KLP Banken GroupQ1 2022
Main features by first quarter:
- Strong lending growth
- Increased funding costs
- Market value loss on securities
The KLP Banken Group finances mortgages and other credit in the retail market and lending to municipalities, county administrations and companies carrying out public sector assignments. Additionally, the KLP Banken manages a lending portfolio on behalf of its parent company KLP (Kommunal Landspensjonskasse). The Group manages a lending total of NOK 116 (113) billion. The lending business is nationwide and divided into the business areas retail market and public sector loans.
In the retail market, KLP Banken shall offer products and services at competitive terms, aiming at enterprises that have chosen KLP as their pension provider are considered attractive employers.
In the public sector market KLP Kommunekreditt AS together with KLP shall contribute to market competition and thereby access to favorable long-term financing for the sector.
KLP Banken AS is wholly owned by KLP. KLP Banken AS has two wholly owned subsidiaries, KLP Kommunekreditt AS and KLP Boligkreditt AS. The main office is in Trondheim.
Income statement
Net interest income for the KLP Banken Group as at the end of first quarter 2022, amounted to NOK 72.1 (75.7) million. Reduced net interest income is mainly related to that increased funding costs has resulted in lower lending margins, especially on mortgages. Strong lending growth has only partly compensated this.
Net fees and commissions income amount to NOK 5.2 (4.2) million as at the first quarter.
The Group administers housing mortgages and public sector lending financed by its parent company (KLP). The management fee for this task amounted to NOK 15.1 (14.9) million at quarter end.
The accounting line net gain/loss on financial instruments mainly comprises the effects of changes in market value of the securities portfolio as well as repurchases of borrowings. In total, financial instruments gave a cost of NOK -10.1 (14.5) million in the quarter. The cost brought to book is mainly due to increased credit spreads in the market resulting in reduced market value of the securities portfolio. An insignificant part of this is realized loss.
Operating expenses including depreciations amounted to NOK 64.0 (60.6) million. Most of the increase is related to prize changes on external service purchases as well as that some expenses are volume dependent.
Loan loss provisions and realized losses so far in 2022 was NOK 0.1 (-0.5) million in the retail market. A positive figure here implies that reversals of previous loss provisions on credit cards and mortgages are higher than new credit losses and loss provision.
The KLP Banken Group had a pre-tax profit at the end of first quarter of NOK 18.3 (48.6) million. Of this, the retail market segment generated a profit of NOK 8.3 (41.8) million, and the public sector segment achieved a profit of NOK 10.0 (6.8) million. Net gain/loss on financial instruments is mainly booked in the retail market segment. Group total income as at first quarter 2022 was NOK 56.2 (69.8) million.
Lending and credits
On 31 March 2021, the KLP Banken Group had a lending balance to customers totaling NOK 40.6 (37.6) billion. The distribution between the retail market and public sector market was NOK 22.6 (20.9) billion and NOK 18.0 (16.7) billion, respectively.
The mortgage lending growth in the first qurter was more than NOK 0.5 billion, significantly above same time last year. The bank's mortgage products seem to hit well in the target group, members of the pension schemes in KLP.
Mortgage loans amounting NOK 1.5 (2.2) billion was sold from KLP Banken AS to the daughter company KLP Boligkreditt AS in the quarter. Managed mortgages for KLP are little changed during the quarter.
Drawn credits on credit cards has been stable through the first quarter, but unused credits show a reduction. This is a consequence of a general decrease in the market for unsecured credits as well as a reduction in inactive users. The number of active credit card customers has increased through the quarter.
The public sector lending balance in KLP Banken has increased by NOK 0.2 billion so far this year. Managed public sector loans on behalf of KLP has increased by NOK 0.1 billion.
Liquid investment
The liquidity is invested in other banks and in interest-bearing securities. Investments in credit institutions amounted to NOK 1.2 (2.2) billion. The book value of interest-bearing securities valued at fair value was NOK 6.1 (3.3) billion in the KLP Banken Group at the end of the quarter.
Borrowing
The KLP Banken Group's external financing comprises deposits and bonds. At the reporting date, deposits from individuals and companies were NOK 13.4 (12.1) billion and issued bonds amounted to NOK 31.9 (27.1) billion. Of the outstanding issued volume, covered bonds (OMF) issued by KLP Kommunekreditt AS and KLP Boligkreditt AS, amounted to NOK 18.5 (17.2) billion and NOK 12.4 (10.4) billion respectively. All covered bond issues have achieved AAA rating. Outstanding securities debt in KLP Banken AS amounted to NOK 0.9 (0.8) billion.
Risk and capital adequacy
The KLP Banken Group is exposed to various types of risks and the bank has established a framework for risk management aimed at ensuring risks are identified, analyzed and subject to management using policies, limits, procedures and instructions.
The bank shall have a prudent risk profile and earnings are to be principally a result of borrowing and lending activities, as well as liquidity management. This means that the bank is to have low market risk, and interest risk arising within the borrowing and lending activities is reduced using derivatives.
The KLP Banken Group and its subsidiaries are to have sound long-term financing and limits have been established to ensure that that this objective is achieved.
The credit risk associated with the bank assets is low, and lending is mainly limited to local government risk and lien on housing property. Management of the bank's liquidity is conducted through investments in other banks satisfying set credit quality requirements, and in securities in accordance with Board-approved credit lines.
The KLP Banken Board is worried about the development following the war in Ukraine. The bank has no credit exposure in this area, but may as other Norwegian banks, be affected by the financial turmoil following the situation.
At the end of the first quarter 2022, eligible Tier 1 and Tier 2 capital i.a.w. the capital adequacy rules were NOK 2 464 (2 405) million. Eligible Tier 1 and Tier 2 capital comprise core capital only. Lending is risk-weighted in accordance with the authorities' capital adequacy regulations. The KLP Banken Group had a capital adequacy ratio of 18.1 (19.3) per cent at the reporting time. The minimum statutory requirement is 12.5 per cent core capital adequacy and 16.0 per cent capital adequacy. Leverage ratio was 5.1 (5.5) per cent. Here the requirement is 3.0 per cent.
