0 | 118,447 | 3,698 | 20,078 | 142,223 | |||||||||||||||||||||
Transactions with owners in their capacity as owners | ||||||||||||||||||||||||||||
Appropriation of profit | - | - | 119,158 | -119,158 | - | - | 0 | |||||||||||||||||||||
Dividends | - | - | - | -40,000 | - | - | -40,000 | |||||||||||||||||||||
EQUITY AT 31 DECEMBER 2022 | 845,543 | 836,884 | 2,272,838 | 139,273 | 3,056 | 3,388 | 4,100,983 | |||||||||||||||||||||
Profit for the period | - | - | - | 65,112 | - | - | 65,112 | |||||||||||||||||||||
Other comprehensive income | - | - | - | - | -262 | -987 | -1,249 | |||||||||||||||||||||
Total comprehensive income | 0 | 0 | 0 | 65,112 | -262 | -987 | 63,863 | |||||||||||||||||||||
Transactions with owners in their capacity as owners | ||||||||||||||||||||||||||||
Appropriation of profit | - | - | 114,273 | -114,273 | - | - | 0 | |||||||||||||||||||||
Dividends | - | - | - | -25,000 | - | - | -25,000 | |||||||||||||||||||||
EQUITY AT 31 MARCH 2023* | 845,543 | 836,884 | 2,387,111 | 65,112 | 2,794 | 2,401 | 4,139,847 | |||||||||||||||||||||
The accompanying notes are an integral part of these financial statements.
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
| INTERIM MANAGEMENT STATEMENT / 14 |
Cash flow statement
| In thousands of euro | Jan-Mar 2023* | Jan-Mar 2022* | Jan-Dec 2022 | |||||||||
Cash flows from operating activities | ||||||||||||
Net profit for the period | 65,112 | 20,826 | 139,273 | |||||||||
Adjustments: | ||||||||||||
Unrealised gains/losses of financial assets and liabilities held at fair value | -5,283 | 21,481 | 40,003 | |||||||||
ECL non-lending activities | -483 | 25 | 1,309 | |||||||||
Depreciation and write-down in value of tangible and intangible assets | 979 | 2,156 | 6,308 | |||||||||
Change in accrued interest and fees (assets) | -47,239 | 18,762 | -84,228 | |||||||||
Change in accrued interest and fees (liabilities) | 2,134 | -19,861 | 79,651 | |||||||||
Net loan losses (ECL lending activities) | 659 | -6,208 | -3,536 | |||||||||
Hedge accounting ineffectiveness | -3,658 | 7,502 | 1,058 | |||||||||
Other adjustments to the period’s profit | -7,482 | 1,182 | 6,512 | |||||||||
Adjustments, total | -60,374 | 25,038 | 47,077 | |||||||||
Lending | ||||||||||||
Disbursements of loans | -879,196 | -1,046,147 | -3,526,941 | |||||||||
Repayments of loans | 367,460 | 456,318 | 2,702,232 | |||||||||
Lending, total | -511,736 | -589,829 | -824,709 | |||||||||
Cash flows from operating activities, total | -506,998 | -543,965 | -638,359 | |||||||||
Cash flows from investing activities | ||||||||||||
Placements and debt securities | ||||||||||||
Purchase of debt securities | -1,003,575 | -767,332 | -2,516,292 | |||||||||
Sold and/or matured debt securities | 601,296 | 489,680 | 1,729,779 | |||||||||
Placements with credit institutions | -4,604,084 | -1,363,930 | -8,560,031 | |||||||||
Sold and/or matured placements with credit institutions | 3,916,095 | 3,307,086 | 7,972,838 | |||||||||
Other financial placements | 702 | -14 | -72 | |||||||||
Placements and debt securities, total | -1,089,566 | 1,665,490 | -1,373,778 | |||||||||
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
The accompanying notes are an integral part of these financial statements.
