Untitled

Transcription

Untitled

1
2
NLB, Ljubljana
Number of branches
121
Number of employees
3,242
Market share (in %) – 31.5.2014
Number of clients
23.5
854,678
Total assets (in EUR million)
NLB Vita, Ljubljana
9,245
Number of employees
NLB Skladi, Ljubljana
Number of employees
Asset under management
(in EUR million)
40
39
11.9
Value of investments of long-term
business funds excluding own
funds (in EUR million)
309
20.15 (mutual funds),
34.7 (portfolio
management)
498
(402 – mutual funds, 96
– portfolio managemnet).
NLB Razvojna banka, Banja Luka
NLB Banka, Tuzla
Numner of branches
66
38
Number of employees
487
445
Number of clients
18.1*
5.5**
322,339
310,049
595
425
* Market share in Republika Srpska.
** Market share in Federation of BiH.
NLB banka, Belgrad
Numner of branches
45
Number of employees
566
1.3
NLB Prishtina, Pristina
Number of clients
Numner of branches
48
Number of employees
526
179,902
Number of clients
16.2
NLB Tutunska banka, Skopje
246,834
Numner of branches
454
NLB Nov penziski fond, Skopje
Number of employees
30
Market share of compulsory pension
insurance (in %) – 30.6.2014
46.4
Market shate of voluntary pension
insurance (in %) – 30.6.2014
48.98
Net value of pension funds
(in EUR million)
308
49
Number of employees
787
16.4
Number of clients
226
577,275
969
NLB Montenegrobanka, Podgorica
Numner of branches
17
Number of employees
317
17.0
Number of clients
76,159
507
3
Table of
of contents
contents
Table
Business report
5
Key events
7
Key financial data
9
Comments on the income statement
11
Comments on the financial position statement
14
Core and non-core business of NLB Group
16
Risk management
17
Funding
20
Corporate governance of NLB d.d.
21
Other key activities
22
Financial statements
23
4
1
Business
report
5
Statement of management's responsibility
The Management Board confirms the statements in the Business report, which are in accordance with
enclosed financial statements for the six months ended June 30, 2014 and represent the true and fair
picture of the financial position of the bank and the group and the results of their operations for the six
months ended June 30, 2014.
The Management Board confirms that the Business report includes a fair review of the development
and performance of the bank and the group and their financial situation, including a description of the
main risks to which the bank and subsidaries included in the consolidation are exposed.
6
Key events
Important events in the Bank's business
environment
Standard & Poor's affirmed
Slovenia’s sovereign credit rating
at A- with stable outlook
(17.1.2014).
IMF issues the final report of the
October mission to Slovenia with
the projection of negative growth
of GDP for 2014 (-1.1%) and a
note that the economy is still in
recession, and that a
comprehensive bank and
corporate restructuring is
essential to achieve financial
stability, fiscal and debt
sustainability, and durable growth
(17.1.2014).
Moody’s affirmed Slovenia’s
sovereign credit rating at Ba1 and
changed the outlook from
negative to stable (24.1.2014).
January 2014
Resolution finding that the need
for a large number of employees
is permanently terminated for
business reasons covering 141
employees with different jobs in
order to reorganise and optimise
the Retail Network (21.1.2014).
NLB d.d. Representative Office
Moscow was closed (31.1.2014).
The European Commission
publishes the results of in-depth
reviews of the economic situation
in 17 member states. For
Slovenia the Commission again
found excessive macroeconomic
imbalances that require
monitoring and further decisive
policy measures (5.3.2014).
Slovenia issues 5- and 10-year
maturity bonds denominated in
USD in total amount of 3.5 billion
USD (10.2.2014).
European Commission issues
forecast of economic trends in
Slovenia for 2014 and 2015 with
negative growth of real GDP (0.1 %) for 2014 and a positive
growth of real GDP in 2015
(+1.3%) (25.2.2014).
EBRD adopts new strategy for
Slovenia. The document identifies
the corporate sector, the financial
sector and energy efficiency as
the three priority areas for the
Bank’s work in Slovenia in the
period 2014-2017 (26.2.2014).
February
Supervisory Board approves the
new Strategy of NLB Group 20142018 and the Bank's new vision,
mission and key values.
(28.2.2014).
NLB d.d. in Slovenia announces
optimisation of the Retail and
ATM Network and closing of
some of the branches in the 2Q
2014.
Asset management activities
were transferred to the subsidiary
NLB Skladi (28.2.2014) in order
to have this important activity
centralised and by consequence
to focus on high-quality customer
service provided by the NLB
Group.
NLB d.d. successfully issues 12
month commercial papers on
behalf of GEN - I d.d., Ljubljana in
the amount of EUR 35 million
(24.3.2014).
Institute of Macroeconomic
Analysis and Development
(IMAD) issues its spring
economic forecast. With less
uncertainty in the environment the
real GDP is expected to increase
by 0.5% in 2014 and by 0.7% in
2015 (14.3.2014).
The Government adopts the
changes and amendments to
BAMC Statute. (14.3.2014).
Based on the opinions and
information given by the Bank of
Slovenia the Government made
decisions regarding further
execution of the measures
strengthening the stability of the
banks (19.3.2014).
March
The Management Board adopts a
Resolution finding that the need
for a large number of employees
is permanently terminated for
business reasons covering 88
employees with different jobs
(start of Phase Three of
Redundancy Programme)
(18.3.2014).
NLB d.d. successfully issues first
edition of 9 month commercial
papers on behalf of Telekom
Slovenia d.d., Ljubljana in the
amount of EUR 50 million
(10.3.2014) and fifth edition of 6
month commercial papers on
behalf of Petrol d.d., Ljubljana in
the amount of EUR 50 million
(24.3.2014).
The Republic of Slovenia issues
3.5 year and 7-year bonds
denominated in EUR in total
amount of EUR 2 billion
(1.4.2014).
Bank of Slovenia issues its new
macroeconomic forecasts, where
it expects the real GDP to
increase by 0.6% this year and by
1.4% next year (8.4.2014).
IMF issues its new World
Economic Outlook, where it sees
Slovenian GDP growth at 0.3%
this year and 0.9% in 2015
(8.4.2014).
The Government of the Republic
of Slovenia adopts the National
Reform Programme 2014 – 2015
(15.4.2014).
The application of the Law on
Amendments and Supplements
and the Law on Access to Public
Information (17.4.2014).
ECB launches EBA stress test
excercise, including NLB as one
of the participating banks.
April
Argo d.o.o. (75% share is owned
by NLB) and Huliot, proizvodnja
cevi in opreme d.o.o. sign a
contract on the transfer of the
company, and thus transfer the
business activities of the Argo on
the Huliot, and a contract on
renting the commercial premises
of Argo d.o.o. located in Horjul,
along with a purchase option
(15.5.2014).
The publication of the new NLB
d.d. Code of Corporate
Compliance (5.4.2014).
Start of the sales procedure for
Trimo d.d. and its group, the
shares of which banks (including
NLB d.d.) obtained in the
beginning of this year by
converting one part of their debt
into equity (8.4.2014).
NLB Supervisory Board accepts
the resignation of Dr. France
Arhar (17.4.2014).
Key events in NLB d.d.
7
Key events
Important events in the Bank's business
environment
Fitch affirmed Slovenia’s sovereign
credit rating at BBB+, but changed the
outlook from negative to stable
(2.5.2014).
11th Government of the Republic of
Slovenia led by Alenka Bratušek
resigns (5.5.2014).
Elections of the Republic of Slovenia
members to the European Parliament
(25.5.2014).
May
Handover of the documentation and
business custody of the assets,
transferred to BAMC in December
2013 completed.
Gorazd Podbevšek nominated as the
Chairman of the Supervisory Board of
NLB d.d. (16.5.2014).
NLB d.d. becomes the agent in
Pivovarna Laško restructuring
(20.5.2014).
Appointment of KPMG as a
Monitoring Trustee(26.5.2014).
The European Commission issues 8 recommendations for
Slovenia with regard to excessive macroeconomic imbalances.
(2.6.2014)
The Law FATCA (Foreign
Account Tax The Compliance
Act) enters into force. The United
States adopted it on 18 March
2010 (1.7.2014).
Consortium of Sellers closes an agreement to sell 53-percent stake
of Mercator at EUR 86 per share to Agrokor (26.6.2014).
Public Information Access Act,
amendment D, was published in
the Official Journal, obligating
banks, recipients of state aid, to
disclose non-performing loans,
which haven’t been transferred to
the BAMC, within three months
from publication of the act
(4.7.2014).
Standard & Poor's affirmed Slovenia’s sovereign credit rating at A-,
but changed the outlook from stable to unstable (27.6.2014).
Slovenian parliamentary election
(13.7.2014).
The ECB reduces the key interest rate by 10 bp to 0.15% and
implements some new unconventional measures (11.6.2014).
New Supervisory board of Bank Association of Slovenia was
elected with Janko Medja as deputy chairman(11.6.2014).
June
July
Termination of equity participation of the NLB d.d. in Adria Bank,
because of the simplified capital reduction with a simultaneous
capital increase of Adria bank AG, Vienna, noted in the register of
companies. NLB didn’t participate in the capital increase. The only
participating bank was NKBM which acquired a 100 percent share
(05/06/2014).