Income statementKLP Banken Group
NOTES | NOK THOUSANDS | Q1 2022 | Q1 2021 | 01.01.2021 -31.12.2021 |
---|---|---|---|---|
Interest income, effective interest method | 180 181 | 152 173 | 621 624 | |
Other interest income | 26 221 | 15 700 | 68 176 | |
3 | Total interest income | 206 401 | 167 873 | 689 801 |
Interest expense, effective interest method | -120 265 | -69 040 | -290 728 | |
Other interest expense | -14 060 | -23 110 | -90 463 | |
3 | Total interest costs | -134 325 | -92 149 | -381 191 |
3 | Net interest income | 72 076 | 75 724 | 308 609 |
Commision income and income from banking services | 5 717 | 4 553 | 21 520 | |
Commision cost and cost from banking services | -524 | -375 | -2 033 | |
Net charges and commission income | 5 194 | 4 178 | 19 487 | |
Other fee income | 15 118 | 14 850 | 59 400 | |
16 | Net gain/ (loss) financial instruments | -10 107 | 14 467 | -32 896 |
Total other operating income | 5 011 | 29 317 | 26 504 | |
Salaries and administrative costs | -21 810 | -20 289 | -81 930 | |
Depreciation | -1 015 | -1 663 | -6 409 | |
Other operating expenses | -41 206 | -38 101 | -147 846 | |
14 | Net loan losses | 63 | -533 | -2 299 |
Total operating expenses | -63 969 | -60 586 | -238 484 | |
Operating profit/loss before tax | 18 312 | 48 633 | 116 117 | |
Tax ordinary income | 24 298 | 15 352 | -423 | |
Profit/loss for the period | 42 610 | 63 985 | 115 694 | |
Estimate difference, pension obligation and assets | 18 113 | 7 732 | 7 136 | |
Tax on actuarial gains and losses | -4 528 | -1 933 | -1 784 | |
Items that will not be reclassified to profit and loss | 13 585 | 5 799 | 5 352 | |
Changes in the fair value through profit and loss | 0 | 0 | 0 | |
Tax on changes in fair value of available for sale financial assets | 0 | 0 | 0 | |
Items that may be reclassified to profit and loss | 0 | 0 | 0 | |
Other comprehensive income for the period | 13 585 | 5 799 | 5 352 | |
Comprehensive income for the period | 56 195 | 69 784 | 121 046 |
Balance sheetKLP Banken Group
NOTES | NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 |
---|---|---|---|---|
ASSETS | ||||
5 | Claims on central banks | 67 275 | 66 365 | 67 244 |
5 | Loans to credit institutions | 1 094 116 | 2 172 888 | 1 398 501 |
4,5 | Loans to customers | 40 609 817 | 37 628 313 | 39 934 100 |
5,6,13 | Fixed-income securities | 6 051 162 | 3 263 812 | 6 001 099 |
5,6 | Shareholdings | 1 187 | 1 197 | 1 187 |
5,6,8 | Financial derivatives | 87 724 | 45 859 | 42 051 |
Deferred tax assets | 5 723 | 0 | 0 | |
Intangible assets | 16 475 | 17 751 | 16 789 | |
17 | Right-of-use assets | 17 768 | 1 558 | 18 236 |
Fixed assets | 436 | 438 | 436 | |
10 | Other assets | 2 329 | 2 209 | 2 217 |
Total assets | 47 954 012 | 43 200 390 | 47 481 860 | |
LIABILITIES AND OWNERS EQUITY | ||||
LIABILITIES | ||||
5 | Debt to credit institutions | 0 | 1 303 191 | 0 |
5,7 | Debt securities issued | 31 862 183 | 27 147 360 | 31 917 798 |
5 | Deposits and borrowings from the public | 13 372 222 | 12 103 244 | 12 901 004 |
5,6,8 | Financial derivatives | 17 111 | 53 550 | 9 990 |
Deferred tax liabilities | 0 | 25 214 | 23 343 | |
17 | Lease liabilities | 17 938 | 1 626 | 18 323 |
11 | Other liabilities | 88 465 | 41 576 | 38 369 |
11 | Provision for accrued costs and liabilities | 47 755 | 55 109 | 52 249 |
Total liabilities | 45 405 675 | 40 730 870 | 44 961 078 | |
EQUITY | ||||
Share capital | 1 065 000 | 1 065 000 | 1 065 000 | |
Share premium | 825 000 | 825 000 | 825 000 | |
Other owners' eqyity | 602 142 | 509 736 | 630 782 | |
Profit for the period | 56 195 | 69 784 | 0 | |
Total equity | 2 548 337 | 2 469 520 | 2 520 782 | |
Total liabilities and equity | 47 954 012 | 43 200 390 | 47 481 860 |
Statement of changes in equityKLP Banken Group
2022 NOK THOUSANDS | Share capital | Share premium | Other equity | Total owners’ equity |
---|---|---|---|---|
Equity 1 January 2022 | 1 065 000 | 825 000 | 630 782 | 2 520 782 |
Profit for the period | 0 | 0 | 42 610 | 42 610 |
Other comprehensive income | 0 | 0 | 13 585 | 13 585 |
Total comprehensive income for the period | 0 | 0 | 56 195 | 56 195 |
Group contribution received during the period | 0 | 0 | 89 292 | 89 292 |
Group contribution paid during the period | 0 | 0 | -117 932 | -117 932 |
Total transactions with the owners | 0 | 0 | -28 640 | -28 640 |
Equity 31 March 2022 | 1 065 000 | 825 000 | 658 337 | 2 548 337 |
2021 NOK THOUSANDS | Share capital | Share premium | Other equity | Total owners’ equity |
---|---|---|---|---|
Equity 1 January 2021 | 1 065 000 | 825 000 | 536 801 | 2 426 801 |
Profit for the period | 0 | 0 | 63 985 | 63 985 |
Other comprehensive income | 0 | 0 | 5 799 | 5 799 |
Total comprehensive income for the period | 0 | 0 | 69 784 | 69 784 |
Group contribution received during the period | 0 | 0 | 84 919 | 84 919 |
Group contribution paid during the period | 0 | 0 | -111 985 | -111 985 |
Total transactions with the owners | 0 | 0 | -27 065 | -27 065 |
Equity 31 March 2021 | 1 065 000 | 825 000 | 579 520 | 2 469 520 |
2021 NOK THOUSANDS | Share capital | Share premium | Other equity | Total owners’ equity |
---|---|---|---|---|
Equity 1 January 2021 | 1 065 000 | 825 000 | 536 801 | 2 426 801 |
Income for the year | 0 | 0 | 115 694 | 115 694 |
Other comprehensive income | 0 | 0 | 5 352 | 5 352 |
Comprehensive income for the year | 0 | 0 | 121 046 | 121 046 |
Group contribution received during the period | 0 | 0 | 84 919 | 84 919 |
Group contribution paid during the period | 0 | 0 | -111 985 | -111 985 |
Total transactions with the owners | 0 | 0 | -27 065 | -27 065 |
Equity 31 December 2021 | 1 065 000 | 825 000 | 630 782 | 2 520 782 |
Statement of cash flowKLP Banken Group
NOK THOUSANDS | Q1 2022 | Q1 2021 | 01.01.2021 -31.12.2021 |
---|---|---|---|
OPERATING ACTIVITIES | |||
Payments received from customers – interest, commission and charges | 162 360 | 148 669 | 638 105 |
Payments to customers – interest, commission and charges | -27 179 | -17 232 | -89 196 |
Disbursements on loans to customers and credit institutions | -2 592 417 | -4 558 427 | -16 640 961 |
Receipts on loans to customers | 1 876 531 | 5 109 975 | 14 782 637 |
Net receipts on customer deposits banking | 471 218 | 322 613 | 1 119 290 |
Disbursements on operations | -25 839 | -36 047 | -148 301 |
Payments to staff, pension schemes, employer's social security contribution etc. | -21 042 | -21 778 | -81 174 |
Interest investment accounts | 3 144 | 695 | 9 617 |
Net receipts/disbursements from operating activities | 69 998 | -80 571 | 64 335 |
Net cash flow from operating activities | -83 224 | 867 897 | -345 647 |
INVESTMENT ACTIVITIES | |||
Receipts on the sale of securities | 998 521 | 3 331 460 | 9 763 759 |
Payments on the purchase of securities | -1 056 761 | -1 628 045 | -9 551 367 |
Receipts of interest from securities | 16 866 | 4 843 | 45 074 |
Payments on the purchase of tangible fixed assets | -233 | 0 | -2 578 |
Net cash flow from investment activities | -41 608 | 1 708 258 | 254 889 |
FINANCING ACTIVITIES | |||
Repayment and redemption from credit institutions | 0 | -1 200 000 | -2 500 000 |
Net payment of interest from credit institutions | 0 | -2 493 | -6 517 |
Receipts on loans | 1 500 000 | 0 | 9 300 000 |
Repayments and redemption of securities debt | -1 088 835 | -1 452 000 | -6 569 839 |
Change in securities debt, own funds | -454 000 | 1 011 830 | 343 369 |
Net payment of interest on loans | -91 031 | -50 450 | -238 607 |
Payment of lease liabilities | -415 | -399 | -1 654 |
Group contributions made | -28 640 | 0 | -27 065 |
Net cash flows from financing activities | -162 921 | -1 693 511 | 299 685 |
Net cash flow during the period | -287 754 | 882 643 | 208 928 |
Cash and cash equivalents at the start of the period | 1 420 995 | 1 212 067 | 1 212 067 |
Cash and cash equivalents at the end of the period | 1 133 241 | 2 094 710 | 1 420 995 |
Net receipts/disbursements (-) | -287 754 | 882 643 | 208 928 |
Notes to the financial statementKLP Banken Group
Note 1 General information
KLP Banken AS was formed on 25 February 2009. KLP Banken AS owns all the shares in KLP Kommunekreditt AS and KLP Boligkreditt AS. These companies together form the KLP Banken AS Group. KLP Banken AS Group provide or acquire loans to Norwegian municipalities and county authorities, as well as to companies with public sector guarantee. The lending activities are principally financed by issuance of covered bonds. The Group also offers standard banking products to private customers. KLP Banken AS is registered and domiciled in Norway. It's head office is at Beddingen 8 in Trondheim. The company has a branch office in Dronning Eufemiasgate 10, Oslo.