| INTERIM MANAGEMENT STATEMENT / 15 |
| In thousands of euro | Jan-Mar 2023* | Jan-Mar 2022* | Jan-Dec 2022 | |||||||||
Other items | ||||||||||||
Acquisition of intangible assets | -864 | -487 | -4,051 | |||||||||
Acquisition of tangible assets | -61 | -76 | -383 | |||||||||
Change in other assets | -333 | -154,363 | -7,740 | |||||||||
Other items, total | -1,258 | -154,927 | -12,174 | |||||||||
Cash flows from investing activities, total | -1,090,824 | 1,510,563 | -1,385,951 | |||||||||
Cash flows from financing activities | ||||||||||||
Debts evidenced by certificates | ||||||||||||
Issues of new debt | 3,780,001 | 2,844,826 | 9,630,309 | |||||||||
Redemptions | -1,088,286 | -2,519,644 | -7,356,900 | |||||||||
Debts evidenced by certificates, total | 2,691,715 | 325,182 | 2,273,409 | |||||||||
Other items | ||||||||||||
Change in swap receivables excluding fair value changes | -238,353 | 35,190 | 30,704 | |||||||||
Change in swap payables excluding fair value changes | 230,172 | 79,506 | 56,383 | |||||||||
Change in other liabilities | 121,116 | 311,990 | 1,594 | |||||||||
Dividend paid | - | - | -40,000 | |||||||||
Other items, total | 112,935 | 426,686 | 48,682 | |||||||||
Cash flows from financing activities, total | 2,804,650 | 751,868 | 2,322,091 | |||||||||
CHANGE IN CASH AND CASH EQUIVALENTS, NET | 1,206,827 | 1,718,467 | 297,780 | |||||||||
Opening balance for cash and cash equivalents, net | 1,389,286 | 1,074,754 | 1,074,754 | |||||||||
Exchange rate adjustments | -7,519 | 327 | 16,752 | |||||||||
Closing balance for cash and cash equivalents, net | 2,588,595 | 2,793,548 | 1,389,286 | |||||||||
Additional information to the statement of cash flows | ||||||||||||
Interest income received | 187,070 | 75,454 | 332,661 | |||||||||
Interest expense paid | -164,613 | -26,540 | -117,976 | |||||||||
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
The accompanying notes are an integral part of these financial statements. The cash flow statement has been prepared using the indirect method and cash flow items cannot be directly concluded from the statements of financial positions.
| INTERIM MANAGEMENT STATEMENT / 16 |
Notes to the interim financial statements
Note 1: Net interest income
In thousands of euro | | Jan-Mar 2023 | * | | Jan-Mar 2022 | * | | Jan-Dec 2022 |
| |||
Cash and cash equivalents | 18,057 | -3,868 | 2,761 | |||||||||
Placements with credit institutions | 20,331 | -3,743 | -346 | |||||||||
Debt securities | 27,258 | 9,560 | 59,382 | |||||||||
Loans outstanding | 178,204 | 54,744 | 354,938 | |||||||||
Other interest income | - | - | 153 | |||||||||
Total, interest income | 243,850 | 56,692 | 416,889 | |||||||||
Of which, interest income from financial assets measured at amortised cost | 199,977 | 53,160 | 365,505 | |||||||||
Short-term amounts owed to credit institutions | -4,102 | 970 | -216 | |||||||||
Short-term repurchase agreements | -17 | 3 | -30 | |||||||||
Debts evidenced by certificates | -168,097 | -100,721 | -514,049 | |||||||||
Swap contracts and other interest expenses, net | -3,084 | 93,032 | 316,678 | |||||||||
Total, interest expense | -175,300 | -6,716 | -197,617 | |||||||||
Of which, interest expense from financial liabilities measured at amortised cost | -252,693 | -6,190 | -318,612 | |||||||||
Net interest income | 68,550 | 49,976 | 219,272 |
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
Note 2: Net profit/loss on financial operations
In thousands of euro | | Jan-Mar 2023 | * | | Jan-Mar 2022 | * | | Jan-Dec 2022 |
| |||
Financial instruments held at fair value, realised gains and losses | 32 | 3,582 | 10,613 | |||||||||
Financial instruments held at fair value, unrealised gains and losses | 5,283 | -21,481 | -40,003 | |||||||||
Financial instruments held at amortised cost, realised gains and losses | 8 | 8 | -5,741 | |||||||||
Expected credit loss on financial placements | 483 | -25 | -1,309 | |||||||||
