RNS Number:9617O
Spintab AB
22 August 2003
Q2, 2003
Interim report
January - June 2003
Spintab
JANUARY - JUNE 2003 IN SUMMARY
* Net interest income increased to SEK 2,425 million (2,271)
* Loan Losses declined to SEK 80 million (103)
* Operating profit rose to SEK 2,042 million (1,885) during the second quarter
* Lending rose bySEK 18 billion during the first six months to SEK 386
billion (353)
* Mr Jan Lilja has been appointed to new President
The Spintab Group, "Spintab," comprises the Parent Company, AB Spintab (publ),
and the wholly owned subsidiary ForeningsSparbanken Jordbrukskredit AB. The
Spintab Group is a wholly owned subsidiary of ForeningsSparbanken AB (publ)
(Swedbank).
Spintab provides long-term financing for housing, municipal investments, and
agricultural and forestry properties. The Spintab Group is quality certified
according to ISO 9001 and environmentally certified according to ISO 14001.
Profit
Operating profit before appropriations and taxes amounted to SEK 2,042 million
(1,885). The return on equity was 16.5 percent (16.0). Net interest income was
higher than the corresponding period of 2002, amount ing to SEK 2,425 million
(2,271). The higher net interest income is mainly the result of a higher lending
volume. The net interest income for 2002 includes repayment of a credit
insurance of SEK 66 million.
Commissions payable
Commissions payable have increased by SEK 22 million or 9 percent, mainly owing
to the positive development of the cooperation with the independent savings
banks and partly owned banks.
Operating expenses
Operating expenses has been reduced with SEK 8 million and amounted to SEK 68
million (76).
Loan losses
Loan losses amounted to SEK 80 million (103), equivalent to an annual loss level
of 0.04 percent (0.06). Provisions for anticipated loan losses totaling SEK 403
million (507) as of June 30, 2003. Specifications of loan losses and claims are
shown in Notes 2 and 3.
Lending
Spintab's loan to the public rose by a net of SEK 32,862 million (22,333)
corresponding period of 2002, amounting to SEK 386,072 million (353,210) as of
June 30, 2003.
Loans for private homes rose by SEK 24,130 million and agricultural loans by SEK
3,454 million. Loans for commercial properties rose by SEK 5,278 million.
Spintab's total market share was approximately 30 percent as of June 30, 2003,
according to statistics from The Swedish Central bank.
Funding
47 percent of the total funding has been raced from foreign money and capital
markets.
Shareholders' equity
A conditional shareholders' contribution of SEK 1.4 billion was received from
the Parent Company during the first six months of 2003. The capital base was
also strengthened through two dated subordinated loans of SEK 970 and 1,368
million during the same period.
Capital adequacy
As of June 30, 2003 the capital adequacy ratio was 12.0 percent (12.2), of which
the primary capital ratio was 8.9 percent (9.2).
Interest rate risk
An increase in market interest rates of one percentage point as of June 30, 2003
would have reduced the value of Spintab's interest-bearing assets and
liabilities, including derivatives, by approximately SEK 475 million (264). A
one-percent increase in market interest rates would have increased net profit on
financial operations by SEK 0 million (1).
Taxes
Profit has been charged with estimated tax.
New President
Jan Lilja, the Executive Vice President and Chief Financial Officer has been
appointed new President from September 1, 2003.
Accounting change
The interim report has been prepared in accordance with recommendation RR 20 of
the Swedish Financial Accounting Standards Council and follows the same
accounting principles as the most recent annual report. The recommendations that
took effect on January 1, 2003 have been taken into account but have not had a
significant impact.
Financial reporting
Spintab's interim report for the third quarter of 2003 will be released on
October 24, 2003.