23. session of the NLB Assembly
of Shareholders (1.7.2014), in
which the rights of the Republic of
Slovenia as the sole shareholder
of the bank were represented by
the Slovenian Sovereign Holding.
Standard & Poor's Rating Agency gives NLB d.d. "BB-" long-term
credit rating and "B" short-term credit rating with a negative outlook
(10.6.2014).
NLB d.d. successfully completes
a three-year unsecured bond
issue with a coupon of 2.875%
p.a. (3.7.2014).
NLB and Steklarna Hrastnik sign the financing contract. The
purpose of the loan is to modernize the production of container
glass (19.6.2014).
A consortium of sellers, including the NLB, sign a contract for the
purchase of the 53,99 percent share of the Letrika d.d. with the
company Mahle Holding GmbH (20.6.2014). Execution of the
contract is tied to the fulfillment of the conditions.
NLB d.d. signs a long-term
syndicated loan in the amount of
EUR 55 million with Gorenje d.d.
NLB d.d acts as an organizer and
agent (9.7.2014).
The Management Board adopts a Resolution finding that the need
for a small number of employees is permanently terminated for
business reasons (24.6.2014).
Mercator’s debt reprogramming agreed (25.6.2014).
11-percent Mercator stake sold (26.6.2014).
Key events in NLB d.d.
8
Key financial data
Table 1:
Key financial data for NLB Group
NLB Group
2013
1.1.-30.6.2013
1.1.-30.6.2014
Change ****
Key indicators
Return on equity after tax (ROE a.t.)*
-135,5%
-16,8%
5,3%
Return on assets after tax (ROA a.t.)*
-10,5%
-1,3%
0,6%
+22,1 p.p.
+1,9 p.p.
Cost/income ratio (CIR) **
95,6%
81,2%
59,9%
-21,3 p.p.
Capital adequacy ratio (CAR) ***
15,2%
10,1%
15,7%
+5,6 p.p.
Tier 1 ratio ***
14,9%
8,5%
15,7%
+7,2 p.p.
Loan/deposit ratio (LTD) - net
86,2%
100,6%
79,7%
-20,9 p.p.
Profit and loss account indicators (in EUR million)
Net interest income
233,5
133,6
162,3
+21,5%
-172,7
65,8
88,6
+34,6%
332,8
161,9
150,2
-7,2%
1.070,2
145,0
66,0
-54,5%
Result before tax
-1.368,7
-109,9
35,7
-
Result after tax
-1.441,6
-91,2
34,0
-2,1%
Net non-interest income
Costs
Impairments and provisions
Financial position statem ent indicators (in EUR million)
Total assets
12.490,1
13.842,5
12.226,8
Loans to non-banking sector (net)
7.744,2
9.135,3
7.614,2
-1,7%
Deposits from non-bankig sector
8.260,9
9.080,8
8.754,3
+6,0%
Equity
1.247,4
1.019,2
1.318,8
+5,7%
23,6
25,1
24,9
+5,4%
Equity of minority shareholders
Portfolio quality indicators (in EUR million)
NPL
2.837,5
4.008,1
2.818,3
-0,7%
NPL / total loans
25,6%
31,1%
25,8%
+0,2 p.p.
Coverage ratio
69,7%
57,6%
70,7%
+1.0 p.p.
* NLB Group - excluding profit of minority shareholders.
** For 2013 the indicator is calculated w ith net income excluding one-offs.
*** Estimation
**** The change in key indicators and prof it and loss account indicators refers to comparison betw een 1-6 2014 and 1-6 2013.
The change in financial position statement indicators and portfolio quality indicators refers to comparison betw een 30.6.2014
and 31.12.2013.
9
Table 2:
Key financial data for NLB d.d.
NLB d.d.
2013
1.1.-30.6.2013
1.1.-30.6.2014
Change ****
Key indicators
Return on equity after tax (ROE a.t.)*
-153,6%
-16,5%
6,3%
Return on assets after tax (ROA a.t.)*
-14,2%
-1,5%
0,8%
+22,8 p.p.
+2,3 p.p.
Cost/income ratio (CIR) **
81,9%
74,4%
52,2%
-22,2 p.p.
Capital adequacy ratio (CAR) ***
16,6%
11,5%
19,5%
+8,0 p.p.
Tier 1 ratio ***
16,6%
9,8%
19,5%
+9,7 p.p.
Loan/deposit ratio (LTD) - net
95,8%
110,3%
86,1%
-24,2 p.p.
Profit and loss account indicators (in EUR million)
Net interest income
157,4
84,7
114,3
+35.0%
-185,5
53,5
70,9
+32,6%
212,4
102,9
96,7
-5,9%
1.226,3
131,6
53,4
-59,4%
Result before tax
-1.466,8
-96,3
35,1
-
Result after tax
-1.540,3
-85,8
35,8
-
Total assets
9.507,4
11.095,4
9.244,7
-2,8%
Loans to non-banking sector (net)
6.128,9
7.475,5
5.978,1
-2,5%
Deposits from non-bankig sector
5.747,5
6.777,8
6.207,2
+8.0%
Equity
1.093,5
972,4
1.164,5
+6,5%
-
-
-
-
Costs
Financial position statem ent indicators (in EUR million)
Equity of minority shareholders
Portfolio quality indicators (in EUR million)
NPL
1.620,4
2.897,7
1.584,6
-2,2%
NPL / total loans
20,4%
29,3%
20,5%
+0,1 p.p.
Coverage ratio
72,6%
56,2%
74,0%
+1,4 p.p.
* NLB Group - excluding profit of minority shareholders.
** For 2013 the indicator is calculated w ith net income excluding one-offs.
*** Estimation
**** The change in key indicators and prof it and loss account indicators refers to comparison betw een 1-6 2014 and 1-6 2013.
The change in financial position statement indicators and portfolio quality indicators refers to comparison betw een 30.6.2014
and 31.12.2013.
Table 3:
Credit ratings for NLB d.d.
International credit ratings
2013
2Q 2013
2Q 2014
Moody's
Caa2
Caa2
Caa1
BB-
BB-
BB-
-
-
BB-
Fitch
Standard & Poor's
10
Comments on the income statement
In the first six months of 2014 NLB Group achieved EUR 34.0 million net profit after tax, which can be
seen as a sign of largely stabilised operations after the extraordinary measures (transfer to The Bank
1
2
Assets Management Company (BAMC) and recapitalization of the bank under ZBAN and ZUKSB )
taken at the end of 2013. Improved underlying trends in results are also the consequence of
systematic change efforts by NLB d.d. throughout 2013 and continuing in 2014.
Key elements of this performance are:
-
Net Operating Income in the first half of the year 2014 was higher than in the same period last
year (EUR +51.5 million / +26% yoy):
o Net interest income was higher than in the same period last year (EUR +28.7 million /
+21% yoy, EUR +0,9 million / +1% qoq), as a result of:
3
 Lower interest income (EUR -17.3 million / -7% yoy) due to the decrease in credit
portfolio. The loss in interest income from the transferred BAMC portfolio was slightly
overcompensated with income from the BAMC securities (net effect approx. EUR +1.8
million in first half of the year).
3
 Continuing trend of reducing interest expenses (EUR -44,9 million / -36% yoy and
EUR -3,0 million / -8% qoq) was partly a result of using excess liquidity to repay ECB
and other wholesale funding in the amount of EUR 866 million and partly a result of
deposit interest rate decreases.
o Total Net non-interest income was higher than in the respective period of 2013 (EUR +22.8
million / +35% yoy):
 Net fee and commission income was stable (EUR +0.1 million / +0% yoy and EUR
+1.6 million / +5% qoq), largely stemming from stable payment transactions and
account fees.
 Income from financial transactions is mainly driven by the capital market conditions
and can be thus highly volatile. In the first half of the year 2014 this income was
considerably positive (EUR +18.3 million), mainly based on the positive sentiment on
the European “periphery” markets (including Slovenia) and one off effects from the
sale of participations.
Illustration 1:
Profit after tax for NLB Group – YoY reconciliation
(in million EUR)
+3.4
-20.2
-0.2
+79.0
34.0
+11.7
-91.2
+22.8
1-6 2014
Profit of minority
shareholders
Income tax expense
Profit from eq. inv.in
assoc.and joint
ventures (equity m.)
Net impairments
and provisions
Total costs
Net non-interest
income
Net interest
income
1-6 2013
+28.7
1
Banking act
Act Defining the Measures of the Republic of Slovenia to Strengthen Bank Stability
3
Without interest income/expenses from derivatives hedge accounting and derivatives for trading.
2
11
Illustration 2:
Profit after tax for NLB Group – QoQ reconciliation
(in million EUR)
+0.9
-1.7
-4.3
28.6
-18.7
+1.2
+0.1
2Q 2014
5.4
Profit of minority
shareholders
Income tax expense
Profit from eq. inv.in
assoc.and joint
ventures (equity m.)