The company, KLP Banken AS, is a wholly owned subsidiary of Kommunal Landspensjonskasse (KLP). KLP is a mutual insurance company.
Note 2 Accounting principles
The interim report includes the interim Financial Statements of KLP Banken Group for the period 1 January 2022 – 31 March 2022, with a specification of the results in the firsth quarter. The interim Financial Statements has not been audited.
The interim financial statements have been prepared in accordance with IAS 34 "Interim Financial Reporting".
The KLP Banken Group has changed the discount rate for corporate bonds which is used to calculate pension obligations. Compared to the assumptions used at 31.12.2021, the discount rate has been changed from 1.9 % to 2.7 %. This change results in a reduction of NOK 18.1 million in recognised liabilities as at 31.03.2022. Demographic assumptions such as expected wage growth, the National Insurance basic amount (G) and pension regulations have not changed in the period. New rules regulating deferred pensions have been adopted, but the Norwegian Accounting Standards Board has not issued any guidance on how these should be included in the pension accounts. This should be clarified soon and is expected to affect the company’s pension obligations in later periods.
Other accounting principles and calculations are the same in the interim financial statement as in the annual report for 2021.
Note 3 Net interest income
NOK THOUSANDS | Q1 2022 | Q1 2021 | 01.01.2021 -31.12.2021 |
---|---|---|---|
Interest income on loans to customers | 176 807 | 151 380 | 617 688 |
Interest income on loans to credit institutions | 3 374 | 792 | 3 937 |
Total interest income, effective interest method | 180 181 | 152 173 | 621 624 |
Interest income on bonds and certificates | 18 746 | 6 750 | 36 486 |
Other interest income | 7 475 | 8 949 | 31 690 |
Total other interest income | 26 221 | 15 700 | 68 176 |
Total interest income | 206 401 | 167 873 | 689 801 |
Interest expenses on deposits to KLP Banken | -22 031 | -16 558 | -70 216 |
Interest expenses on issued securities | -98 151 | -52 473 | -220 403 |
Interest expense lease liabilities | -83 | -9 | -109 |
Total interest expense, effective interest method | -120 265 | -69 039 | -290 728 |
Other interest expenses | -9 333 | -20 136 | -73 196 |
Interest expenses on deposits to customers | -4 727 | -2 974 | -17 268 |
Total other interest expense | -14 060 | -23 110 | -90 463 |
Total interest expense | -134 325 | -92 149 | -381 191 |
Net interest income | 72 076 | 75 724 | 308 609 |
Note 4 Loans to customers
NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 |
---|---|---|---|
Principal on loans to customers | 40 582 110 | 37 505 259 | 39 870 185 |
Credit portfolio | 43 816 | 45 986 | 43 355 |
Overdraft current account | 174 | 574 | 179 |
Write-downs step 1 and 2 | -1 299 | -1 112 | -1 075 |
Write-downs step 3 | -1 599 | -1 270 | -1 040 |
Loans to customers after write-downs | 40 623 203 | 37 549 437 | 39 911 604 |
Accrued interest | 73 535 | 60 912 | 53 852 |
Premium/discount | 0 | 37 | 0 |
Fair value hedging | -86 920 | 17 927 | -31 356 |
Loans to customers | 40 609 817 | 37 628 313 | 39 934 100 |
Note 5 Categories of financial instruments
NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 | |||
---|---|---|---|---|---|---|
Capitalized value | Fair value | Capitalized value | Fair value | Capitalized value | Fair value | |
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT AND LOSS | ||||||
Fixed-income securities | 6 051 162 | 6 051 162 | 3 263 812 | 3 263 812 | 6 001 099 | 6 001 099 |
Financial derivatives | 87 724 | 87 724 | 45 859 | 45 859 | 42 051 | 42 051 |
Shares and holdings | 1 187 | 1 187 | 1 197 | 1 197 | 1 187 | 1 187 |
Total financial assets at fair value through profit and loss | 6 140 073 | 6 140 073 | 3 310 867 | 3 310 867 | 6 044 337 | 6 044 337 |
FINANCIAL ASSETS FAIR VALUE HEDGING | ||||||
Loans to and receivables from customers | 1 816 706 | 1 851 218 | 3 295 179 | 3 357 039 | 2 012 822 | 2 056 718 |
Total financial assets fair value hedging | 1 816 706 | 1 851 218 | 3 295 179 | 3 357 039 | 2 012 822 | 2 056 718 |
FINANCIAL ASSETS AT AMORTIZED COST | ||||||
Loans to and receivables from credit institutions | 67 275 | 67 275 | 66 365 | 66 365 | 67 244 | 67 244 |
Loans to and receivables from central banks | 1 094 116 | 1 094 116 | 2 172 888 | 2 172 888 | 1 398 501 | 1 398 501 |
Loans to and receivables from customers | 38 793 111 | 38 758 515 | 34 333 134 | 34 271 088 | 37 921 278 | 37 877 270 |
Total financial assets at amortized cost | 39 954 501 | 39 919 905 | 36 572 387 | 36 510 340 | 39 387 023 | 39 343 014 |
Total financial assets | 47 911 280 | 47 911 196 | 43 178 433 | 43 178 247 | 47 444 181 | 47 444 069 |
FINANCIAL LIABILITIES AT FAIR VALUE THROUGH PROFIT AND LOSS | ||||||
Financial derivatives | 17 111 | 17 111 | 53 550 | 53 550 | 9 990 | 9 990 |
Total financial liabilities at fair value through profit and loss | 17 111 | 17 111 | 53 550 | 53 550 | 9 990 | 9 990 |
FINANCIAL LIABILITIES FAIR VALUE HEDGING | ||||||
Liabilities created on issuance of securities | 489 379 | 494 163 | 1 127 265 | 1 139 273 | 508 146 | 515 581 |
Total financial liabilities fair value hedging | 489 379 | 494 163 | 1 127 265 | 1 139 273 | 508 146 | 515 581 |
FINANCIAL LIABILITIES AT AMORTIZED COST | ||||||
Liabilities to credit institutions | 0 | 0 | 1 303 191 | 1 303 191 | 0 | 0 |
Liabilities created on issuance of securities | 31 372 804 | 30 929 333 | 26 020 096 | 26 166 146 | 31 409 652 | 30 977 884 |
Deposits from customers | 13 372 222 | 13 372 222 | 12 103 244 | 12 103 244 | 12 901 004 | 12 901 004 |
Total financial liabilities at amortized cost | 44 745 026 | 44 301 555 | 39 426 531 | 39 572 581 | 44 310 656 | 43 878 888 |
Total financial liabilities | 45 251 517 | 44 812 829 | 40 607 345 | 40 765 404 | 44 828 792 | 44 404 459 |
Fair value shall be a representative price based on what a corresponding asset or liability would have been traded for on normal market terms and conditions. A financial instrument is considered to be listed in an active market if the listed price is simply and regularly available from a stock market, dealer, broker, industry grouping, price setting service or regulatory authority, and these prices represent actual and regularly occurring transactions at arm’s length. If the market for the security is not active, or the security is not listed on a stock market or similar, valuation techniques are used to set fair value. These are based for example on information on recently completed transactions carried out on business terms and conditions, reference to trading in similar instruments and pricing using externally collected yield curves and yield spread curves. As far as possible the estimates are based on externally observable market data and rarely on company-specific information.
