19.3.2008
Full financial statements of Munifin
Municipality Finance continues controlled growth
The Municipality Finance Group’s loan portfolio increased by 15% in 2007, totaling EUR 5,849 million at the end of the year (Dec. 31, 2006: EUR 5,100 million). Customers were withdrawing a record amount of well over one billion euros of new loans. Municipality Finance Plc is the parent company of the Municipality Finance Group. Year 2007 annual results were the first consolidated accounts which have been drawn up in compliance with the International Financial Reporting Standards (IFRS).
“Municipality Finance Group’s financial year 2007 was good, and targets were exceeded. The full year net result is the best ever, and the other indicators for the financial year were also good. The strengthening market position gives us good prospects for the year 2008,” says CEO Pekka Averio.
In 2007 new loans granted were withdrawn to a value of well over one billion euros (totaling EUR 1,314 million, equivalent figure in 2006: EUR 1,010 million). Despite the tight competition the group continued to improve its position as a provider of financial services to municipalities and municipal federations.
The balance sheet of the Municipality Finance Group grew by some 23%, coming to EUR 8,913 million at the end of 2007 (December 31, 2006: EUR 7,235 million). Capital adequacy was 23.8% at the end of 2007 (December 31, 2006: 27.1%). The net operating profit for the financial period before taxes rose to EUR 8.8 million (December 31, 2006: EUR 7.1 million).
Successful funding
Municipality Finance Plc’s funding continued actively. During the financial year, a total of more than 200 funding arrangements were made, 11 of them domestic. In terms of volume, about 95% of all arrangements were international.
Asian countries, especially Japan, continued to be the most important funding region. In Europe, Denmark, German and Switzerland were the most active ones. In April the company launched its inaugural
AUD-denominated bond as the first ever Finnish issuer in the market.
Best credit ratings
The two important credit rating agencies, Standard & Poor’s and Moody’s confirmed the best possible credit ratings for Municipality Finance Plc during the financial year. Municipality Finance Plc is the only Finnish credit institution with the same ratings as the Republic of Finland.
“Our position on the international capital markets is reinforced by the best possible credit ratings given to Municipality Finance Plc and the Municipal Guarantee Board by both Moody’s and S & P, which represent a unique rating together. This promotes the competitiveness of our funding and improves its profitability, which again benefits, above all, our clientele, i.e. the Finnish municipalities”, says CEO Pekka Averio.
Distributable dividend
The company’s distributable funds total EUR 2,659,746.80. It is proposed that a total of EUR 2,633,163.60, or EUR 0.10 per share, be distributed from these funds as dividend.
Municipality Finance Plc
Further information:
CEO Pekka Averio, tel. +358 9 6803 6211, +358 500 406 856
Director Marjo Tomminen, tel. +358 9 6803 5665, +358 50 386 1764
The full financial statements of Municipality Finance Plc are available on our website at www.munifin.fi.
Municipality Finance Plc is a local government credit institution owned by Finnish municipalities and the Local Government Pensions Institution and is the parent company of the Municipal Finance Group. The company’s mission is to ensure top-value financial services for the municipal sector, to be efficient and to grow profitably. The company’s balance sheet totalled over EUR 8,913 million on December 31, 2007. The company offers market-based funding to municipalities and municipal federations, to municipality-controlled entities and non-profit housing corporations. The company’s funding, which is guaranteed by the Municipal Guarantee Board is obtained from international capital markets and domestic investors. Funding provided by the company goes into social and non-profit service projects, such as schools, housing and hospitals.
The Group includes Financial Advisory Services Inspira Ltd, which offers financial advisory services for investments, financial and asset arrangements, asset management and various analysis services.