Net impairments
and provisions
Total costs
Net non-interest
income
Net interest
income
1Q 2014
-0.6
-
Lower total costs (EUR -11.7 million / -7% yoy) based on the extensive rationalisation and
transformation programme throughout 2013, where labour costs decreased by 6%, amortization
costs by 19% and other operating costs by 4%. Consequently, CIR improved and stood at 59.9%
(down by 21.3 p.p. yoy). Costs in the second quarter were, as expected, somewhat higher than in
the first quarter (EUR +4.3 million / +6% qoq) on the account of the costs of portfolio quality
review, stress tests and other planned costs resulting from the restructuring of the bank.
-
The level of established impairments and provisioning is lower than in the same period last
year (EUR -79.0 million / -55% yoy), with significantly higher coverage ratio due to measures
4
taken in December 2013 (NPL coverage 70,7% or 13,1 p.p. higher than in the same period last
year). Reduction of NPLs remains a core focus of attention for NLB Group, where different winddowns as well as other active divestment approaches are used to achieve the set targets.
Groups’ results are driven mainly by the NLB d.d., which in terms of revenues represents approx.
70% of the total group. All of the core banks in the group, apart from NLB banka Belgrade, which is in
the restructuring process, ended the first half of 2014 with a profit. On the other hand, majority of noncore members operated at a loss. According to the bank’s strategy to withdraw from these activities,
they are decreasing the volume of business and mostly do not conclude new transactions, so the
current revenues do not suffice for covering the costs of financing and business costs.
The results of the first half-year, which are above the plans, cannot be considered representative for
the full year results, due to some positive effects, which will not necessarily repeat in the remainder of
the year. Higher costs expected in the second half of the year (mostly costs related to restructuring of
the bank) as well as adjustments of pool impairments and provisions. The outlook for the end of 2014
remains unchanged and solid full year results of the NLB Group are expected.
4
Defined as total stock of provisions against NPL's.
12
Table 4:
NLB Group income statement key items
Cumulative
in EUR million
Net interest income
Net fees and commissions
Dividend income
Net income from financial transactions
Net other income
Total net operating income
Quarters
1.1.-30.6.2013 1.1.-30.6.2014
133.6
162.3
Change YoY
+21%
1Q 2014 2Q 2014
80.7
81.6
Change QoQ
+1%
68.2
68.4
+0%
33.4
35.0
1.6
1.7
+1%
0.0
1.6
+5%
-
-3.5
18.3
-
10.2
8.1
-21%
-0.6
0.3
-
1.5
-1.2
-
65.8
88.6
+35%
45.1
43.5
-4%
199.4
250.9
+26%
125.8
125.1
-1%
Employee costs
-87.3
-81.6
-6%
-41.7
-39.9
-4%
Other general administrative expenses
-52.3
-50.4
-4%
-22.0
-28.4
+29%
Depreciation and amortisation
-22.4
-18.2
-19%
-9.2
-9.0
-2%
-161.9
-150.2
-7%
-73.0
-77.3
+6%
37.5
100.7
+168%
52.9
47.8
-10%
-10.7
-2.1
-80%
-2.0
-0.1
-97%
-133.5
-56.4
-58%
-18.8
-37.6
+100%
Total costs
Result before impairments and provisions
Impairments of financial assets AFS
Credit impairments and provisions
Other impairments and provisions
Result from equity investments in associates and
joint ventures (equity method)
Result before tax
Income tax expense
Result of minority shareholders
Result after tax
-0.8
-7.5
+849%
-2.8
-4.7
+68%
-145.0
-66.0
-55%
-23.6
-42.3
+79%
-2.4
1.0
-
-0.1
1.1
-
-109.9
35.7
-
29.1
6.6
-78%
19.9
-0.3
-
0.2
-0.5
-
1.1
1.3
+18%
0.7
0.6
-16%
-91.2
34.0
-
28.6
5.4
-81%
Table 5:
NLB d.d. income statement key items
Cumulative
in EUR million
Net interest income
Net fees and commissions
Dividend income
Net income from financial transactions
Net other income
Total net operating income
Quarters
1.1.-30.6.2013 1.1.-30.6.2014
84.7
114.3
Change YoY
+35%
1Q 2014 2Q 2014
56.6
57.8
Change QoQ
+2%
50.4
49.9
-1 %
24.6
25.3
+3%
2.8
6.3
+126%
0.4
6.0
+1569%
-26%
5.7
14.6
+158%
8.4
6.2
-5.3
0.0
-
1.9
-1.9
-
53.5
70.9
+33%
35.3
35.6
+1%
+2%
138.2
185.2
+34%
91.9
93.4
Employee costs
-55.7
-51.9
-7 %
-27.1
-24.8
-9%
Other general administrative expenses
-33.8
-32.4
-4 %
-14.2
-18.2
+29%
Depreciation and amortisation
Total costs
Result before impairments and provisions
-13.3
-12.4
-7 %
-6.3
-6.2
-2%
-102.9
-96.7
-6 %
-47.6
-49.2
+3%
35.3
88.5
+151%
44.3
44.2
0%
Impairments of financial assets AFS
-10.7
-2.0
-81 %
-2.0
0.0
-100%
Credit impairments and provisions
Other impairments and provisions
-56.7
-48.7
-14 %
-17.0
-31.7
+87%
-64.2
-2.7
-96 %
-2.4
-0.3
-87%
-131.6
-53.4
-59 %
-21.4
-32.0
+49%
-
-
-
-
-
-
-96.3
35.1
-
22.9
12.2
-47%
10.4
0.7
-93 %
0.6
0.1
-84%
-
-
-
-
-
-
-85.8
35.8
-
23.6
12.3
-48%
Result from equity investments in associates and
joint ventures (equity method)
Result before tax
Income tax expense
Result of minority shareholders
Result after tax
13
Comments on the financial position statement
Total assets of the NLB Group amounted to EUR 12,226.8 million at the end of June 2014, having
decreased by 2% compared to the end of 2013.
Loans to non-banking sector in the NLB Group dropped in the first half of 2014 (EUR -130.0 million /
-2% yoy), mostly as a consequence of continued tough economic situation on the SEE market which
reflects in reduced demand for loans and a more conservative approach of banks to new investments.
Decrease in loan portfolio was further contributed by companies in disinvestment processes (non-core
companies), where intensified recovery and sale of portfolio continues. In this context, a drop in
corporate loans was most significant (EUR -168.1 million / -3% yoy), while retail loans even increased
slightly (EUR +42.2 million / +1% yoy).
The volume of newly-approved loans in NLB d.d. in the first half of the year 2014 for both corporates
(cca. 70%) and households (cca. 30%) is solid at an amount of approx. EUR 700 million. Thereof
approx. 55% relate to new loans, with the remaining part being prolongations of mostly short-term
lines.
On the liabilities side the NLB Group recorded an increase in the non-banking sector deposits (EUR
493.4 million / + 6% yoy). The Group recorded a positive growth in all non-banking segments.
In the first half of the year 2014, NLB Group repaid EUR -866.0 million (-34% yoy decrease) of funds
raised on international financial markets (of which EUR –607.2 million to ECB). After the successful
issue of debt security in July (EUR 300 million), NLB d.d. early repaid another EUR 300 million of
funds raised from ECB.
Consequently, net loan to deposit ratio (LTD) for non-banking sector of the NLB Group improved
compared to the end of 2013 (6.5 p.p. decrease) and stood at 79.7% (BAMC debt securities excluded)
at the end of the second quarter.
Illustration 3:
Total assets – YTD reconciliation (in EUR million)
12,490.1
-130.0
12,226.8
30.6.2014
+34.0
-24.3
Other assets
Property&equipment,
Investment property,
Intangible assets
-258.8
Other liabilities
-10.1
Securities
-58.6
Borrowings from
other fin.inst.
Loans to NBS (net)
+215.2
Loans to banks
Cash
31.12.2013
-255.5
Illustration 4:
Total liabilities – YTD reconciliation (in EUR million)
+2.6
+493.4
12,226.8
30.6.2014
+72.6
Equity of the Group
Deposits form banks
Deposits from NBS
31.12.2013
Borrowings from ECB
-607.2
12,490.1
14
Table 6:
NLB Group and NLB d.d. key indicators of financial position
NLB Group
in EUR million
31.12.2013
30.6.2014
ASSETS
Cash and balances with Central Bank
942,7
Loans and advances to banks
532,5
NLB d.d.