Spintab Group - Key financial highlights 1999 - 2003
2003* 2002* 2002 2001 2000 1999
Lending
Loan volume, SEK m. 386,072 353,210 367,645 340,997 321,332 307,777
Doubtful, restructured and non-performing
loans, net SEK m. 433 619 553 631 886 1,716
Profitability
Operating profit , SEK m. 2,042 1,885 3,839 3,487 3,116 2,901
Interest margin, % 1.04 1.03 1.01 1.02 0.94 0.88
Investment margin, % 1.21 1.27 1.22 1.22 1.17 1.14
Expense ratio, % 0.04 0.04 0.04 0.05 0.07 0.10
Income/expense ratio before loan losses 0.03 0.04 0.04 0.04 0.06 0.09
Income/expense ratio after loan losses 0.07 0.09 0.07 0.09 0.13 0.15
Return in equity, % 16.5 16.0 15.9 14.5 13.1 12.3
Earnings per share, SEK 63.91 59.00 120.18 109.17 97.87 91.04
Capital
Capital base, SEK m. 23,783 21,626 20,048 21,879 21,922 22,704
Equity, SEK m. 19,121 17,602 16,251 16,245 16,224 16,206
Number of shares at beginning/end of period, million 23 23 23 23 23 23
Equity per share, SEK 831.35 765.30 706.59 706.30 705.39 704.61
Capital adequacy ratio, % 12.0 12.2 10.8 13.1 13.2 14.7
Primary capital, % 8.9 9.2 8.8 9.7 9.8 10.5
Credit quality
Loan losses, SEK m. 80 103 129 194 246 218
Loan loss level, % 0.04 0.06 0.04 0.06 0.08 0.07
Provision ratio for doubtful claims, % 85.1 79.2 73.4 77.4 61.5 54.9
Share of doubtful claims, % 0.02 0.04 0.05 0.04 0.10 0.24
* as of June 30
Profit and loss account, the Group
Jan - June Jan - June Change April - June April - June Change
SEK million 2003 2002 % 2003 2002 %
Interest receivable 10,966 10,357 6 5,474 5,308 3
Interest payable -8,541 -8,086 6 -4,279 -4,146 3
NET INTEREST INCOME 2,425 2,271 7 1,195 1,162 3
Commissions receivable 19 21 -10 10 11 -9
Commissions payable -258 -236 9 -127 -116 9
Net profit on financial
operations Note 1 -2 2 - -2 3 -
Other operating income 6 6 0 4 2 100
TOTAL INCOME 2,190 2,064 6 1,080 1,062 2
Staff costs -12 -12 0 -6 -6 0
Other administrative expenses -51 -55 -7 -23 -28 -18
Depreciation of tangible fixed assets -5 -8 -38 -2 -4 -50
Other operating expenses 0 -1 - 0 -1 -
TOTAL EXPENSES BEFORE
LOAN LOSSES -68 -76 -11 -31 -39 -21
Loan losses Note 2 -80 -103 -22 -34 -44 -23
OPERATING PROFIT 2,042 1,885 8 1,015 979 4
Tax on profit for the period -572 -528 8 -284 -274 4
PROFIT FOR THE PERIOD 1,470 1,357 8 731 705 4
Earnings per share, SEK* 63.91 59.00 31.78 30.65
Profit and loss account, AB Spintab
Jan - June Jan - June Change April - June April - June Change
SEK million 2003 2002 % 2003 2002 %
Interest receivable 10,776 10,222 5 5,374 5,242 3
Interest payable -8,549 -8,085 6 -4,283 -4,145 3
NET INTEREST INCOME 2,227 2,137 4 1,091 1,097 -1
Commissions receivable 15 18 -17 8 9 -11
Commissions payable -236 -219 8 -117 -109 7
Net profit on financial