The different financial instruments are thus priced in the following way:
Fixed-income securities - government
Nordic Bond Pricing is used as a source for pricing Norwegian government bonds. The prices are compared with the prices from Bloomberg to reveal any errors.
Fixed-income securities - other than government
Norwegian fixed-income securities, except government are priced directly on prices from Nordic Bond Pricing. Those securities that are not included in Nordic Bond Pricing are priced theoretically. The theoretical price is based on the assumed present value on the sale of the position. A zero-coupon curve is used for discounting. The zero-coupon curve is adjusted upwards by means of a credit spread, which is to take account of the risk the bond entails. The credit spread is calculated on the basis of a spread curve taking account of the duration of the bond. Nordic Bond Pricing is the main source of spread curves. They provide company-specific curves for Norwegian savings banks, municipalities and energy. Savings banks have various spread curves based on total assets. For companies where Nordic Bond Pricing do not deliver spread curves, the Group use spread curves from three Norwegian banks. When spread curves are available from more than one of these banks, an equal-weighted average is used. If a bond lacks an appropriate spread curve, spread from a comparable bond from the same issuer is used.
Financial derivatives
These transactions are valued based on the applicable swap curve at the time of valuation. Derivative contracts are to be used only to hedge balance amounts and to enable payments obligations to be met. Derivative contracts may be struck only with counterparties with high credit quality.
Shares (unlisted)
For liquid shares and units, the closing price on the balance sheet date is used as the basis for measurement at fair value. If the prices are not quoted, the last price traded is used. Illiquid shares are priced on the basis of the Oslo Stock Exchange’s index algorithm based on the last traded prices. If the price picture is out of date, a derived valuation is produced from relevant equity indices or other similar securities. If this is also considered unsatisfactory, a discretionary valuation is made in which the Company’s financial key figures, broker assessment etc. are used.
Fair value of loans to retail customers
The fair value through profit/loss is calculated by discounting contractual cash flows to present values. The discount rate is determined as the market rate, including a suitable risk margin. For loans measured at fair value through other comprehensive income, the fair value is calculated as the recognised principal minus estimated loss provisions on loans classified in Stage 2 and 3 (see note 14 Loan losses provision).
Fair value of loans to Norwegian local administrations
The fair value of these loans is considered to be virtually the same as the book value, as the contract terms are constantly adjusted in line with market interest rates. The fair value of fixed rate loans is calculated by discounting contractual cash flows by market interest rates including a suitable risk margin at the end of the reporting period. This is valued at Level 2 in the valuation hierarchy, cf. Note 6.
Fair value of deposits
The fair value of floating rate deposits is taken to be approximately equal to the deposit amount including accrued interest. The fair value of fixed rate deposits is calculated by discounting contractual cash flows by market interest rates including a suitable risk margin. Discounting contractual cash flows by market interest rates including a suitable risk margin.
Fair value of loans to and receivables from credit institutions
All receivables from credit institutions (bank deposits) are at variable interest rates. The fair value of these is considered to be virtually the same as the book value, as the contract terms are continuously changed in step with change in market interest rates. This is valued at Level 2 in the valuation hierarchy, cf. Note 6.
Liabilities created on issuance of securities
Fair value in this category is determined on the basis of internal valuation models based on external observable data. This is valued in Level 2 in the valuation hierarchy, cf. Note 6.
Note 6 Fair value hierarchy
31.03.2022 NOK THOUSANDS | Level 1 | Level 2 | Level 3 | Total |
---|---|---|---|---|
ASSETS BOOKED AT FAIR VALUE | ||||
Fixed-income securities | 723 418 | 5 327 743 | 0 | 6 051 162 |
Shareholdings | 0 | 0 | 1 187 | 1 187 |
Financial derivatives | 0 | 87 724 | 0 | 87 724 |
Total assets at fair value | 723 418 | 5 415 467 | 1 187 | 6 140 073 |
LIABILITIES BOOKED AT FAIR VALUE | ||||
Financial derivatives (liabilities) | 0 | 17 111 | 0 | 17 111 |
Total financial liabilities at fair value | 0 | 17 111 | 0 | 17 111 |
31.03.2021 NOK THOUSANDS | Level 1 | Level 2 | Level 3 | Total |
---|---|---|---|---|
ASSETS BOOKED AT FAIR VALUE | ||||
Fixed-income securities | 837 101 | 2 426 711 | 0 | 3 263 812 |
Shareholdings | 0 | 0 | 1 197 | 1 197 |
Financial derivatives | 0 | 45 859 | 0 | 45 859 |
Total assets at fair value | 837 101 | 2 472 570 | 1 197 | 3 310 867 |
LIABILITIES BOOKED AT FAIR VALUE | ||||
Financial derivatives (liabilities) | 0 | 53 550 | 0 | 53 550 |
Total financial liabilities at fair value | 0 | 53 550 | 0 | 53 550 |
31.12.2021 NOK THOUSANDS | Level 1 | Level 2 | Level 3 | Total |
---|---|---|---|---|
ASSETS BOOKED AT FAIR VALUE | ||||
Fixed-income securities | 595 610 | 5 405 489 | 0 | 6 001 099 |
Shareholdings | 0 | 0 | 1 187 | 1 187 |
Financial derivatives | 0 | 42 051 | 0 | 42 051 |
Total assets at fair value | 595 610 | 5 447 540 | 1 187 | 6 044 337 |
LIABILITIES BOOKED AT FAIR VALUE | ||||
Financial derivatives (liabilities) | 0 | 9 990 | 0 | 9 990 |
Total financial liabilities at fair value | 0 | 9 990 | 0 | 9 990 |
NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 |
---|---|---|---|
CHANGES IN LEVEL 3 UNLISTED SHARES | |||
Opening balance | 1 187 | 1 197 | 1 197 |
Additions/purchases of shares | 0 | 0 | 77 |
Unrealized changes | 0 | 0 | -87 |
Closing balance | 1 187 | 1 197 | 1 187 |
Realized gains/losses | 0 | 0 | 0 |
Fair value shall be a representative price based on what a corresponding asset or liability would have been traded for at normal market terms and conditions. Highest quality in regard to fair value is based on listed prices in an active market. A financial instrument is considered as listed in an active market if listed prices are simply and regularly available from a stock market, dealer, broker, industry group, price-setting service or regulatory authority, and these prices represent actual and regularly occurring transactions at arm's length.
LEVEL 1:
Instruments at this level obtain fair value from listed prices in an active market for identical assets or liabilities to which the entity has access at the reporting date. Examples of instruments in Level 1 are stock market listed securities.