Change
31.12.2013
30.6.2014
Change
687,2
-27%
374,8
192,4
-49 %
747,7
+40%
376,4
502,8
+34%
7.744,2
7.614,2
-2%
6.128,9
5.978,1
-2 %
9.508,5
9.394,0
-1%
7.203,2
7.060,6
-2 %
- corporate
5.515,9
5.351,5
-3%
4.288,2
4.128,8
-4 %
- households
2.875,0
2.917,2
+1%
1.933,0
1.948,3
+1%
- state
495,0
489,9
-1%
359,4
348,2
-3 %
- BAMC securities
622,6
635,3
+2%
622,6
635,3
+2%
Impairments
-1.764,3
-1.779,8
+1%
-1.074,3
-1.082,5
+1%
Financial assets
2.650,3
2.591,7
-2%
2.128,3
2.081,8
-2 %
104,3
127,6
+22%
104,8
128,2
+22%
2.546,0
2.464,1
-3%
2.023,5
1.953,6
-3 %
28,3
33,1
+17%
276,6
283,1
+2%
273,4
270,0
-1%
109,9
102,5
-7 %
54,7
48,1
-12%
45,0
39,1
-13 %
Loans to non-banking sector
Gross loans
- Held for trading
- AFS, held to maturity, designated at fair value
through PL
Investments in subsidiaries, associates and JV
Property and equipment
Intangible assets
Other assets
264,0
234,9
-11%
67,6
64,9
-4 %
Total assets
12.490,1
12.226,8
-2%
9.507,4
9.244,7
-3 %
LIABILITIES
Deposits from non-banking sector
8.260,9
8.754,3
+6%
5.747,5
6.207,2
+8%
- corporate
1.963,6
2.116,4
+8%
1.257,5
1.411,3
+12%
- households
6.064,7
6.228,1
+3%
4.345,3
4.468,2
+3%
232,6
409,8
+76%
144,7
327,6
+126%
Deposits form banks
37,4
40,1
+7%
74,2
76,1
+2%
Debt securities in issue
68,8
68,0
-1%
68,8
68,0
-1 %
2.548,5
1.682,6
-34%
2.298,1
1.466,7
-36 %
281,6
316,3
+12%
225,4
262,2
+16%
21,9
22,0
+0%
0,0
0,0
-
1.247,4
1.318,8
+6%
1.093,5
1.164,5
+6%
1.271,0
1.343,6
+6%
-
-
-
12.490,1
12.226,8
-2%
9.507,4
9.244,7
-3 %
- state
Borrowings
Other liabilities
Subordinated debt
Equity
Shareholders equity (including minority interest)
Total liabilities
15
Core and non-core business of NLB Group
A clear definition of what activities are considered on mid-term as core (where the NLB Group aims to
develop its competitive position) and which as non-core (where gradual withdrawal is planned) allowed
for a focus on the different objectives of the two groups, which already brings positive results.
Profit before tax of EUR 51.1 million was generated by core markets and activities part of NLB
Group. Compared to the same period last year, when the segment recorded a loss in the total amount
of EUR 38.5 million, the performance improved considerably in all areas.
A loss amounting to EUR 7.1 million was incurred in non-core markets and activities part of NLB
Group, which is considerably less than in the same period last year, when it stood at EUR 68.0 million.
Owing to the downsized volume of operations, a decrease was recorded in costs as well as
impairments and provisions.
Illustration 5:
Performance of Core and non-core business – YoY
(in EUR million)
1-6 2013
1-6 2014
60
40
20
0
-20
-40
-60
-80
Core markets and
activities
Non-core markets and
activities
Other
16
Risk management
In the first six months of 2014 the Slovenian economy was positively affected by the economic
recovery in the Eurozone. Nevertheless, the positive trend was still influenced also by structural
imbalances, which need to be resolved in order to improve the quality of the bank’s portfolio in the
long run and ensure further credit growth. The macroeconomic situation was still rather stringent in
most of the countries where members of NLB Group are present, which considerably affected their
operations.
According to NLB Group Strategy the focus is on taking on moderate risks in line with the long-term
sustainable target risk profile, whereby the following basic principles are pursued:
 Independent risk management and autonomous decision-making,
 Meeting the Bank’s business targets must not be connected with assumption of taking
excesive risks,
 Decisions referring to risk management are based on a comprehensive assessment of various
risk factors.
As a systemically important bank NLB Group is subjected to Asset Quality Review – AQR and stress
tests in 2014 carried out by ECB in cooperation with the national supervision institutions prior to
introduction of the Single Supervisory Mechanism – SSM in November 2014.
Credit risk remains the key risk in NLB Group. In accordance with the Measures of the RoS to
Strengthen the Stability of Banks Act, NLB d.d. transferred a considerable share of bad loans to the
Bank Assets Management Company (BAMC) at the end of 2013, which resulted in considerable
improvement of the credit portfolio. Nevertheless, a significant focus of NLB Group remains on further
downsizing of the share of non-performing loans, either with intensive care of distressed customers
mainly along the lines of restructuring, or through debt collection, repossession of the collateral or sale
of receivables. The bank has an early-detection warning system to identify customers whose business
is deteriorating, based on which customers are then submitted to the watch list and under intensive
care. Financial position of such customers and delivery of the action plan designed for them are then
regularly monitored on a specialised committee. Moreover, the process of improving the lending
process and the culture of risk management continues to be implemented, mainly in view of an early,
more systematic and in-depth detection of risks. Apart from the new, stricter credit rating criteria, the
focus is also on development of internal scoring models for individual segments of customers.
After the transfer of non-performing loans to the BAMC and the bank’s recapitalisation, liquidity
situation in the bank as well as in the group has improved considerably and is stable, which is also
reflected in the high level of liquidity reserves and reduced borrowing levels with the Eurosystem. As
at the end of June 2014 the portfolio of liquidity reserve in NLB d.d., which largely consists of ECB
eligible sovereign securities, amounted to EUR 3.4 billion, which accounts for 36.3% of the total
assets. In NLB Group this level amounted to EUR 4.5 billion.
Despite the demanding situation on the international capital markets, in July the bank successfully
issued a three-year unsecured bond. NLB Group also pays special attention to ensuring structural
liquidity, focusing on adequate diversification of funding sources and at the same time providing for a
stable share of retail deposits. Indirectly, the group also balances the structure of the bank’s balance
sheet with its pricing policy. The group prepares several stress scenarios taking into account specific
bank’s crises or system crises in a broader economic environment.
NLB Group maintains a conservative policy for market risks, which reflects in rather closed positions
and relatively low limits. Advanced methods and tools are used to monitor exposure, a proactive risk
management approach has been introduced and relatively detailed control activities are carried out. At
the level of the NLB Group and individual non-banking members, some exposures result from
structural imbalances or credit risk. However, the possibilities for active risk management are limited in
some local markets due to lack of development and poor availability of adequate financial instruments.
Considerable emphasis is also given to operational risk management, which is constantly being
upgraded in terms of monitoring quality. The NLB Group regularly monitors and analyses loss events
and the number of reported loss events and recorded net losses fell slightly in this period of time.
Considerable attention is paid to potential loss event reporting and operational risks are being
identified regularly in all areas. NLB d.d. has zero tolerance for internal and external criminal activities
as well as negligence. Particular attention is also paid to topical risks, such as prevention of loss
events in the lending process, risks associated with divestment of business activities and outsourcing
and the risks associated to HR potential management in the process of headcount reduction.
17
Credit portfolio
The quality of credit portfolio did not change considerably in the first six months of the year, despite
the intra-annual growth and a slightly better economic forecast. The implications of the long-lasting
economic crisis are still reflected in deleveraging of companies in most industries, with a tendency to
achieve a long-term sustainable debt, which consequently also affects the reduction in the credit
portfolio of the Bank or the Group in this segment. Retail consumption has dropped due to stringent
labour market situation, which has reflected mainly in the segment of consumer and card loans,
whereas only home loans have seen a slight increase in the volume.
The volume of risk portfolio fell by 1.5% at the level of NLB Group. The quality of the portfolio slightly
improved and resulted in the increased share of A and B-rated receivables by 0.3 p.p. standing at
70.2%, whereas the share of D and E-rated receivables remained at 22.2%.
As at the end of June 2014 the share of NPLs amounted to 20.5% in NLB d.d., which is almost the
same level as at the end of last year. The volume of bad loans has dropped, yet due to the concurrent
drop in the volume of all loans this had a minimum influence on the overall share of bad loans. The
share of NPLs at the level of NLB Group amounts to 25.8%, which is an increase of 0.2 p.p. Most nonperforming loans come from trade, manufacturing and construction industry, whereas the retail
segment remains among the least risky groups of customers. The coverage ratio (total impairments
against non-performing loans) increased at the end of June 2014, in NLB d.d. it stands at 74.0%,
whereas due to specifics in the operations of some of NLB Group members the group coverage ratio
is slightly lower, 70.7%.
91.4% of the portfolio is accounted for by NLB Group banking members, 3.4% by leasing companies
and 4.5% by factoring companies. The NLB d.d. portfolio in NLB Group accounts for 67.6% and the
receivables to Slovenian customers account for 58.3%.
Table 7:
NPL share in total loans, coverage ratio for NLB Group
NLB Group
2013
31/03/2014
30/06/2014
Change YTD
Change QoQ
NPL/ total loans
25.6%
26.2%
25.8%
0.2 p.p.
-0.4 p.p.
Coverage ratio
69.7%
69.9%
70.7%
1.0 p.p.
0.8 p.p.
2013
31/03/2014
30/06/2014
Change YTD
Change QoQ
NPL/ total loans
20.4%
21.0%
20.5%
0.1 p.p.
-0.5 p.p.
Coverage ratio
72.6%
72.8%
74.0%
1.4 p.p.
1.2 p.p.
Portfolio quality indicators
Table 8:
NPL share in total loans, coverage ratio for NLB d.d.
NLB d.d.