operations Note 1 -2 1 - -2 2 -
Other operating income 5 6 -17 3 3 0
TOTAL INCOME 2,009 1,943 3 983 1,002 -2
Staff costs -11 -11 0 -6 -6 0
Other administrative expenses -50 -53 -6 -22 -27 -19
Depreciation of tangible fixed assets -5 -8 -38 -2 -4 -50
Other operating expenses 0 -1 - 0 -1 -
TOTAL EXPENSES BEFORE
LOAN LOSSES -66 -73 -10 -30 -38 -21
Loan losses Note 2 -81 -103 -21 -35 -44 -20
OPERATING PROFIT 1,862 1,767 5 918 920 0
Tax on profit for the period -521 -495 5 -257 -258 0
PROFIT FOR THE PERIOD 1,341 1,272 5 661 662 0
Earnings per share, SEK* 58.30 55.30 28.74 28.78
*Based on 23 million shares
The Group AB Spintab
June 30 June 30 Dec 31 June 30 June 30 Dec 31
SEK million 2003 2002 2002 2003 2002 2002
Assets
Treasury bills 100 248 100 100 248 100
Loans to credit institutions 44,867 6,455 6,597 66,246 24,781 26,094
Loans to the public 386,072 353,210 367,645 363,038 333,629 346,655
Other assets 7,362 11,416 5,021 8,618 12,339 6,280
TOTAL ASSETS 438,401 371,329 379,363 438,002 370,997 379,129
Group receivables
Parent Company 42,713 3,779 5,512 42,675 3,736 5,421
Subsidiaries - - - 22,862 19,455 21,017
Assets pledged
Assets pledged for own liabilities 2,940 5,062 2,657 2,940 5,062 2,657
Securities pledged as collateral
for forward contracts 100 250 100 100 250 100
Commitments
Loans to the public, amount
granted but not utilized 6,518 8,511 6,135 5,886 8,184 5,738
Liabilities
Amounts owed to credit institutions 8,727 19,037 12,717 8,727 19,037 12,717
Debt securities in issue
Bonds 291,341 226,917 247,351 291,150 226,917 247,351
Commercial papers, other 107,011 94,850 86,226 107,202 94,845 86,226
Other liabilities 5,863 7,370 12,818 5,726 7,261 12,717
Subordinated liabilities 6,338 5,553 4,000 6,338 5,553 4,000
TOTAL LIABILITIES 419,280 353,727 363,112 419,143 353,613 363,011
Untaxed reserves - - - 138 143 138
Shareholders' equity
Subscribed capital 11,500 11,500 11,500 11,500 11,500 11,500
Restricted reserves 3,353 3,357 3,353 3,100 3,100 3,100
Profit brought forward 2,798 1,388 -1,366 2,780 1,369 -1,388
Profit for the period 1,470 1,357 2,764 1,341 1,272 2,768
TOTAL SHAREHOLDERS' EQUITY 19,121 17,602 16,251 18,721 17,241 15,980
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY 438,401 371,329 379,363 438,002 370,997 379,129
Group liabilities
Parent Company 59,700 38,154 35,956 59,700 38,154 35,956
Contingent liabilities
Interest rate and
currancy-related contracts 318,164 301,231 249,096 318,164 301,231 249,096
Conditional shareholder's
contribution 1,400 - - 1,400 - -
Balance sheet
NOTE 1, NET PROFIT ON FINANCIAL OPERATIONS
This item consists mainly of gains and losses in connection with securities
trading within the framework of Spintab's investment guidelines.