LEVEL 2:
Instruments at this level obtain fair value from observable market data. This includes prices based on identical instruments, but where the instrument does not maintain a high enough trading frequency and is therefore not considered to be traded in an active market, as well as prices based on corresponding assets and price-leading indicators that can be confirmed from market information. Example instruments at Level 2 are fixed-income securities priced on the basis of interest rate paths.
LEVEL 3:
Instruments at Level 3 contain non-observable market data or are traded in markets considered to be inactive. The price is based generally on discrete calculations where the actual fair value may deviate if the instrument were to be traded.
Note 5 discloses the fair value of financial assets and financial liabilities that are recognized at amortized cost and according to the rules on hedge accounting. Financial assets measured at amortized cost and hedge accounting comprise lending to and due to credit institutions, Norwegian municipalities and retail customers. The stated fair value of these assets is determined on terms qualifying for level 2. Financial liabilities recognized at amortized cost and hedge accounting consist of debt securities issued and deposits. The stated fair value of these liabilities is determined by methods qualifying for level 2.
There have been no transfers between level 1 and level 2.
Note 7 Debt securities issued - stock exchange listed covered bonds and certificates
NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 |
---|---|---|---|
Bond debt, nominal amount | 33 849 260 | 27 972 877 | 33 426 640 |
Adjustments | 22 250 | 52 767 | 60 603 |
Accrued interest | 52 674 | 32 716 | 38 554 |
Own holdings, nominal amount | -2 062 000 | -911 000 | -1 608 000 |
Total debt securities issued | 31 862 183 | 27 147 360 | 31 917 798 |
Interest rate on borrowings through the issuance of securities at the reporting date: | 1.5 % | 0.8 % | 1.1 % |
The interest rate is calculated as a weighted average of the act/360 basis. It includes interest rate effects and amortization costs. |
NOK THOUSANDS | Balance sheet 31.12.2021 | Issued | Matured/ redeemed | Other adjustements | Balance sheet 31.03.2022 |
---|---|---|---|---|---|
Changes in debt securities issued - stock exchange listed covered bonds and cerftificates | |||||
Bond debt, nominal amount | 33 426 640 | 1 500 000 | -1 076 000 | -1 380 | 33 849 260 |
Adjustments | 60 603 | 0 | 0 | -38 353 | 22 250 |
Accrued interest | 38 554 | 0 | 0 | 14 120 | 52 674 |
Own holdings, nominal amount | -1 608 000 | 0 | -454 000 | 0 | -2 062 000 |
Total debt securities issued | 31 917 798 | 1 500 000 | -1 530 000 | -25 613 | 31 862 183 |
Note 8 Financial assets and liabilities subject to net settlement
31.03.2022 NOK THOUSANDS | Related sums that are not presented net | |||||
---|---|---|---|---|---|---|
Gross financial assets/liabilites | Gross assets/ liabilities presented net | Book value | Financial instruments | Security in cash | Net recognised value | |
ASSETS | ||||||
Financial derivatives | 87 724 | 0 | 87 724 | -17 111 | 0 | 70 613 |
Total | 87 724 | 0 | 87 724 | -17 111 | 0 | 70 613 |
LIABILITIES | ||||||
Financial derivatives | 17 111 | 0 | 17 111 | -17 111 | -1 704 | 0 |
Total | 17 111 | 0 | 17 111 | -17 111 | -1 704 | 0 |
31.03.2021 NOK THOUSANDS | Related sums that are not presented net | |||||
---|---|---|---|---|---|---|
Gross financial assets/liabilites | Gross assets/ liabilities presented net | Book value | Financial instruments | Security in cash | Net recognised value | |
ASSETS | ||||||
Financial derivatives | 45 859 | 0 | 45 859 | -37 028 | 0 | 8 831 |
Total | 45 859 | 0 | 45 859 | -37 028 | 0 | 8 831 |
LIABILITIES | ||||||
Financial derivatives | 53 550 | 0 | 53 550 | -37 028 | -3 622 | 14 600 |
Total | 53 550 | 0 | 53 550 | -37 028 | -3 622 | 14 600 |
31.12.2021 NOK THOUSANDS | Related sums that are not presented net | |||||
---|---|---|---|---|---|---|
Gross financial assets/liabilites | Gross assets/ liabilities presented net | Book value | Financial instruments | Security in cash | Net recognised value | |
ASSETS | ||||||
Financial derivatives | 42 051 | 0 | 42 051 | -9 200 | 0 | 32 851 |
Total | 42 051 | 0 | 42 051 | -9 200 | 0 | 32 851 |
LIABILITIES | ||||||
Financial derivatives | 9 990 | 0 | 9 990 | -9 200 | -3 628 | 0 |
Total | 9 990 | 0 | 9 990 | -9 200 | -3 628 | 0 |
The purpose of the note is to show the potential effect of netting agreements at the KLP Banken Group . | ||||||
The note shows derivative positions in the financial position statement. |
Note 9 Transactions with related parties
NOK THOUSANDS | Q1 2022 | Q1 2021 | 01.01.2021 -31.12.2021 |
---|---|---|---|
KLP, fees lending management | 15 118 | 14 850 | 59 400 |
KLP Kapitalforvaltning AS, fees for services provided | 0 | 0 | -171 |
KLP, rent | -620 | -666 | -2 699 |
KLP Skipsbygget AS, rent | -434 | -417 | -1 727 |
KLP Bassengtomten AS, rent parking | -22 | -22 | -87 |
KLP Eiendomsdrift AS, cost office buildings | -242 | -158 | -366 |
KLP, pension premium | -3 582 | -3 246 | -13 140 |
KLP, staff services (at cost) | -19 155 | -17 162 | -68 399 |
KLP Group companies, subsidised interest employee loans | 3 117 | 2 869 | 11 825 |
NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 |
---|---|---|---|
BALANCES | |||
KLP, net internal accounts | -6 116 | -870 | -1 667 |
KLP, loan settlement | -4 215 | -8 407 | -1 333 |
KLP Group companies, net other internal accounts | 1 053 | 968 | 1 046 |
Transactions with related parties are carried out at general market terms, with the exception of the company's share of common functions, which are allocated at cost. Allocation is based on actual use. All internal receivables are settled as they arise. |
Note 10 Other assets
NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 |
---|---|---|---|
Intercompany receivables | 2 200 | 2 095 | 2 196 |
Miscellaneous receivables | 0 | 114 | 0 |
Prepaid expenses | 129 | 0 | 21 |
Total other assets | 2 329 | 2 209 | 2 217 |
Note 11 Other liabilities and provision for accrued costs
NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 |