Portfolio quality indicators
18
Illustration 6:
Risk portfolio per customer credit rating for NLB Group as at
30.6.2014
E
15.2%
D
10.4%
A
49.9%
C
8.1%
B
16.5%
Illustration 7:
NPL coverage ratio for NLB Group and NLB d.d.
80%
70%
60%
50%
31.12.2010
31.12.2011
31.12.2012
NLB Group
31.12.2013
30.6.2014
NLB
Outlook
The Slovenian economy has suffered a considerable blow from the global economic crisis, which has
also resulted in deterioration of the banks’ credit portfolio. High indebtedness of the corporate sector
and a relatively low demand for loans in corporate and retail are slowing down the process of credit
portfolio recovery through more intensive debt collection and limit the potential for further healthy
growth in lending. The latter in addition to a favourable macroeconomic situation also requires
measures to resolve structural deficiencies in the Slovenian economy.
NLB Group will continue paying considerable attention to credit risk management also in the future, as
it represents the key risk in the group. Measures aimed at improving the quality of credit portfolio will
focus on restructuring and intensive care of distressed companies, as well as efficient debt collection
of bad and non-core credits, and a precarious lending process and adequate risk management
culture.
19
Funding
NLB d.d. ensures liquidity through the effective management of liquidity reserves, the majority of which
are accounted for by Slovenian government bonds and the investment-grade securities of other
countries. The Bank’s activities to secure long-term sources of funding were particularly focused on
the servicing of existing loan agreements and preparations for the issue of debt securities.
Due to satisfactory liquidity position the Bank prepaid a loan carrying less a favourable interest rate,
and additionally partially early repaid long term funds from ECB (LTRO) in the second quarter of 2014.
As a result of early repayment of funds, loans form financial institutions of NLB d.d. decreased in first
half of 2014 by EUR 831 million, and remain at EUR 1,467 million as of 30.6.2014.
In an effort to harmonise the NLB Group, the bulk of borrowing by Group companies in international
financial markets is coordinated by the NLB d.d., which provides advice to Group companies in their
borrowing activities (nevertheless, the banking members in particular preserve relative independence
in the provision of funding). The focus of the funding of Group companies during the first half of this
year was on borrowing from commercial banks and again form multilateral financial institutions. Group
companies borrowed a total of EUR 10 million from commercial banks and EUR 6 miillion from
multilateral financial institutions during the first half of this year.
In export financing NLB d.d. is predominately focused on its key export markets of its clients. With a
wide correspondent banking network NLB d.d. can provide service also in markets that might offer
new business opportunities. By offering all export related banking services NLB d.d. enables its export
oriented clients smooth business and, if necessary, also collateral and risk sharing services. In case of
larger long-term financing projects, NLB d.d. is liaised with SID Bank that offers commercial and noncommercial risk assurance and risk sharing schemes.
At July 3, 2014 NLB d.d. successfully completed issue of three year unsecured bond with nominal
value EUR 300,000 thousand and annual coupon 2.875% on the international capital markets. The
bond, which was awarded international ratings BB-/BB- by rating agencies Fitch and Standard &
Poors, is listed on Luxemburg Stock Exchange.
20
Corporate governance of NLB d.d.
Management Board
The Management Board of NLB d.d. manages, presents and represents the Bank independently and
on its own responsibility, for which it has all the authorisations in accordance with the law and the
Bank’s Articles of Association. Pursuant to the Articles of Association, the Bank’s Management Board
can comprise of three to six members (the Chairman and up to five members), who are appointed and
discharged by the Supervisory Board. The Chairman and members of the Management Board are
appointed for a period of five years and can get reappointed or discharged early in accordance with
the law and the Bank’s Articles of Association.
The Management Board of NLB d.d. consists of the Chairman of the Management Board Janko Medja
nd
st
(as of 2 of October 2012) and Management Board members Blaž Brodnjak (as of 1 of December
th
st
2012), Nima Motazed (as of 6 of February 2013), Archibald Kremser (as of 31 of July 2013) and
th
Andreas Burkhardt (as of 18 of September 2013).
Supervisory Board
The Supervisory Board of NLB d.d. monitors and supervises the Bank’s management and operations.
It performs its tasks in accordance with provisions of the laws regulating banks and companies and
the Articles of Association of NLB d.d.. In accordance with the Articles of Assotiation the Supervisory
Board consists of seven members who are appointed and discharged by the Bank’s General Meeting
among the candidates proposed by the shareholders or the Supervisory Board.
th
The following Supervisory Board members were appointed at the Annual General Meeting held on 11
of June 2013: dr. France Arhar, Tit A. Erker, Uroš Ivanc, Goran Katušin, Miha Košak, Gorazd
Podbevšek and dr. Sergeja Slapničar. The Supervisory Board was appointed for the period starting
from the day they were appointed until completion of the Annual General Meeting of NLB d.d. deciding
on allocation of the distributable profit for the fourth business year after their appointment, whereby the
first year is the business year in which the members of the NLB d.d. Supervisory Board were
appointed.
th
After the resignation handed in by dr. France Arhar and accepted by the Supervisory Board on 17 of
April 2014, no substitute member of the Supervisory Board was elected at the Annual General
st
Meeting held on 1 of July 2014 to take his position.
Thus the Supervisory Board consists of the following members: Gorazd Podbevšek (Chairman of the
Supervisory Board), Miha Košak (Deputy Chairman of the Supervisory Board), Goran Katušin, Sergeja
Slapničar, Tit A. Erker and Uroš Ivanc.
Annual General Meeting
rd
st
The 23 regular Annual General Meeting of NLB d.d. was held on 1 July 2014, with the Bank’s only
shareholder the Republic of Slovenia represented by the Slovenian Sovereign Holding (SSH) holding
20,000,000.00 or 100 % of the Bank’s voting shares.
At the General Meeting the shareholder acknowledged the 2013 Annual Report, the Supervisory
Board report and the information on receipts of the Management Board and Supervisory Board
members received in 2013, as well as the Rules on Determining Other Rights from Managers’
Employment Contracts or Other Bank’s Documents. The shareholder established that there was no
distributable profit for 2013 and granted a discharge from liability to the Management Board and
Supervisory Board of NLB d.d. for the business year 2013. Additionally, the shareholder adopted
several changes and amendments to the NLB d.d. Articles of Association and appointed Ernst &
Young as the Bank’s auditing company.
NLB d.d. has no holders of securities ensuring special control rights.
NLB d.d. has no restrictions on the voting rights as all NLB d.d. shares ensure voting rights in
accordance with the law (with the exception of potential treasury shares).
21
Other key activities
Apart from its focus on clients and employees, NLB d.d. is making efforts to contribute to better
services:
- Bank continues with the implementation of Trasformational Programme. The aim of the
Transformation Programme is to analyse the existing business model, while also defining and
planning the introduction of appropriately adjusted target business models for each transformed
area. It consists of 23 projects and three business initiatives, out of which 7 projects were finished
in the first half of 2014.
- Continuation of structural and organizational changes in order to have a more direct
communication for faster business decision-making, better risk management and optimization of
resources. In year 2014 changes, covering all areas of the bank, continued with implementation of
the second and the third phase of reorganisation.
- Implementation of the commitments of the Republic of Slovenia to the European Commission is
according to the plan; some commitments have already been fulfilled (mainly in Corporate
th
Governance). On 26 of May 2014 European Commission finally approved the appointment of
rd
KPMG as a Monitoring trustee and terms of its mandate. The contract was signed on 3 of June
2014.
22
2
Financial
statements
23
Unaudited Condensed Interim Financial Statements of NLB d.d. and the
NLB Group
prepared in accordance with IAS 34 “Interim financial reporting”
24
Table of contents
CONDENSED INCOME STATEMENT ...................................................................................................... 26
CONDENSED INCOME STATEMENT – BY QUARTER .......................................................................... 27
CONDENSED STATEMENT OF COMPREHENSIVE INCOME ............................................................... 29
CONDENSED STATEMENT OF COMPREHENSIVE INCOME – BY QUARTER ................................... 30
CONDENSED STATEMENT OF FINANCIAL POSITION ......................................................................... 31
CONDENSED STATEMENT OF CHANGES IN EQUITY ......................................................................... 32
CONDENSED STATEMENT OF CASH FLOWS ...................................................................................... 33
NOTES TO THE CONDENSED FINANCIAL STATEMENTS ................................................................... 35
1.
GENERAL INFORMATION ............................................................................................................. 35
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ............................................................. 35
2.1.
STATEMENT OF COMPLIANCE .................................................................................................................... 35
2.2.
ACCOUNTING POLICIES .............................................................................................................................. 35
3.
CHANGES IN SUBSIDIARY HOLDINGS ....................................................................................... 37
4.
NOTES TO THE CONDENSED INCOME STATEMENT ................................................................ 38
4.1.
INTEREST INCOME AND EXPENSES ..................................................................................................... 38
4.2.
NET FEE AND COMMISSION INCOME ................................................................................................... 39
4.3.
GAINS LESS LOSSES FROM FINANCIAL ASSETS AND LIABILITIES NOT CLASSIFIED AS AT FAIR VALUE
THROUGH PROFIT OR LOSS ............................................................................................................... 39
4.4.
