Contraction of domestic banks’ net income from financial operations continued in the second quarter

In the second quarter of 2009, domestic banks’ net income from financial operations amounted to EUR 728 million. Their net income from financial operations contracted by 27 per cent from the second quarter of 2008. The fall in the net income from financial operations started in the first quarter of 2009. The contraction is explained by narrowed difference in the interest rate between the loan and deposit stocks.

Commission income began to show growth in the second quarter. A strong increase was also recorded in net gains from securities and foreign currency transactions. Recorded impairment losses on loans and other commitments amounted to EUR 206 million in the first quarter. The item includes realised impairment losses and provisions for future impairment losses. Impairment losses have been growing fast since the early part of 2008.

The net operating profit of domestic banks diminished by 6 per cent year-on-year in the second quarter. Despite the weak development in the net income from financial operations, the decline in the net operating profit slowed down from the previous quarters as other income items grew and growth in administrative expenses came to a halt.

The aggregate value of the balance sheets of domestic banks was EUR 332 billion at the end of June. The balance sheets grew by 13 per cent year-on-year. The share of own equity in the total of the balance sheets was 5.8 per cent.

Year-on-year change in net income from financial operations and net operating profit of domestic banks by quarter, %

Source: Statistics Finland

Inquiries: Marja Keltanen (09) 1734 3328, Saara Roine (09) 1734 3325

Director in charge: Ari Tyrkkö

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Updated 01.10.2009

Referencing instructions:

Official Statistics of Finland (OSF): Financial statement statistics on credit institutions [e-publication].
ISSN=2342-5180. 2nd quarter 2009. Helsinki: Statistics Finland [referred: 22.12.2024].
Access method: http://www.stat.fi/til/llai/2009/02/llai_2009_02_2009-10-01_tie_001_en.html