---|---|---|---|
Creditors | 895 | 3 196 | 2 867 |
Intercompany payables | 11 478 | 10 404 | 4 150 |
Other liabilities | 76 092 | 27 976 | 31 352 |
Total other liabilities | 88 465 | 41 576 | 38 369 |
Withholding tax | 1 741 | 1 632 | 2 813 |
Social security contributions | 1 800 | 1 765 | 2 265 |
Capital activity tax | 659 | 641 | 820 |
Holiday pay | 7 920 | 7 485 | 6 273 |
Pension obligations | 20 923 | 35 058 | 36 693 |
VAT | 61 | 22 | 211 |
Provisioned costs | 14 651 | 8 506 | 3 176 |
Total accrued costs and liabilities | 47 755 | 55 109 | 52 249 |
Note 12 Capital adequacy
NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 |
---|---|---|---|
Share capital and share premium fund | 1 890 000 | 1 890 000 | 1 890 000 |
Other owners' equity | 602 142 | 536 801 | 630 782 |
Total owners' equity | 2 492 142 | 2 426 801 | 2 520 782 |
Adjustments due to requirements for proper valuation | -6 051 | -4 529 | -6 001 |
Deduction goodwill and other intangible assets | -16 475 | -17 751 | -16 789 |
Deferred tax asset | -5 723 | 0 | 0 |
Core capital/Tier 1 capital | 2 463 893 | 2 404 522 | 2 497 992 |
Supplementary capital/Tier 2 capital | 0 | 0 | 0 |
Supplementary capital/Tier 2 capital | 0 | 0 | 0 |
Total eligible own funds (Tier 1 and Tier 2 capital) | 2 463 893 | 2 404 522 | 2 497 992 |
Capital requirement | 1 090 942 | 998 309 | 1 070 801 |
Surplus of own funds (Tier 1 and Tier 2 capital) | 1 372 951 | 1 406 213 | 1 427 191 |
Estimate basis credit risk: | |||
Institutions | 235 184 | 442 721 | 286 512 |
Retail | 280 638 | 283 835 | 302 739 |
Local and regional authorities (incl. municipalities/county administations) | 3 640 816 | 3 347 270 | 3 628 147 |
Investments with mortgage security in real estate | 8 041 900 | 7 378 003 | 7 824 605 |
Investments fallen due | 47 029 | 44 015 | 36 584 |
Covered bonds | 508 578 | 227 361 | 498 905 |
Other holdings | 197 735 | 113 975 | 131 535 |
Calculation basis credit risk | 12 951 880 | 11 837 181 | 12 709 027 |
Credit risk | 1 036 150 | 946 974 | 1 016 722 |
Operating risk | 53 416 | 51 225 | 53 416 |
Credit valuation adjustments (CVA) | 1 376 | 110 | 663 |
Total capital requirement assets | 1 090 942 | 998 309 | 1 070 801 |
Core capital adequacy ratio | 18.1 % | 19.3 % | 18.7 % |
Supplementary capital ratio | 0.0 % | 0.0 % | 0.0 % |
Capital adequacy ratio | 18.1 % | 19.3 % | 18.7 % |
Leverage ratio | 5.1 % | 5.5 % | 5.2 % |
CAPITAL REQUIREMENT PER 31.03.2022 | Core capital/Tier 1 capital | Supplementary capital/Tier 2 capital | Own funds |
---|---|---|---|
Minimum requirement excl. buffers | 4.5 % | 3.5 % | 8.0 % |
Protective buffer | 2.5 % | 0.0 % | 2.5 % |
Systemic risk buffer | 3.0 % | 0.0 % | 3.0 % |
Counter-cyclical capital buffer | 1.0 % | 0.0 % | 1.0 % |
Pilar 2-requirement | 1.5 % | 0.0 % | 1.5 % |
Current capital requirement incl. buffers | 12.5 % | 3.5 % | 16.0 % |
Capital requirement leverage ratio | 3.0 % | 0.0 % | 3.0 % |
Note 13 Fixed-income securities
NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 | |||
---|---|---|---|---|---|---|
Acquisition cost | Market value | Acquisition cost | Market value | Acquisition cost | Market value | |
Certificates | 523 201 | 523 241 | 608 842 | 608 837 | 567 264 | 567 443 |
Bonds | 5 539 938 | 5 527 921 | 2 646 406 | 2 654 975 | 5 437 376 | 5 433 656 |
Total fixed-income securities | 6 063 139 | 6 051 162 | 3 255 248 | 3 263 812 | 6 004 640 | 6 001 099 |
Fixed income securities are brought to account at market value, including accrued but not due interests. |
Note 14 Loan loss provision
In the first quarter of 2022 the companies has made adjustments in the expected loss model for credit cards. Based on validation of the bank’s loss models, the loss rate for credit cards at stage 1 has been reduced, while the loss rate at stage 2 and 3 has been increased. The total provisions for expected loss shall be at the same level as before.
The total loan loss provisions in KLP Banken AS is nevertheless decreased by 17 percent and by 17 percent on the group level. The decrease is due to the fact that more credit cards are at level 1 then level 2 since the previous quarter, and that the individual loss write-downs have been reduced this quarter.
Refer to Note 10 and Note 2 in the annual report for more details of the model.
Expected credit loss (ECL) loans to customers - all segments
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Opening balance ECL 01.01.2022 | 4 346 | 282 | 1 753 | 6 382 |
Transfer to stage 1 | 70 | -59 | -11 | 0 |
Transfer to stage 2 | -17 | 18 | -1 | 0 |
Transfer to stage 3 | -1 | -24 | 25 | 0 |
Net changes | 86 | 57 | -448 | -305 |
New losses | 107 | 15 | 0 | 122 |
Write-offs | -305 | -39 | -186 | -530 |
Change in risk model | -1 933 | 1 033 | 549 | -351 |
Closing balance ECL 31.03.2022 | 2 353 | 1 283 | 1 681 | 5 317 |
Changes (01.01.2022 - 31.03.2022) | -1 993 | 1 001 | -72 | -1 065 |
Expected credit loss (ECL) loans to customers - mortgage
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Opening balance ECL 01.01.2022 | 159 | 121 | 1 497 | 1 776 |
Transfer to stage 1 | 5 | -5 | 0 | 0 |
Transfer to stage 2 | 0 | 0 | 0 | 0 |
Transfer to stage 3 | 0 | -8 | 8 | 0 |
Net changes | -51 | 22 | -413 | -442 |
New losses | 31 | 15 | 0 | 47 |
Write-offs | -21 | -35 | -154 | -211 |
Closing balance ECL 31.03.2022 | 122 | 110 | 937 | 1 170 |
Changes (01.01.2022 - 31.03.2022) | -37 | -10 | -559 | -606 |
Expected credit loss (ECL) - public lending
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Opening balance ECL 01.01.2022 | 176 | 0 | 0 | 176 |
Transfer to stage 1 | 0 | 0 | 0 | 0 |
Transfer to stage 2 | 0 | 0 | 0 | 0 |
Transfer to stage 3 | 0 | 0 | 0 | 0 |
Net changes | -3 | 0 | 0 | -3 |
New losses | 5 | 0 | 0 | 5 |
Write-offs | -1 | 0 | 0 | -1 |
Closing balance ECL 31.03.2022 | 177 | 0 | 0 | 177 |
Changes (01.01.2022 - 31.03.2022) | 1 | 0 | 0 | 1 |
Expected credit loss (ECL) - credit card
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Opening balance ECL 01.01.2022 | 3 987 | 161 | 67 | 4 215 |
Transfer to stage 1 | 64 | -57 | -7 | 0 |
Transfer to stage 2 | -17 | 18 | -1 | 0 |
Transfer to stage 3 | -1 | -17 | 18 | 0 |