GAINS LESS LOSSES FROM FINANCIAL ASSETS AND LIABILITIES HELD FOR TRADING .............................. 40
4.5.
OTHER OPERATING INCOME .............................................................................................................. 40
4.6.
OTHER OPERATING EXPENSES .......................................................................................................... 40
4.7.
ADMINISTRATIVE EXPENSES .............................................................................................................. 41
4.8.
PROVISIONS FOR OTHER LIABILITIES AND CHARGES ............................................................................ 41
4.9.
IMPAIRMENT CHARGE........................................................................................................................ 41
5.
NOTES TO THE CONDENSED STATEMENT OF FINANCIAL POSITION ................................... 42
5.1.
CASH AND BALANCES WITH CENTRAL BANKS ...................................................................................... 42
5.2.
TRADING ASSETS ............................................................................................................................. 42
5.3.
AVAILABLE FOR SALE FINANCIAL ASSETS ............................................................................................ 42
5.4.
LOANS AND ADVANCES ..................................................................................................................... 43
5.4.1.
5.4.2.
5.4.3.
5.4.4.
5.4.5.
5.5.
5.6.
5.7.
5.7.1.
5.8.
5.8.1.
5.8.2.
5.8.3.
5.8.4.
5.8.5.
Debt securities............................................................................................................................................ 43
Loans and advances to banks .................................................................................................................... 43
Loans and advances to customers ............................................................................................................. 44
Other financial assets ................................................................................................................................. 44
Movements in allowance for impairment of banks, loans and advances to customers and other financial
assets ......................................................................................................................................................... 44
HELD TO MATURITY FINANCIAL ASSETS .............................................................................................. 45
OTHER ASSETS ................................................................................................................................ 45
INCOME TAX ..................................................................................................................................... 46
Deferred tax ............................................................................................................................................... 46
FINANCIAL LIABILITIES MEASURED AT AMORTIZED COST ...................................................................... 47
Deposits from banks and amounts due to customers................................................................................. 47
Borrowings from banks and other customers ............................................................................................. 47
Debt securities in issue .............................................................................................................................. 48
Subordinated liabilities ............................................................................................................................... 48
Other financial liabilities .............................................................................................................................. 48
5.9.
PROVISIONS..................................................................................................................................... 49
5.10. INCOME TAX RELATING TO COMPONENTS OF OTHER COMPREHENSIVE INCOME ..................................... 49
5.11. OTHER LIABILITIES ............................................................................................................................ 50
5.12. BOOK VALUE PER SHARE .................................................................................................................. 50
5.13. CAPITAL ADEQUACY RATIO ................................................................................................................ 50
5.14. OFF-BALANCE SHEET LIABILITIES ....................................................................................................... 51
5.15. FAIR VALUE HIERARCHY OF FINANCIAL AND NON-FINANCIAL ASSETS AND LIABILITIES ............................. 51
5.16. OFFSETTING FINANCIAL ASSETS AND FINANCIAL LIABILITIES ................................................................ 59
6.
EVENTS AFTER THE END OF THE REPORTING PERIOD.......................................................... 61
7.
OTHER DISCLOSURES .................................................................................................................. 62
7.1.
RELATED-PARTY TRANSACTIONS ....................................................................................................... 62
7.2.
ANALYSIS BY SEGMENT ..................................................................................................................... 66
7.3.
SUBSIDIARIES .................................................................................................................................. 68
25
Condensed Income statement
in thousand EUR
NLB d.d.
Notes
Interest and similar income
Interest and similar expenses
4.1.
4.1.
Net interest income
Dividend income
Fee and commission income
Fee and commission expenses
4.2.
4.2.
Net fee and commission income
Gains less losses from financial assets and liabilities not classified as at fair value
through profit or loss
Gains less losses from financial assets and liabilities held for trading
Gains less losses from financial assets and liabilities designated at fair value
through profit or loss
Fair value adjustments in hedge accounting
Foreign exchange translation gains less losses
Gains less losses on derecognition of assets other than held for sale
Other operating income
Other operating expenses
Administrative expenses
Depreciation and amortization
Provisions for other liabilities and charges
Impairment charge
Share of profits/(losses) of associates and joint ventures accounted for using the
equity method
Net loss from non-current assets held for sale
PROFIT/(LOSS) FOR THE PERIOD
Attributable to:
Owners of the parent
Non-controlling interests
six months ended
June
June
2014
2013
six months ended
June
June
2014
2013
%
change
170,564
186,141
(56,237) (101,462)
________ ________
114,327
84,679
======== ========
6,333
2,800
(8)
(45)
64,306
64,395
(14,375)
(14,024)
_________ _________
49,931
50,371
======== ========
(0)
3
35
-
(1)
%
change
252,209
273,162
(89,926) (139,550)
________ ________
162,283
133,612
======== ========
1,660
1,639
(8)
(36)
93,820
92,272
(25,464)
(24,047)
_________ _________
68,356
68,225
======== ========
2
6
21
1
0
4.3.
20,749
5,848
-
20,816
(4,759)
-
4.4.
(5,045)
2,739
-
(2,147)
5,086
-
-
-
-
29
18
61
(980)
(109)
(84)
10,382
(8,767)
(84,321)
(12,424)
(22,361)
(31,038)
(14)
(2,910)
(46)
7,556
(8,079)
(89,542)
(13,310)
(552)
(131,037)
(96)
83
37
9
(6)
(7)
(76)
(980)
581
(1,329)
13,626
(10,574)
(131,986)
(18,248)
(20,716)
(45,256)
(14)
(3,803)
189
14,159
(10,134)
(139,502)
(22,435)
1,102
(146,119)
(4)
4
(5)
(19)
(69)
-
-
-
1,016
(2,386)
-
(1,491)
(4,775)
_________ _________
35,102
(96,272)
======== ========
735
10,446
(69)
(1,426)
(4,775)
_________ _________
35,705 (109,897)
======== ========
(344)
19,859
(70)
4.5.
4.6.
4.7.
4.8.
4.9.
PROFIT/(LOSS) BEFORE INCOME TAX
Income tax
NLB Group
5.7.
_________ _________
35,837
(85,826)
======== ========
35,837
-
(85,826)
-
(93)
-
-
_________ _________
35,361
(90,038)
======== ========
34,014
1,347
(91,176)
1,138
-
18
26
Condensed Income statement – by quarter
in thousand EUR
NLB d.d.
three months ended
June 2014 March 2014 % change
Net interest income
Dividend income
Gains less losses from financial assets and liabilities not
classified as at fair value through profit or loss
Gains less losses from financial assets and liabilities held for
trading
Gains less losses on derecognition of assets other than held
for sale
Provisions for liabilities and charges
Impairment charge
Net (loss)/gain from non-current assets held for sale
Income tax
three months ended
84,391
(26,622)
________
57,769
86,173
(29,615)
________
56,558
(2)
(10)
2
89,403
(49,299)
________
40,104
96,738
(52,163)
________
44,575
========
5,975
========
358
33,238
(7,925)
_________
25,313
========
31,068
(6,450)
_________
24,618
========
7
23
(10)
-
========
2,653
========
147
-
33,204
(7,721)
_________
25,483
========
31,191
(6,303)
_________
24,888
========
6
22
9,975
10,774
(7)
422
5,426
(92)
(2,771)
(2,274)
22
(1,144)
3,883
-
(1,029)
29
49
(138)
-
17
889
(31)
(3,799)
-
(95)
11
-
(46)
-
4,040
(4,315)
(43,028)
(6,155)
(12,780)
(19,213)
(1,536)
_________
12,179
========
102
________
12,281
========
6,342
(4,452)
(41,293)
(6,269)
(9,581)
(11,825)
45
_________
22,923
========
633
________
23,556
========
(36)
(3)
4
(2)
33
62
-
4,258
(3,266)
(44,095)
(6,542)
299
(109,583)
(3,702)
_________
(94,253)
========
12,942
________
(81,311)
========
3,298
(4,813)
(45,447)
(6,768)
(851)
(21,454)
(1,073)
_________
(2,019)
========
(2,496)
________
(4,515)
========
3
(47)
(84)
(48)
(8)
(5)
2
29
(32)
(3)
(3)
-
27
in thousand EUR
NLB Group
Net interest income
Dividend income
Gains less losses from financial assets and liabilities not
classified as at fair value through profit or loss
Gains less losses from financial assets and liabilities held for
trading
Gains less losses from financial assets and liabilities
designated at fair value through profit or loss
Gains less losses on derecognition of assets other than held
for sale
Provisions for liabilities and charges
Impairment charge
Share of profits/(losses) of associates and joint ventures
accounted for using the equity method
Net (loss)/gain from non-current assets held for sale
Income tax
Attributable to:
three months ended
three months ended
124,767
(43,187)
________
81,580
========
1,642
127,442
(46,739)
________
80,703
========
18
(2)
(8)
130,523
(67,997)
________
62,526
========
1,453
142,639
(71,553)
________
71,086
========
186
48,548
(13,586)
_________
34,962
========
45,272
(11,878)
_________
33,394
========
7
14
47,151
(12,861)
_________
34,290
========
45,121
(11,186)
_________
33,935
========
4
15
10,002
10,814
(8)
(10,191)
5,432
-
(1,236)
(911)
36
127
4,959
(97)
12
17
(29)
(32)
50
-
(1,029)
343
49
238
44
17
1,116
(31)
(4,919)
-
1
-
5
(8)
(5)
(12)
-
1
(960)
(369)
-
97
92
5
6,752
(5,537)
(68,232)
(9,034)
(14,209)
(28,117)
6,874
(5,037)
(63,754)
(9,214)
(6,507)
(17,139)
(2)
10
7
(2)
64
7,199
(4,103)
(69,785)
(10,882)
582
(107,945)
6,960
(6,031)
(69,717)
(11,553)
520
(38,174)
3
(32)
0
(6)
12
-
1,093
(77)
-
(2,542)
156
-
(1,475)
_________
6,557
49
_________
29,148
-
(3,702)
_________
(101,775)
(1,073)
_________
(8,122)
-
(78)
========= =========
(495)
151
________
________
6,062
29,299
======== ========
5,447
615
28,567
732
(79)
(81)
(16)
========= =========
11,922
7,937
________
________
(89,853)
(185)
======== ========
(90,483)
630
(693)
508
50
-
24
28
Condensed Statement of comprehensive income
in thousand EUR
Note
NLB d.d.