NOTE 2, LOAN LOSSES, NET
January - June The Group AB Spintab
SEK million 2003 2002 2003 2002
Claims assessed individually
The period's write-off for established loan losses 143 85 142 85
Reversal of previous provisions for anticipated
loan losses reported in the year's accounts as
established -121 -45 -120 -45
The year's provisions for anticipated loan losses 62 54 62 54
Recoveries from previous years' established loan losses -15 -17 -15 -17
Recovered provisions for anticipated loan losses -43 -22 -42 -22
The year's net expense 26 55 27 55
Collective provisions for individually assessed claims
Allocation to reserve for anticipated losses 50 40 50 40
Collectively valued homogenous groups of claims with limited
value and similar credit risk
The year's write-off for established loan losses 12 17 12 17
Recoveries from previous year's established loan losses -1 -5 -1 -5
Allocations/withdrawals from loan loss reserve -7 -4 -7 -4
The year's net expense for collectively assessed claims 4 8 4 8
The year's net loan loss expense 80 103 81 103
NOTE 3, CLAIMS
(Loans to credit institutions and loans to the public)
The Group AB Spintab
June 30 June 30 Dec 31 June 30 June 30 Dec 31
SEK million 2003 2002 2002 2003 2002 2002
Accrued acquisition value
(before accounting for provisions) 431,342 360,172 374,704 429,685 358,915 373,208
Specific provisions for individually
assessed claims -207 -296 -309 -205 -294 -306
Provisions for collectively valued
homogenous groups of claims with limited
value and similar credit risk -45 -59 -52 -45 -59 -52
Collective provisions for claims
assessed individually -151 -152 -101 -151 -152 -101
TOTAL PROVISIONS -403 -507 -462 -401 -505 -459
BOOK VALUE 430,939 359,665 374,242 429,284 358,410 372,749
Total provision ratio for doubtful
claims, % 85.1 79.2 73.4 85.6 79.7 73.9
Provision ratio for individually
identified doubtful claims, % 53.2 55.5 57.3 53.4 55.7 57.6
Doubtful claims
Book value of doubtful claims (unsettled) 222 285 269 218 281 264
Doubtful claims as % of total lending 0.02 0.04 0.04 0.02 0.04 0.05
Unsettled claims for which interest has
been entered as income
Book value of unsettled claims not
included in doubtful claims and for which
accrued interest has been entered as
income 331 427 356 319 404 334
Restructured and reclassified claims
Book value of claims restructured during
the financial period before
restructuring 99 84 135 99 84 135
Book value of claims restructured during
the financial period after restructuring 38 66 88 38 66 88
Book value of doubtful claims returned
in status to normal claims during the
financial period 63 36 84 63 36 84
Specification: Loan receivables
Other
Sector Private Real estate corporate Municip- Credit
SEK million individuals management lending alities institution Total
Accrued acquisition value before provisions 284,204 84,021 10,262 7,988 44,867 431,342
Specific provisions for claims assessed
individually -26 -168 -13 -207
Collective provisions for claims assessed
individually -151 -151
Provisions for collectively valued
homogenous groups -45 -45
Book value for claims taking provisions
into account 284,133 83,702 10,249 7,988 44,867 430,939
Book value of doubtful claims (unsettled) 17 201 4 222
Book value of non-performing loans where interest is
entered as income 199 132 331
Condensed statement of cash flows
January - June The Group AB Spintab
SEK million 2003 2002 2003 2002
LIQUID ASSETS AT BEGINNING OF PERIOD* 2,887 1,143 19,996 14,231
Operating activities
Operating profit 2,042 1,885 1,862 1,767
Adjustment for non-cash items including taxes paid -3,303 -1,316 -3,847 -743
Increase/decrease in holdings of securities classified,
as current assets -22,049 -2,747 -23,879 -3,918
Increase/decrease in loans to the public -18,507 -12,316 -16,463 -11,099
Increase/decrease in borrowings from the public
including retail bonds 133 -2,337 133 -2,337
Increase/decrease in amounts owed to credit
institutions -4,277 -2,880 -4,277 -2,880
Change in other assets and liabilities, net -2,652 -6,436 -1,890 -6,769
