The Board of Directors of KommuneKredit have today approved the Annual Report for 2017.
› PRELIMINARY ANNOUNCEMENT OF FINANCIAL STATEMENTS, 2 MARCH 2018
▪▪ Profit for the year before value adjustments and tax amounted to DKK 511 million against DKK 550 million in 2016.
▪▪ Comprehensive income for the year was DKK 489 million against DKK 497 million in 2016.
▪▪ Lending increased by 3 pct. to DKK 174 billion.
▪▪ Net interest income decreased to DKK 634 million from DKK 656 million in 2016.
▪▪ Common Equity Tier 1 (CET1) capital, corresponding to equity, increased to DKK 7,333 million from DKK 6,844
million in 2016.
▪▪ The equity ratio rose to 3.3 pct. from 3.1 pct. in 2016.
▪▪ No loss on lending for the 119th consecutive year.
In connection to the announcement of the Annual Report 2017 CEO Jens Lundager says: “KommuneKredit emerged from 2017 with a satisfactory result. KommuneKredit does not pay dividends to our owners, and the association’s earnings only need to cover expenses and ensure an adequate equity ratio. Thus, our profitability translates into low lending rates for our clients.”
“In May 2017, we launched our inaugural green bond issue for EUR 500 million”, Jens Lundager continues. “With this new type of green financing we help increase focus on the environmental and climate improvements that are enabled through investments in local communities across Denmark. The inaugural bond issue covered 128 green projects, including water purification in Svendborg and district heating on the island of Bornholm.”
GUIDANCE FOR 2018
Based on strengthened liquidity in the municipalities an unchanged net new lending of DKK 5 billion, as well as a gross funding requirement of roughly DKK 80 billion, is forecast. Owing to KommuneKredit’s strong market position and relatively constant lending margins, net interest income is expected to be in the amount of DKK 500 million. The continued roll-out of the IT strategy and the refurbishing of KommuneKredit’s offices is expected to result in increased administrative expenses in 2018. As a result, profit before value adjustments and tax is expected to be around DKK 370 million with the equity ratio being maintained at just over 3 pct.
KommuneKredit is an association, whose purpose is to provide lending to municipalities and regions and companies with a 100% municipal guarantee.
The association is the municipalities and regions own credit institution and exist solely for our clients.