Hedge accounting ineffectiveness | 3,658 | -7,502 | -1,058 | |||||||||
Net profit/loss on financial operations | 9,464 | -25,418 | -37,497 | |||||||||
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
| INTERIM MANAGEMENT STATEMENT / 17 |
Note 3: Expected credit loss
| In thousands of euro | STAGE 1 | STAGE 2 | STAGE 3 | TOTAL | ||||||||||||
Balance at 31 December 2021 | 32,103 | 42,252 | 78,090 | 152,445 | ||||||||||||
Transfer to Stage 1 | 8,099 | -8,099 | - | 0 | ||||||||||||
Transfer to Stage 2 | -13 | 13 | - | 0 | ||||||||||||
Transfer to Stage 3 | - | - | - | 0 | ||||||||||||
New assets originated or disbursed | 1,433 | - | - | 1,433 | ||||||||||||
Amortisations and repayments | -435 | -292 | - | -727 | ||||||||||||
Impact of remeasurment on existing assets | 1,923 | -6,126 | -2,686 | -6,889 | ||||||||||||
Foreign exchange adjustments and other changes | - | - | 1,495 | 1,495 | ||||||||||||
Net change income statement | 11,007 | -14,504 | -1,191 | -4,688 | ||||||||||||
Balance at 31 March 2022 * | 43,110 | 27,748 | 76,899 | 147,757 | ||||||||||||
Transfer to Stage 1 | -930 | 930 | - | 0 | ||||||||||||
Transfer to Stage 2 | -338 | 338 | - | 0 | ||||||||||||
Transfer to Stage 3 | - | -1,101 | 1,101 | 0 | ||||||||||||
New assets originated or disbursed | 17,660 | 1,225 | - | 18,885 | ||||||||||||
Amortisations and repayments | -3,491 | -1,264 | - | -4,755 | ||||||||||||
Impact of remeasurment on existing assets | -4,386 | -14,386 | 8,598 | -10,174 | ||||||||||||
Foreign exchange adjustments and other changes | - | - | 2,765 | 2,765 | ||||||||||||
Net change income statement | 8,515 | -14,258 | 12,464 | 6,721 | ||||||||||||
Realised losses | - | - | -79,331 | -79,331 | ||||||||||||
Balance at 31 December 2022 | 51,624 | 13,490 | 10,033 | 75,147 | ||||||||||||
Transfer to Stage 1 | 928 | -928 | - | 0 | ||||||||||||
Transfer to Stage 2 | -77 | 77 | - | 0 | ||||||||||||
Transfer to Stage 3 | - | - | - | 0 | ||||||||||||
New assets originated or disbursed | 5,551 | 240 | - | 5,791 | ||||||||||||
Amortisations and repayments | -5,595 | -267 | - | -5,862 | ||||||||||||
Impact of remeasurment on existing assets | -619 | 866 | - | 247 | ||||||||||||
Foreign exchange adjustments and other changes | 0 | 0 | -28 | -28 | ||||||||||||
Net change income statement | 187 | -11 | -28 | 148 | ||||||||||||
Balance at 31 March 2023* | 51,811 | 13,479 | 10,005 | 75,295 | ||||||||||||
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
PRESENTATION OF ECL IN THE STATEMENT OF FINANCIAL POSITION
| In thousands of euro | 31 Mar 2023* | 31 Mar 2022* | 31 Dec 2022 | |||||||||
Loans outstanding | 67,871 | 144,865 | 65,687 | |||||||||
Other receivables | 0 | 1,859 | 0 | |||||||||
Commitments (recorded in other liabilities) | 6,330 | 740 | 7,884 | |||||||||
Financial placements | 1,094 | 293 | 1,577 | |||||||||
Total | 75,295 | 147,757 | 75,147 | |||||||||
PRESENTATION OF ECL IN THE STATEMENT OF COMPREHENSIVE INCOME
| In thousands of euro | Jan-Mar 2023* | Jan-Mar 2022* | Jan-Dec 2022 | |||||||||
Net result on financial operations | 483 | -25 | -1,309 | |||||||||
Net loan losses (Note 4) | -659 | 6,208 | 3,536 | |||||||||
Foreign exchange gains and losses | 28 | -1,495 | -4,260 | |||||||||
Total | -148 | 4,688 | -2,033 | |||||||||
Note 4: Net loan losses
| In thousands of euro | Jan-Mar 2023* | Jan-Mar 2022* | Jan-Dec 2022 | |||||||||
Change in expected credit loss on performing loans | -659 | 3,522 | 10,550 | |||||||||
Change in expected credit loss on non-performing loans | - | 2,686 | -7,014 | |||||||||
Decrease of provisions to cover realised loan losses | - | - | -79,331 | |||||||||
Realised loan losses | - | - | 79,331 | |||||||||
Net loan losses | -659 | 6,208 | 3,536 | |||||||||
There were no realised losses for the periods Jan-Mar 2023 or Jan-Mar 2022. During 2022 the Bank had realised losses of EUR 79,331 thousand which had no impact to the income statement as the related loans were fully impaired in previous years.