NLB Group
six months ended
June
June
six months ended
June
June
2014
2014
2013
2013
Net profit/(loss) for the period after tax
35,837
(85,826)
35,361
(90,038)
Other comprehensive income/(loss) after tax
35,158
(10,496)
37,553
(12,239)
-
-
(982)
(982)
274
274
Cash flow hedges (effective portion)
Valuation (losses)/gains taken to equity
Transferred to income statement
(410)
(774)
364
775
323
452
(410)
(774)
364
775
323
452
Available for sale financial assets
Valuation gains/(losses) taken to equity
Transferred to income statement
42,767
61,486
(18,719)
(12,413)
(17,688)
5,275
42,294
60,963
(18,669)
(13,013)
(18,299)
5,286
-
-
4,530
(1,745)
(7,199)
1,142
(7,879)
1,470
70,995
70,995
-
(96,322)
(96,322)
-
72,914
71,485
1,429
(102,277)
(103,049)
772
Items that may be reclassified subsequently to income statement
Foreign currency translation
Translation (losses)/gains taken to equity
Share of other comprehensive income of entities accounted for
using the equity method
Income tax relating to components of other comprehensive (loss)/
income
Total comprehensive income/(loss) for the period after tax
Attributable to owners of the parent
Attributable to non-controlling interests
5.10.
NLB Group has no items in other comprehensive income that would not be reclassified subsequently to income
statement.
29
Condensed Statement of comprehensive income –
by quarter
in thousand EUR
NLB d.d.
three months ended
three months ended
June 2014 March 2014
12,281
23,556
(81,311)
(4,515)
9,699
25,459
6,374
(16,870)
Transferred to profit
(207)
(378)
171
(203)
(396)
193
530
309
221
245
14
231
11,891
21,866
(9,975)
30,876
39,620
(8,744)
7,526
(2,606)
10,132
(19,939)
(15,082)
(4,857)
Income tax relating to components of other comprehensive
(loss)/income
(1,985)
(5,214)
(1,682)
2,824
21,980
49,015
(74,937)
(21,385)
NLB Group
three months ended
three months ended
6,062
29,299
(89,853)
(185)
11,257
26,296
1,549
(13,788)
153
153
(1,135)
(1,135)
(1,945)
(1,945)
2,219
2,219
(207)
(378)
171
(203)
(396)
193
530
309
221
245
14
231
11,153
21,078
(9,925)
31,141
39,885
(8,744)
5,917
(4,237)
10,154
(18,930)
(14,062)
(4,868)
2,462
2,068
(1,611)
(134)
(2,304)
(5,575)
(1,342)
2,812
17,319
16,663
656
55,595
54,822
773
(88,304)
(88,728)
424
(13,973)
(14,321)
348
Foreign currency translation
Translation gains/(losses) taken to equity
Share of other comprehensive income of entities accounted for
using the equity method
Income tax relating to components of other comprehensive
loss/(income)
Attributable to owners of the parent
Attributable to non-controlling interests
30
Condensed Statement of financial position
in thousand EUR
Notes
Cash and balances with central banks
Trading assets
Financial assets designated at fair value through profit or loss
Derivatives - hedge accounting
Loans and advances
- debt securities
- loans and advances to banks
- loans and advances to customers
- other financial assets
Held to maturity investments
Fair value changes of the hedged items in portfolio hedge of interest rate risk
Non-current assets and disposal group classified as held for sale
Property and equipment
Investment property
Intangible assets
Investments in subsidiaries
Investments in associates and joint ventures
Current income tax assets
Deferred income tax assets
Other assets
TOTAL ASSETS
Deposits and borrowings from central banks
Trading liabilities
Financial liabilities designated at fair value through profit or loss
Financial liabilities measured at amortized cost
- deposits from banks
- borrowings from banks
- due to customers
- borrowings from other customers
- debt securities in issue
- subordinated liabilities
- other financial liabilities
Fair value changes of the hedged items in portfolio hedge of interest rate risk
Provisions
Current income tax liabilities
Deferred income tax liabilities
Other liabilities
TOTAL LIABILITIES
EQUITY AND RESERVES ATTRIBUTABLE TO OWNERS OF THE PARENT
Share capital
Share premium
Revaluation reserve
Profit reserves
Retained earnings
TOTAL EQUITY
TOTAL LIABILITIES AND EQUITY
5.1.
5.2.
30.6.2014
% change
374,775
104,779
3,801
1,155,412
5,426
(49)
22
12
(3)
(9)
717,822
702,791
502,833
376,439
5,260,276
5,426,129
42,837
41,337
832,992
864,259
768
530
2,839
2,327
101,042
108,449
1,458
1,458
39,061
44,976
276,392
269,392
6,679
7,200
204
8
5.7.1.
6,928
13,392
5.6.
6,413
4,541
__________ __________
9,244,667
9,507,421
========== ==========
2
34
(3)
4
(4)
45
22
(7)
(13)
3
(7)
(48)
41
5.3.
192,425
128,172
4,268
1,116,319
4,939
NLB d.d.
31.12.2013
5.4.1.
5.4.2.
5.4.3.
5.4.4.
5.5.
659,469
38,972
4,267
36,797
% change
(27)
22
(13)
(3)
(9)
717,822
702,791
747,687
532,533
6,896,394
7,041,430
56,691
63,919
832,992
864,259
768
530
7,350
17,582
229,127
238,578
40,879
34,844
48,084
54,727
33,092
28,284
2,098
1,923
5,668
12,092
157,354
162,492
__________ __________
(3)
12,226,800
12,490,134
========== ==========
2
40
(2)
(11)
(4)
45
(58)
(4)
17
(12)
(48)
14
12
1
76,054
74,234
772,773
995,133
6,202,883
5,743,673
34,474
36,284
68,046
68,782
76,136
61,609
133
5.9.
105,309
87,080
5.7.1.
5.11.
5,024
6,004
__________ __________
8,080,204
8,413,953
========== ==========
2
(22)
8
(5)
(1)
24
(100)
21
(16)
200,000
200,000
871,378
871,378
43,726
8,568
13,522
13,522
35,837
___________ ___________
1,164,463
1,093,468
100
___________ ___________
1,164,463
1,093,468
__________ __________
9,244,667
9,507,421
========== ==========
-
687,151
127,599
5,783
1,625,322
4,939
NLB Group
31.12.2013
942,657
104,335
6,615
1,675,117
5,426
1,266,638
34,064
3,800
36,519
5.8.1.
5.8.2.
5.8.1.
5.8.2.
5.8.3.
5.8.4.
5.8.5.
30.6.2014
659,469
38,971
4,267
36,797
17
9
(53)
(3)
(2)
1,266,638
34,063
3,800
36,519
(48)
14
12
1
40,074
37,425
874,697
1,119,602
8,750,000
8,257,077
148,395
162,309
68,046
68,782
21,973
21,874
102,359
86,609
133
124,607
108,923
215
116
336
370
12,968
14,897
__________ __________
(4)
10,883,174
11,219,137
========== ==========
7
(22)
6
(9)
(1)
0
18
(100)
14
85
(9)
(13)
(3)
200,000
200,000
871,378
871,378
40,567
3,096
13,522
13,522
193,280
159,391
___________ ___________
1,318,747
1,247,387
21
24,879
23,610
___________ ___________
6
1,343,626
1,270,997
__________ __________
(3)
12,226,800
12,490,134
========== ==========
5
6
6
6
(2)
31
Condensed Statement of changes in equity
in thousand EUR
NLB d.d.
