Pohjola Pankki Oyj: A 3.25% return target for OP-Pohjola cooperative banks' Income Shares

 Pohjola Pankki Oyj: A 3.25% return target for OP-Pohjola cooperative banks'
                                Income Shares

At the end of March, the first OP-Pohjola Group cooperative banks will launch
Income Shares which provide customer-owners with a way of investing in their
own OP-Pohjola cooperative banks. A cooperative bank will annually pay
interest on Income Shares on the basis of its financial performance. The
return target for 2014 is 3.25%. It will be confirmed annually.

- An Income Share forms a new investment instrument available only to
OP-Pohjola Group cooperative banks' customer-owners. It has features of both
an equity and fixed-income investment. With a sum as small as 100 euros,
customer-owners can become investors. Income Shares have been designed as
long-term investments on which the bank will annually pay interest, explains
Timo Liukkonen, Executive Vice President of Banking, OP-Pohjola Group.

- The first Group cooperative banks will begin to sell Income Shares at the
end of March: Turun Seudun Osuuspankki on 19 March and Keski-Uudenmaan
Osuuspankki on 20 March. Other Group cooperative banks will gradually follow
suit during the spring according to their own schedules. Helsinki OP Bank Plc
is a limited company which intends to issue a debenture loan during the

Before selling Income Shares, each Group cooperative bank must approve
alterations of the Cooperative Bylaws required for their sale. The governing
bodies of the cooperative banks will meet on slightly different dates to
decide on this matter.

Opportunity to invest in one's own Group cooperative bank

An Income Share is an equity investment. Each cooperative bank's Annual
Cooperative Meeting or Representative Assembly will annually confirm
afterwards interest on the Income Share. Interest will be paid, provided that
the cooperative bank concerned has distributable reserves.

- As banks with a very good financial standing, cooperative banks are good at
meeting this criteria. At OP-Pohjola Group, the aim is that interest payable
on Income Shares would be as consistent as possible across Group cooperative
banks. The 3.25% return target is quite a competitive interest rate compared
with other instruments in the market, points out Liukkonen.

- Banks will be subject to ever-tightening regulation as a result of, for
example, the new CRD IV and CRR within the EU. Given that the minimum
requirements for capital adequacy actually double, stronger capital buffers
are required. In February, OP-Pohjola Group increased its target for the CET1
ratio to 18%: Income Shares will play an important role in achieving this
target, in addition to measures aimed at improving profitability.

- OP-Pohjola Group has a strong and solid capital base, points out Liukkonen.

- We aim to further improve it in the long term. A strong capital base is a
bedrock on which a lot of things are built; for example the ability to provide
customers with financing and a good credit rating.

- As a financial services group owned by our customers, we can offer them a
long-term investment with a reasonable risk, which supplements benefits from
using us as their main bank and insurer, concludes Liukkonen. 

For more information, please contact:
Timo Liukkonen, Executive Vice President, Banking, OP-Pohjola, tel. +358 (0)10
252 4061


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Source: Pohjola Pankki Oyj via Globenewswire
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