Stock Exhange Release 3 November 2020
Finnvera revises its profit outlook for 2020 due to the continuing uncertainty of the corona pandemic
Revised outlook for 2020
The coronavirus pandemic causes still exceptional uncertainty in the outlook. The Finnvera Group's profit outlook for 2020 is in line with that given in the January‒June Half-Year Report i. e. owing to credit loss provisions, the Group’s result for 2020 will show a loss due to the calculated impact of macroeconomic indicators and the decline of risk ratings of individual risk subjects.
Credit loss provisions associated with Finnvera’s export credit guarantee and special guarantee operations grew by approximately EUR 500 million in January‒June. The risk ratings of individual risk subjects have further declined after this. As a result, the estimated increase of credit loss provisions since end of June is approximately EUR 600 million. The calculation of credit loss provisions is carried out in accordance with IFRS 9. The amount of realised credit losses is still moderate and possible realised losses will be seen later.
An unprofitable separate result from export credit guarantee and special guarantee operations is covered primarily from the reserve for export credit guarantee and special guarantee operations in Finnvera’s balance sheet. Should the reserve in the balance sheet lack sufficient assets to cover the loss, the loss is according to the law covered from assets in the State Guarantee Fund. According to the State Guarantee Fund Act, the state is responsible for Finnvera's export credit guarantees and special guarantees.
After the unporfitable result of January‒June Finnvera’s non-restricted equity and the State Guarantee Fund covering an unprofitable result from export credit guarantee and special guarantee operations totalled EUR 1.0 billion at the end of June 2020.
The outlook for 2020, previously announced on August 21, 2020
On 1 July 2020, Finnvera gave a profit warning, reducing its outlook for 2020 and estimated the following in its Half-Year Report H1 / 2020 released on 21 August 2020:
The coronavirus pandemic still causes exceptional uncertainty in the outlook. On the basis of current financial forecasts, we estimate that, owing to credit loss provisions, Finnvera Group’s result for 2020 will show a loss due to the calculated impact of macroeconomic indicators and the decline of risk ratings of individual risk subjects.
Publication of the report of the Board of Directors and the financial statements
Finnvera Group releases interim reports semi-annually. Finnvera Group’s report of the Board of Directors and the financial statements 1 January‒31 December 2020 will be released on 23 February 2021.
Further information:
Pauli Heikkilä, CEO, tel. +358 29 460 2400
Ulla Hagman, CFO, tel. +358 29 460 2458
Distribution:
NASDAQ Helsinki Ltd, London Stock Exchange, The principal media, www.finnvera.fi/eng