Net changes | 95 | 35 | -1 | 129 |
New losses | 69 | 0 | 0 | 69 |
Write-offs | -276 | -4 | 0 | -280 |
Change in risk model | -1 882 | 1 033 | 567 | -282 |
Closing balance ECL 31.03.2022 | 2 039 | 1 170 | 642 | 3 851 |
Changes (01.01.2022 - 31.03.2022) | -1 948 | 1 009 | 576 | -364 |
Expected credit loss (ECL) loans to customers - senior loans
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Opening balance ECL 01.01.2022 | 19 | 0 | 0 | 19 |
Transfer to stage 1 | 0 | 0 | 0 | 0 |
Transfer to stage 2 | 0 | 0 | 0 | 0 |
Transfer to stage 3 | 0 | 0 | 0 | 0 |
Net changes | 0 | 0 | 0 | 0 |
New losses | 1 | 0 | 0 | 1 |
Write-offs | -1 | 0 | 0 | -1 |
Closing balance ECL 31.03.2022 | 19 | 0 | 0 | 19 |
Changes (01.01.2022 - 31.03.2022) | 0 | 0 | 0 | 0 |
Expected credit loss (ECL) loans to customers - overdrafts deposit accounts
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Opening balance ECL 01.01.2022 | 5 | 0 | 190 | 195 |
Transfer to stage 1 | 4 | 0 | -4 | 0 |
Transfer to stage 2 | 0 | 0 | 0 | 0 |
Transfer to stage 3 | 0 | 0 | 0 | 0 |
Net changes | 45 | 0 | -34 | 11 |
Write-offs | -5 | 0 | -32 | -36 |
Change in risk model | -51 | 0 | -18 | -69 |
Closing balance ECL 31.03.2022 | 0 | 0 | 101 | 101 |
Changes (01.01.2022 - 31.03.2022) | -5 | 0 | -89 | -94 |
Book value of loans and receivables from customers - all segments
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Lending 01.01.2022 | 39 404 432 | 527 587 | 35 954 | 39 967 973 |
Transfer to stage 1 | 283 325 | -283 017 | -308 | 0 |
Transfer to stage 2 | -22 213 | 22 277 | -64 | 0 |
Transfer to stage 3 | -4 695 | -6 805 | 11 499 | 0 |
Net changes | -314 638 | -3 434 | -277 | -318 349 |
New losses | 3 903 818 | 1 636 | 0 | 3 905 454 |
Write-offs | -2 798 377 | -56 138 | -1 160 | -2 855 675 |
Lending 31.03.2022 | 40 451 652 | 202 106 | 45 646 | 40 699 403 |
Book value of loans and receivables from customers - mortgages
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Lending 01.01.2022 | 19 782 618 | 524 203 | 33 565 | 20 340 386 |
Transfer to stage 1 | 281 967 | -281 825 | -142 | 0 |
Transfer to stage 2 | -21 355 | 21 390 | -35 | 0 |
Transfer to stage 3 | -4 559 | -6 259 | 10 817 | 0 |
Net change | -122 060 | -3 226 | 345 | -124 942 |
New lending | 3 278 637 | 1 636 | 0 | 3 280 273 |
Write-offs | -2 622 110 | -56 107 | -1 129 | -2 679 345 |
Lending 31.03.2022 | 20 573 139 | 199 813 | 43 422 | 20 816 373 |
Book value of loans and receivables from customers - public lending
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Lending 01.01.2022 | 17 875 934 | 0 | 0 | 17 875 934 |
Transfer to stage 1 | 0 | 0 | 0 | 0 |
Transfer to stage 2 | 0 | 0 | 0 | 0 |
Transfer to stage 3 | 0 | 0 | 0 | 0 |
Net change | -211 608 | 0 | 0 | -211 608 |
New lending | 515 344 | 0 | 0 | 515 344 |
Write-offs | -118 142 | 0 | 0 | -118 142 |
Lending 31.03.2022 | 18 061 528 | 0 | 0 | 18 061 528 |
Book value of loans and receivables from customers - credit card
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Lending 01.01.2022 | 38 284 | 3 383 | 2 202 | 43 869 |
Transfer to stage 1 | 1 354 | -1 192 | -162 | 0 |
Transfer to stage 2 | -858 | 886 | -28 | 0 |
Transfer to stage 3 | -136 | -546 | 682 | 0 |
Net change | 581 | -208 | -611 | -238 |
New lending | 860 | 0 | 0 | 860 |
Write-offs | -131 | -31 | 0 | -162 |
Lending 31.03.2022 | 39 953 | 2 293 | 2 082 | 44 329 |
Book value of loans to receivables from customers - senior loans
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Lending 01.01.2022 | 1 707 532 | 0 | 0 | 1 707 532 |
Transfer to stage 1 | 0 | 0 | 0 | 0 |
Transfer to stage 2 | 0 | 0 | 0 | 0 |
Transfer to stage 3 | 0 | 0 | 0 | 0 |
Net change | 18 378 | 0 | 0 | 18 378 |
New lending | 108 924 | 0 | 0 | 108 924 |
Write-offs | -57 989 | 0 | 0 | -57 989 |
Lending 31.03.2022 | 1 776 845 | 0 | 0 | 1 776 845 |
Book value of loans to receivables from customers - overdraft deposit accounts
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Lending 01.01.2022 | 65 | 0 | 188 | 252 |
Transfer to stage 1 | 4 | 0 | -4 | 0 |
Transfer to stage 2 | 0 | 0 | 0 | 0 |
Transfer to stage 3 | 0 | 0 | 0 | 0 |
Net change | 71 | 0 | -11 | 61 |
New lending | 52 | 0 | 0 | 52 |
Write-offs | -5 | 0 | -31 | -37 |
Lending 31.03.2022 | 187 | 0 | 141 | 329 |
Exposure - unused credit
NOK THOUSANDS | 12 months ECL | Lifetime ECL (not credit impaired) | Lifetime ECL (credit impaired) | |
---|---|---|---|---|
stage 1 | stage 2 | stage 3 | Total stage 1-3 | |
Lending 01.01.2022 | 1 158 308 | 62 601 | 153 | 1 221 062 |
Transfer to stage 1 | 8 058 | -8 001 | -57 | 0 |
Transfer to stage 2 | -8 388 | 8 390 | -3 | 0 |
Transfer to stage 3 | -5 | -31 | 36 | 0 |
Net change | 10 146 | 1 588 | 166 | 11 900 |
New lending | 70 360 | 0 | 0 | 70 360 |
Write-offs | -29 111 | -315 | 0 | -29 426 |
Lending 31.03.2022 | 1 209 368 | 64 232 | 295 | 1 273 895 |
Losses recognised in the profit and loss account consist of:
NOK THOUSANDS | Q1 2022 | Q1 2021 | 01.01.2021 -31.12.2021 |
---|---|---|---|
Change in loss provisions in stage 1, 2 and 3 | 623 | -613 | -2 509 |
Established losses | -707 | -4 | -356 |
Recovery for previously established losses | 147 | 84 | 566 |
Total losses in the income statement | 63 | -533 | -2 299 |
Note 15 Contingent liabilites
NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 |
---|---|---|---|
Credit facilities for lending not utilized | 1 016 359 | 809 019 | 949 244 |
Credit facilities issued credit card | 257 536 | 257 884 | 271 818 |
Loan promise | 1 826 723 | 1 327 060 | 1 458 520 |
Total contingent liabilities | 3 100 619 | 2 393 963 | 2 679 581 |
Credit facilities for lending not utilized: The ‘Fleksilån’ product is included here; this is a credit facility which allows the customer to borrow up to a specified credit limit.
Credit facilities issued credit card: Customers’ credit card limits are a contingent liability for the Bank, where the customer can choose to utilise the credit up to the allocated credit limit.
Loan commitment: The Bank issues funding certificates that customers can use in bidding procedures for home purchases. This also includes other loans that have been granted but not disbursed.
