The Copenhagen Stock Exchange
The Luxembourg Stock Exchange
The Frankfurt Stock Exchange
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Euronext N.V.
Oslo Børs ASA
The Press
31 January 2008
Stock Exchange Announcement No. 1/2008 - FIH Financial Report 2007
• The net profit after tax for the group amounting to DKK 1,123 million is
a new record
• Satisfactory business segment growth
• Still excellent return on unlisted shares
• Writedowns of loans continually modest
• Very satisfactory liquidity amounting to DKK 33.7 billion
Net profit for the period
Net profit for 2007 DKK 1,123.3 million after tax, an increase of DKK 188
million compared with 2006. The result is in line with the expectations for
2007 as announced earlier this year.
Return on equity before tax came to 17.6 per cent against 18.9 per cent in 2006
and 15.6 per cent after tax against 15.0 per cent in 2006.
Activities
In 2007 synergies have been apparent between FIH's lending units and the new
business segments established during 2006 and the first six months of 2007.
Thus the recent investments made by the bank have had the intended effect. FIH
is now able to offer a broader selection of products in-house which provides a
solid competitive edge.
In addition, the bank's three primary business areas have seen an increase in
activities.
FIH Capital Markets
In 2007, FIH Capital Markets has further strengthened its profile by the
establishment of a tier 1 equity team, primarily focusing on institutional
customers. Combined with Capital Markets' other activities this new initiative
helps FIH gain a strong profile in the market.
In November 2007, Prospera AB published its annual stockbroker ranking on
dealing, settlement and analysis of shares. FIH obtained a ranking of number
three in the region, while it is rare that a newly established stockbroker unit
enters the top five list.
Investment Banking
In 2007, FIH PARTNERS A/S announced more than 20 transactions at an amount of
more than DKK 140bn. FIH PARTNERS A/S thus makes the top of the list of Danish
Investment Banking players measured by the number of transactions and the
transaction values.
Lending activities
The result generated by the lending units surpasses the expectations, and the
total loan portfolio has increased by more than 11 per cent since the beginning
of the year. In 2006, FIH went through an adjustment of the lending
organisation with the purpose of ensuring an increased focus on the customer
portfolio.
Private equity
FIH holds a portfolio of investments in unlisted shares. In 2007, these
investments have developed favourably and the unlisted shares have provided an
excellent return of DKK 632.2 million.Of this DKK 331.2 million is a realised
gain while DKK 301.0 million is unrealised. FIH only holds a very limited stock
of listed shares.
Funding
In 2007, FIH has made efforts to diverse the funding base, and therefore
additional funding sources have been established, including FIH Kapital Bank
A/S. By
establishing FIH Kapital Bank A/S, FIH has obtained a committed loan facility
from ATP of DKK 15 billion. Furthermore, FIH has received substantial deposits
primarily from financial institutions and secondly from corporate customers. In
the beginning of the second quarter of 2008 deposit taking from retail
costumers will be initiated.
There are no sub-prime exposures incorporated in the FIH balance sheet.
However, as the crises have had a broad effect on the international loan
markets, FIH has been hit by increasing funding costs along with the entire
financial sector. The narrowing of the interest rate margin and capital losses
in connection with the international crisis has entailed costs of app. DKK 200
million. The liquidity is very satisfactory at the end of 2007 and amount to
DKK 33.7 billion.
See attached files for the remaining Financial Report 2007