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
| INTERIM MANAGEMENT STATEMENT / 18 |
Note 5: Lending outstanding
| In thousands of euro | Jan-Mar 2023* | Jan-Mar 2022* | Jan-Dec 2022 | |||||||||
| Opening Balance | 22,194,850 | 22,312,579 | 22,312,579 | |||||||||
Disbursements | 888,696 | 1,106,878 | 3,705,191 | |||||||||
Amortisations | -392,260 | -306,304 | -2,149,355 | |||||||||
Prepayments | -8,400 | -157,014 | -559,877 | |||||||||
Changes in expected credit losses | -2,212 | 6,446 | 10,918 | |||||||||
Foreign exchange movements | -435,750 | 136,855 | -499,682 | |||||||||
Fair value adjustments | 8,057 | -11,121 | -30,857 | |||||||||
Hedge accounting adjustments | 41,248 | -223,209 | -586,357 | |||||||||
Other | -1,232 | -463 | -7,709 | |||||||||
Closing balance | 22,292,998 | 22,864,645 | 22,194,850 | |||||||||
Loans outstanding | 21,865,123 | 22,483,205 | 21,739,936 | |||||||||
Lending bonds | 427,875 | 381,440 | 454,914 | |||||||||
Total Lending | 22,292,998 | 22,864,645 | 22,194,850 | |||||||||
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
Note 6: Debts evidenced by certificates
| In thousands of euro | Jan-Mar 2023* | Jan-Mar 2022* | Jan-Dec 2022 | |||||||||
Opening Balance | 31,595,081 | 31,525,985 | 31,525,985 | |||||||||
New debt issues | 3,780,001 | 4,217,531 | 9,630,309 | |||||||||
Amortisations | -1,032,389 | -2,449,151 | -7,217,679 | |||||||||
Calls and buy backs | -56,170 | -68,493 | -154,590 | |||||||||
Foreign exchange movements | -656,597 | 416,168 | 56,016 | |||||||||
Fair value adjustments | -7,214 | -13,371 | -58,584 | |||||||||
Hedge accounting adjustments | 271,381 | -861,639 | -2,201,745 | |||||||||
Other | 272 | 1,499 | 15,368 | |||||||||
Closing balance | 33,894,366 | 32,768,529 | 31,595,081 | |||||||||
* Unaudited figures, to be read in conjunction with NIB’s 2022 audited financial statements
| INTERIM MANAGEMENT STATEMENT / 19 |
Note 7: Basis of preparation
This interim management statement is not presented in accordance with IAS 34 “Interim Financial Reporting”, as this statement excludes a number of disclosures. The accounting policies and methods of computation are the same as described in Note 1 of NIB’s Financial Statements 2022.
This report was approved by the Bank’s Executive Committee on 20th April 2023. |
Ratio definitions
Equity/total assets =
| Total equity at reporting date | |
| Total assets at reporting date | ||
Net Profit/average equity =
| Annualised profit for the period | |
| Average equity for the period | ||
Cost/income =
| Total operating expenses for the period | |
| Total operating income for the period | ||
 |