11/29/2018 - 19:00

Republication of Municipality Finance Plc's Pillar III Disclosure Reports

Municipality Finance Plc
Stock exchange release
29 November 2018 at 7 p.m. (EET)

Republication of Municipality Finance Plc's Pillar III Disclosure Reports

Municipality Finance Plc (MuniFin) has republished Pillar III Disclosure Report 2017 and Pillar III Disclosure Report Half Year 2018 originally made public on 7 March 2018 and 14 August 2018, respectively. The Pillar III Disclosure Reports include information required by the EU Regulation No 575/2013.

These republished reports correct a technical error which has had an effect on MuniFin's ratio of tier 1 capital to risk-weighted assets (Tier 1 Ratio), ratio of common equity tier 1 to risk-weighted assets (CET 1 Ratio), and the ratio of total own funds to risk-weighted assets (Total Capital Adequacy Ratio).

In addition, and as was disclosed in the Pillar III Disclosure Report Half Year 2018, the revised calculations reflect the fact that the guarantees granted to MuniFin by the Municipal Guarantee Board in respect of certain derivative counterparties are not taken into account in credit value adjustment risk. In connection with these corrections, MuniFin has also clarified and revised certain elements in relation to calculations.

As a result of corrected calculations, MuniFin's Tier 1 Ratio, CET 1 Ratio, and Total Capital Adequacy Ratio are slightly lower in comparison to what was reported in the Pillar III Disclosure Report 2017 as well as the Annual Report 2017, and significantly higher in comparison to what was reported in the Pillar III Disclosure Report Half Year 2018 as well as the Half Year Report January-June 2018.

The republished and corrected consolidated figures:

31 December 2017 Published on 7 March 2018 Corrected figures Minimum capital requirement (with capital buffers) on 31 December 2017
CET 1 Ratio 55.22% 53.01% 7.84%
Tier 1 Ratio 75.51% 72.50% 9.34%
Total Capital Adequacy Ratio 75.51% 72.50% 11.34%

30 June 2018 Published on 14 August 2018 Corrected figures Minimum capital requirement (with capital buffers) on 30 June 2018
CET 1 Ratio 53.95% 61.01% 7.86%
Tier 1 Ratio 72.41% 81.89% 9.36%
Total Capital Adequacy Ratio 72.41% 81.89% 11.36%

The republished and corrected figures for the parent company:

31 December 2017 Published on 7 March 2018 Corrected figures Minimum capital requirement (with capital buffers) on 31 December 2017
CET 1 Ratio 55.71% 53.46% 7.84%
Tier 1 Ratio 76.22% 73.15% 9.34%
Total Capital Adequacy Ratio 76.22% 73.15% 11.34%

30 June 2018 Published on 14 August 2018 Corrected figures Minimum capital requirement (with capital buffers) on 30 June 2018
CET 1 Ratio 54.68% 61.95% 7.86%
Tier 1 Ratio 73.44% 83.20% 9.36%
Total Capital Adequacy Ratio 73.44% 83.20% 11.36%

The correction has no effect on MuniFin's ability to meet all its obligations. The republished and corrected figures exceed by far all capital requirements MuniFin is subject to. MuniFin has also committed itself to further improve all its processes to avoid any occurrence of similar errors.

Republished Pillar III Disclosure Report 2017 and Pillar III Disclosure Report Half Year Report 2018 are available on MuniFin's website at www.munifin.fi.

MUNICIPALITY FINANCE PLC

Further information:

Esa Kallio, President and CEO
tel. +358 50 3377 953

Marjo Tomminen, Executive Vice President, CFO, Finance
Tel. +358 50 3861 764

MuniFin (Municipality Finance Plc) is one of Finland's largest credit institutions: the company's balance sheet exceeds EUR 35 billion. The company is owned by Finnish municipalities, the public sector pension fund Keva and the Republic of Finland.

MuniFin's mission is to build a better future in line with the principles of responsibility and in cooperation with its customers. MuniFin's customers are Finnish municipalities, municipal federations, municipally controlled companies and non-profit housing corporations. Lending is used for environmentally and socially responsible investment targets such as public transportation, sustainable buildings, hospitals and healthcare centres, schools and day care centres, and homes for people with special needs.

MuniFin's customers are domestic but the company operates in a completely global business environment. It is the most active Finnish bond issuer in international capital markets and the first Finnish green bond issuer.  The funding is exclusively guaranteed by the Municipal Guarantee Board.

The Municipality Finance Group also includes the subsidiary company, Financial Advisory Services Inspira Ltd.

Read more: www.munifin.fi