Note 16 Net gain/(loss) on financial instruments
NOK THOUSANDS | Q1 2022 | Q1 2021 | 01.01.2021 -31.12.2021 |
---|---|---|---|
Net gain/(loss) on fixed-income securities | -8 608 | 20 704 | -3 395 |
Net gain/(loss) financial derivatives and realized amortization linked to lending | 206 | 0 | -750 |
Net gain/(loss) financial derivatives and realized repurchase of own debt | -1 463 | -5 773 | -28 146 |
Net value change lending and borrowing, hedge accounting | 0 | -222 | 336 |
Other financial income and expenses | -242 | -242 | -941 |
Total net gain/(loss) on financial instruments | -10 107 | 14 467 | -32 896 |
Note 17 Leases
NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 |
---|---|---|---|
Property | |||
RIGHT-OF-USE ASSETS | |||
Opening balance 01.01. | 18 236 | 1 948 | 1 948 |
Depreciation | -468 | -390 | -1 636 |
Deduction | 0 | 0 | -779 |
Addition | 0 | 0 | 18 703 |
Closing balance | 17 768 | 1 558 | 18 236 |
LEASE LIABILITIES | |||
Opening balance 01.01. | 18 323 | 2 023 | 2 023 |
Repayments | -386 | -397 | -1 582 |
Deduction | 0 | 0 | -821 |
Addition | 0 | 0 | 18 703 |
Closing balance | 17 938 | 1 626 | 18 323 |
NOK THOUSANDS | Q1 2022 | Q1 2021 | 01.01.2021 -31.12.2021 |
---|---|---|---|
Property | |||
Interest expense lease liabilities | 83 | 9 | 109 |
Interest expense lease liabilities | 83 | 9 | 109 |
In the fourth quarter of 2021, a new 10-year lease has been capitalized. It is an intercompany lease for the rental of office premises with KLP Eiendom. |
Note 18 Pension obligations - own employees
NOK THOUSANDS | 31.03.2022 | 31.03.2021 | 31.12.2021 |
---|---|---|---|
Capitalized net liability | 36 693 | 41 550 | 41 550 |
Pension costs taken to profit/loss | 3 582 | 3 246 | 12 983 |
Finance costs taken to profit/loss | 242 | 243 | 942 |
Actuarial gains and losses incl. social security contributions | -18 113 | -7 732 | -7 136 |
Premiums/supplement paid-in including admin | -1 480 | -2 249 | -11 646 |
Capitalized net liability | 20 923 | 35 058 | 36 693 |
ASSUMPTIONS | 31.03.2022 | 31.03.2021 | 31.12.2021 |
---|---|---|---|
Discount rate | 2.70% | 2.00% | 1.90 % |
Salary growth | 2.75% | 2.25% | 2.75 % |
The National Insurance basic amount (G) | 2.50% | 2.00% | 2.50 % |
Pension increases | 1.75% | 1.24% | 1.75 % |
Social security contribution | 14.10% | 14.10% | 14.10 % |
Capital activity tax | 5.00% | 5.00% | 5.00 % |
The effect of changes in the assumptions is a reduction of the obligation by NOK 18.1 million as of 31.03.2022. The change is recognized in comprehensive income. |
Quarterly earnings trend
NOK MILLIONS | Q1 2022 | Q4 2021 | Q3 2021 | Q2 2021 | Q1 2021 |
---|---|---|---|---|---|
Interest income | 206.4 | 185.2 | 166.5 | 170.2 | 167.9 |
Interest expense | -134.3 | -109.4 | -86.6 | -93.1 | -92.1 |
Net interest income | 72.1 | 75.8 | 80.0 | 77.1 | 75.7 |
Commision income and income from banking services | 5.7 | 6.0 | 5.7 | 5.2 | 4.6 |
Commision cost and cost from banking services | -0.5 | -0.6 | -0.6 | -0.5 | -0.4 |
Net charges and commission income | 5.2 | 5.4 | 5.2 | 4.7 | 4.2 |
Other fee income | 15.1 | 14.9 | 14.9 | 14.9 | 14.9 |
Net gain/(loss) financial instruments | -10.1 | -9.4 | -4.9 | -33.0 | 14.5 |
Total other operating income | 5.0 | 5.4 | 10.0 | -18.2 | 29.3 |
Salaries and administrative costs | -21.8 | -23.5 | -17.7 | -20.5 | -20.3 |
Depreciation | -1.0 | -1.4 | -1.7 | -1.7 | -1.7 |
Other operating expenses | -41.2 | -38.4 | -36.1 | -35.2 | -38.1 |
Net loan losses | 0.1 | -1.0 | -0.2 | -0.6 | -0.5 |
Total operating expenses | -64.0 | -64.3 | -55.6 | -58.0 | -60.6 |
Operating profit/loss before tax | 18.3 | 22.4 | 39.5 | 5.7 | 48.6 |
Tax ordinary income | 24.3 | -5.2 | -9.2 | -1.3 | 15.4 |
Profit/loss for the period | 42.6 | 17.1 | 30.2 | 4.4 | 64.0 |
Other comprehensive income | 18.1 | 18.7 | -19.3 | 0.0 | 7.7 |
Tax on other comprehensive income | -4.5 | -4.7 | 4.8 | 0.0 | -1.9 |
Other comprehensive income for the period | 13.6 | 14.0 | -14.5 | 0.0 | 5.8 |
Comprehensive income for the period | 56.2 | 31.1 | 15.8 | 4.4 | 69.8 |
Key figures – accumulated
NOK MILLIONS | Q1 2022 | Q4 2021 | Q3 2021 | Q2 2021 | Q1 2021 |
---|---|---|---|---|---|
Pre-tax income | 18.3 | 116.1 | 93.8 | 54.3 | 48.6 |
Net interest income | 72.1 | 308.6 | 232.8 | 152.8 | 75.7 |
Other operating income | 20.3 | 78.9 | 58.6 | 38.6 | 19.0 |
Other operating cost and depreciation | -64.0 | -238.5 | -174.2 | -118.6 | -60.6 |
Net gain/(loss) financial instruments | -10.1 | -32.9 | -23.5 | -18.6 | 14.5 |
Deposits | 13 372.2 | 12 901.0 | 12 773.7 | 12 642.6 | 12 103.2 |
Lending customers | 22 635.4 | 22 089.7 | 21 364.8 | 21 409.3 | 20 893.9 |
Lending with public sector guarantee | 17 974.4 | 17 844.4 | 16 842.2 | 16 752.1 | 16 734.4 |
Non-performing loans | 45.6 | 36.0 | 31.5 | 34.1 | 57.0 |
Total liabilities created on issuance of securities | 31 862.2 | 31 917.8 | 29 535.7 | 29 194.6 | 27 147.4 |
Other borrowing | 0.0 | 0.0 | 0.0 | 701.8 | 1 303.2 |
Total assets | 47 954.0 | 47 481.9 | 44 980.2 | 45 215.6 | 43 200.4 |
Average total assets | 47 717.9 | 45 084.9 | 43 834.1 | 43 951.8 | 42 944.2 |
Equity | 2 548.3 | 2 520.8 | 2 489.7 | 2 473.9 | 2 469.5 |
Interest net | 0.15 % | 0.68 % | 0.53 % | 0.35 % | 0.18 % |
Profit/loss from ordinary operation before taxes | 0.04 % | 0.26 % | 0.21 % | 0.12 % | 0.11 % |
Return on equity | 2.91 % | 4.78 % | 5.15 % | 4.47 % | 8.02 % |
Capital adequacy ratio | 18.1 % | 18.7 % | 18.6 % | 18.4 % | 19.3 % |
Liquidity coverage ratio (LCR) | 242 % | 495 % | 353 % | 438 % | 371 % |
Contact information
KLP BANKEN AS
Beddingen 8
7042 Trondheim
Organisation number: 993 821 837
Visitors adress, Trondheim:
Beddingen 8
Visitors adress, Oslo:
Dronning Eufemias gate 10
Phone: +47 55 54 85 00