Municipality Finance Plc
Stock exchange release
8 March 2016 at 15:45 (EET)
Proposals to the Annual General Meeting of Municipality Finance Plc
The Board of Directors and the Shareholders’ Nomination Committee has made the following proposals to the Annual General Meeting (hereinafter “AGM”) convening on 22 March 2016 at 15:00 (EET):
Use of profit shown on the balance sheet
The Municipality Finance Plc (“hereinafter MuniFin”) has distributable funds of EUR 54,688,359.49, of which the profit for the financial year totaled EUR 1,530,009.22. The Board proposes to the AGM that no dividend be paid out, and that the distributable funds of EUR 54,688,359.49 be retained in equity. The Board of Directors considers this to be a well-reasoned decision, as the company needs to continue preparing for tightening own funds requirements by increasing its Tier 1 capital through profit and loss.
Remuneration and composition of the Board of Directors
The Shareholders’ Nomination Committee proposes to the AGM the following remuneration of the Board of Directors for the term following from the closing of the 2016 AGM, to the closing of the next AGM (hereinafter the “term 2016 – 2017”): annual remuneration of a Board member EUR 15,000; annual remuneration of the Vice Chairman of the Board EUR 18,000; annual remuneration of the Chairman of the Board EUR 30,000; a meeting fee of EUR 500 per Board and committee meeting to members; and EUR 800 per meeting to the chairmen. The remuneration corresponds with the remuneration paid for the previous term.
The Shareholders’ Nomination Committee proposes to the AGM that eight members will be elected to the Board of Directors for the term 2016 – 2017 and the following current members will be re-elected: Mr. Fredrik Forssell, Mr. Tapani Hellstén, Mr. Teppo Koivisto, Ms. Sirpa Louhevirta, Ms. Tuula Saxholm, and Mr. Juha Yli-Rajala. As Ms. Eva Liljeblom and Ms. Asta Tolonen have announced not to be available to the Board of Directors for the term 2016 – 2017, the Shareholders’ Nomination Committee proposes the election of Ms. Helena Walldén and Ms. Vivi Marttila as new members of the Board of Directors. Helena Walldén is currently chairing the Board of Directors of Fingrid Oyj and is a member of the Board of Directors of Raskone Oyj. She has long financial sector experience from the OP-Pohjola Group. Vivi Marttila is mayor of the Municipality of Simo and she has also a long history in auditing services. The Shareholders’ Nomination Committee proposes to the Board of Directors to be elected by the AGM to appoint Helena Walldén as the Chairwoman and Tapani Hellstén as the Vice Chairman.
Election and remuneration of the Auditor
The Board of Directors proposes to the AGM to re-elect KPMG Oy Ab as the company’s auditor for the term 2016 – 2017. KPMG Oy Ab has announced that Mr. Marcus Tötterman, APA, would be the Auditor with principal responsibility as has been the case during the previous term. The Board of Directors proposes to the AGM that the auditor’s fees will be paid against reasonable invoices.
Amendment of the Articles of Association
The Board of Directors proposes to the AGM the amendment of the Articles of Association by removing the company’s right to redeem its own shares in order to meet the requirements of Regulation (EU) No 575/2013 (so called Capital Requirements Regulation) for Common Equity Tier 1 instruments. The amendment proposal is based on the interpretation by the Finnish Financial Supervisory Authority (hereinafter the “FIN-FSA), published on 27 January 2016. According to the interpretation by the FIN-FSA, credit institutions shall remove from the Articles of Association a right to redeem its own shares and take the matter on the agenda of the next general meeting. Since 1 January 2016 MuniFin is under the direct supervision of the European Central Bank (hereinafter “ECB”). After the decision of the AGM to amend the Articles of Association MuniFin has to apply for ECB approval for the inclusion of the shares into the company’s CET1 capital. MuniFin is unable to estimate the time schedule of the application process with the ECB.
In addition, the Board of Directors proposes a technical amendment of the Articles of Association concerning the method of delivering an invitation to the AGM.
The invitation to the AGM, including relevant appendices, is available on MuniFin’s website in Finnish.
MUNICIPALITY FINANCE PLC
Pekka Averio
President and CEO
tel. +358 500 406 856
MuniFin’s (Municipality Finance Plc) mission is to ensure competitive financial services for its customers in all market conditions. MuniFin’s balance sheet totals nearly EUR 34 billion, making it the third largest credit institution in Finland and an integral part of the Finnish public economy.
The company is owned by Finnish municipalities, the public sector pension fund Keva and the Republic of Finland. Its customers are Finnish municipalities, municipal federations, municipally controlled companies and non-profit housing corporations. Importantly, a significant portion of lending is used for socially responsible projects such as building hospitals, healthcare centers, schools, day care centers and homes for the elderly.
MuniFin’s funding is primarily obtained through the international capital markets. The funding is guaranteed by the Municipal Guarantee Board.
The Municipality Finance Group also includes the subsidiary company, Financial Advisory Services Inspira Ltd.