CASH FLOW FROM OPERATING ACTIVITIES -48,613 -26,147 -48,361 -25,979
Investing activities
Change in fixed assets -2 -26 -200 -126
CASH FLOW FROM INVESTING ACTIVITIES -2 -26 -200 -126
Financing activities
Issuance of interest-bearing securities 80,622 55,126 80,582 55,126
Redemption of interest-bearing securities -34,619 -38,710 -34,619 -38,710
Shareholders' contribution 1,400 - 1,400 -
Increase/decrease in other funding 20,976 11,081 21,016 11,081
Group contribution paid -3,830 -3,459 -3,830 -3,459
CASH FLOW FROM FINANCING ACTIVITIES 64,549 24,038 64,549 24,038
Cash flow for the period 15,934 -2,135 15,988 -2,067
LIQUID ASSETS AT END OF PERIOD* 18,821 -992 35,984 12,164
*Of which securities pledged:
at beginning of period 100 50 100 50
at end of period 100 250 100 250
Liquid assets include, where applicable, cash and balances with central banks,
for net claims the net of demand loan receivables and demand loan liabilities
with maturities up to five days, and Treasury bills, and mortgage bonds eligible
for refinancing with Sveriges Riksbank (the central bank), taking into account
repos and short-selling
Changes in shareholders' equity
Subscribed Other Non-restricted
Group, SEK million capital reserves equity Total
OPENING BALANCE JAN. 1, 2002 11,500 3,357 1,388 16,245
Group contribution paid -3,830 -3,830
Tax reduction due to Group
contribution paid 1,072 1,072
Change in tax allocation
reserve -4 4 0
Profit for the period 2,764 2,764
CLOSING BALANCE DEC. 31, 2002 11,500 3,353 1,398 16,251
Conditional shareholders'
contribution 1,400 1,400
Profit for the period 1,470 1,470
CLOSING BALANCE JUNE 30, 2003 11,500 3,353 4,268 19,121
Subscribed Other Non-restricted
AB Spintab, SEK million capital reserves equity Total
OPENING BALANCE JAN. 1, 2002 11,500 3,100 1,370 15,970
Group contribution paid -3,830 -3,830
Tax reduction due to Group
contribution paid 1,072 1,072
Profit for the period 2,768 2,768
CLOSING BALANCE DEC. 31, 2002 11,500 3,100 1,380 15,980
Conditional shareholders'
contribution 1,400 1,400
Profit for the period 1,341 1,341
CLOSING BALANCE JUNE 30, 2003 11,500 3,100 4,121 18,721
SPECIFICATION OF DERIVATIVES IN THE GROUP ON JUNE 30, 2003
Interest rate-related Foreign exchange-related
SEK million Fair value Book value Fair value Book value
Derivatives with positive
values 1,404 205 2,013 167
Derivatives with negative
values 3,096 790 7,897 183
Other derivatives
Credit default swap with fair value SEK 0 million and book value SEK - 1
million.
The above figures include accrued coupon interest. All derivatives are covered
by hedge accounting, since they are held to eliminate interest and currency
risks. The reported differences between book and fair value are matched by
equivalent offsetting differences between the book and fair values in Spintab's
lending and funding.
SPINTAB'S RATINGS
S&P Moody's Fitch
Long-term - Aa3 AA-
Short-term A-1 P-1 F-1+
Stockholm, August 22, 2003
Mikael Inglander
President and CEO
Auditors' review
We have reviewed this interim report in accordance with the recommendation
issued by the Swedish Institute of Authorized Public Accountants. A review is
considerably limited in scope compared with an audit. Nothing has come to our
attention that causes us to believe that the interim report does not comply with
the requirements of the Securities and Clearing Operations Act and the Annual
Accounts Act for Credit Institutions and Securities Companies.
Stockholm, August 22, 2003
Deloitte & Touche AB Ernst & Young AB
Jan Palmqvist Torbjorn Hanson Peter Markborn
Authorized Public Authorized Public Authorized Public
Accountant Accountant Accountant
Appointed by the
Swedish Financial
Supervisory Authority
For further information, please contact:
Mr. Mikael Inglander, President and Chief Executive Officer
Phone +46-8-5859 1314
Mr. Par Sandberg, Head of Accounting
Phone +46-8-5859 1338
This information is provided by RNS
The company news service from the London Stock Exchange
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