Share
capital
Share
premium
200,000
200,000
Balance at January 1, 2014
- Net profit for the period
- Other comprehensive income
Total comprehensive income after tax
Balance at June 30, 2014
Revaluation
reserves
871,378
871,378
8,568
35,158
35,158
43,726
Profit
reserves
Retained Total equity
earnings
13,522
13,522
35,837
35,837
35,837
1,093,468
35,837
35,158
70,995
1,164,463
Share
Share
Other equity Revaluation
Profit
Retained
capital
premium instruments
reserves
reserves
earnings
104,731
774,472
336,044
(5,416) 164,204 (304,874)
(85,826)
(10,496)
(10,496)
(85,826)
1,858
1
-
- Net loss for the period
- Other comprehensive loss
Total comprehensive loss after tax
New share capital subscribed
Conversion of other equity instruments
issued
Other*
77,490
263,727
(213)
184,079 1,037,987
(341,217)
5,173
-
(15,912)
(5,173)
159,031
Treasury
shares
(2,048)
-
(390,700)
Total equity
(2,048)
1,067,113
(85,826)
(10,496)
(96,322)
1,859
(213)
972,437
* Item other relates to costs directly attributable to the issuance of new shares and accrued income from financial instruments with
characteristics of equity.
NLB Group
- Net profit for the period
- Other comprehensive income
Total comprehensive income after tax
Dividends paid
Other*
Share
capital
200,000
200,000
Share
premium
871,378
871,378
Revaluation
reserves
3,096
37,471
37,471
40,567
Profit
reserves
13,522
13,522
Retained
Equity
Equity
earnings attributable attributable
to owners
to nonof the
controlling
parent
interests
159,391
34,014
34,014
(125)
193,280
1,247,387
34,014
37,471
71,485
(125)
1,318,747
23,610
1,347
82
1,429
(179)
19
24,879
Total equity
1,270,997
35,361
37,553
72,914
(179)
(106)
1,343,626
* Item other relates to loss of control of subsidiary and transactions with non-controlling interest.
Share
capital
- Net loss for the period
- Other comprehensive loss
Total comprehensive loss after tax
New share capital subscribed
Conversion of other equity instruments
issued
Other*
774,472
1
336,044
-
(12,754)
(11,873)
(11,873)
-
164,204
-
(239,611)
(91,176)
(91,176)
-
Equity
Equity
Total equity
attributable to attributable
owners of the
to nonparent
controlling
(2,048)
1,125,038 interests
19,946 1,144,984
(91,176)
1,138
(90,038)
(11,873)
(366)
(12,239)
(103,049)
772 (102,277)
1,859
1,859
77,490
263,727
(213)
184,079 1,037,987
(341,217)
5,173
-
(24,627)
(5,173)
159,031
(4,414)
(335,201)
(2,048)
104,731
1,858
Share
premium
Other equity
instruments
Revaluation
reserves
Profit
reserves
Retained
earnings
Treasury
shares
(4,627)
1,019,221
4,371
25,089
(256)
1,044,310
* Item other relates to costs directly attributable to the issuance of new shares, accrued income from financial instruments with characteristics of
equity and transactions with non-controlling interest.
32
Condensed Statement of cash flows
in thousand EUR
CASH FLOWS FROM OPERATING ACTIVITIES
Interest received
Interest paid
Dividends received
Fee and commission receipts
Fee and commission payments
Realized gains from financial assets and financial liabilities not at fair value through profit
or loss
(Losses)/gains from financial assets and liabilities held for trading
Payments to employees and suppliers
Other income
Other expenses
Income tax paid
Cash flows from operating activities before changes in operating assets and
liabilities
Decreases/(increases) in operating assets
Net increase in trading assets
Net (increase)/decrease in financial assets and liabilities designated at fair value through
profit or loss
Net decrease/(increase) in available for sale financial assets
Net decrease in loans and advances
Net (increase)/decrease in other assets
Decreases in operating liabilities
Net decrease in deposits and borrowings from central banks
Net increase/(decrease) in deposits and borrowings measured at amortized cost
Net decrease in securities measured at amortized cost
Net (decrease)/increase in other liabilities
Net cash used in operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Receipts from investing activities
Proceeds from sale of property and equipment and investment property
Proceeds from liquidation of subsidiaries
Proceeds from sale of non-current assets held for sale
Proceeds from maturity and disposal of held to maturity investments
Payments from investing activities
Purchase of property and equipment and investment property
Purchase of intangible assets
Purchase of subsidiaries and increase in subsidiaries' equity
Purchase of held to maturity investments
Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from financing activities
Issue of ordinary shares and other equity instruments
Payments from financing activities
Dividends paid
Repayments of subordinated debt
Other payments related to financing activities
Net cash from financing activities
Effects of exchange rate changes on cash and cash equivalents
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
NLB d.d.
six months ended
June
June
2014
2013
NLB Group
six months ended
June
June
2014
2013
183,469
(69,878)
4,697
63,782
(14,275)
20,767
200,734
(112,248)
1,529
66,614
(13,952)
5,559
263,607
(101,904)
42
92,784
(25,359)
20,834
279,275
(146,195)
368
94,689
(23,008)
8,830
(2,154)
(91,030)
11,752
(9,805)
97,325
1,184
(98,434)
8,478
(9,593)
(342)
49,529
72
(138,322)
20,508
(11,365)
(658)
120,239
2,937
(149,971)
21,839
(11,246)
(1,870)
75,648
127,415
(21,021)
-
225,770
(50,900)
(274)
57,653
(21,021)
1,299
(34,581)
(50,900)
(171)
62,564
85,914
(42)
(345,244)
(600,020)
254,847
(71)
(120,504)
(875)
278,752
(933)
(159,996)
(21)
(127,075)
(32,902)
2
115,303
50,423
26,785
167
(347,929)
(600,020)
252,291
(200)
(170,037)
(97,672)
128,748
(14,586)
(232,354)
(21)
(200,456)
(32,902)
1,025
(191,287)
76,659
13
250
548
75,848
(63,089)
(1,453)
(3,708)
(7,020)
(50,908)
13,570
288,610
73
288,537
(201,072)
(1,971)
(2,940)
(64,107)
(132,054)
87,538
78,631
2,235
548
75,848
(65,991)
(10,919)
(4,164)
(50,908)
12,640
288,746
209
288,537
(140,983)
(5,228)
(3,665)
(36)
(132,054)
147,763
1,513
(106,934)
613,092
507,671
1,859
1,859
(61,676)
(61,463)
(213)
(59,817)
(721)
143,024
575,961
718,264
(183)
(108)
(75)
(183)
2,752
(157,580)
1,430,905
1,276,077
1,859
1,859
(61,676)
(61,463)
(213)
(59,817)
(4,717)
(103,341)
1,573,940
1,465,882
33
STATEMENT OF MANAGEMENT'S RESPONSIBILITY
The Management Board hereby confirms its responsibility for the preparation of the financial statements of the
NLB d.d. and the consolidated financial statements of the NLB Group for the six months ended June 30, 2014.
The Management Board is responsible for the preparation and presentation of these interim financial
statements in accordance with the IAS 34 “Interim financial reporting”.
The Management Board also confirms that the appropriate accounting policies were consistently applied, and
that the accounting estimates were prepared according to the principles of prudence and good management.
The Management Board further confirms that the interim financial statements of the NLB d.d. and NLB Group
have been prepared on a going-concern basis for the NLB d.d. and NLB Group and in line with valid
legislation and the IAS 34 “Interim financial reporting”.
The Management Board is also responsible for appropriate accounting practices, for the adoption of
appropriate measures for the safeguarding of assets, and for the prevention and identification of fraud and
other irregularities or illegal acts.
34
Notes to the condensed financial statements
1.
GENERAL INFORMATION
Nova Ljubljanska banka d.d. Ljubljana (hereinafter: NLB d.d.) is a joint stock entity providing universal banking
services. The NLB Group operates in twelve countries.
The NLB d.d. is incorporated and domiciled in Slovenia. The address of its registered office is Trg Republike 2,
Ljubljana. The NLB d.d.’s shares are not listed on the stock exchange.
The ultimate controlling party of NLB d.d. is the Republic of Slovenia which is the sole shareholder as at June 30,
2014 and December 31, 2013.
All amounts in the financial statements and in the notes to the financial statements are expressed in thousands of
euros unless otherwise stated.
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
2.1.
Statement of compliance
These condensed interim financial statements have been prepared in accordance with IAS 34 “Interim financial
reporting” and should be read in conjunction with the annual financial statements of the NLB Group and NLB d.d.
for the year ended December 31, 2013, which have been prepared in accordance with International Financial
Reporting Standards (hereinafter: IFRS) as adopted by the European Union.
2.2.
Accounting policies
Except as described below, the same accounting policies and methods of computation were followed in the
preparation of these consolidated condensed interim financial statements as for the year ended December 31,
2013.
Accounting standards and amendments to existing standards effective for annual periods beginning on
January 1, 2014 that were endorsed by EU and adopted by the NLB Group
-
IAS 32 (amendment) - Offsetting Financial Assets and Financial Liabilities (effective for annual periods
beginning on or after January 1, 2014).
-
IFRS 10 - Consolidated Financial Statements, IFRS 11 - Joint Arrangements, IFRS 12 - Disclosures of
Interests in Other Entities, a revised version of IAS 27 - Separate Financial Statements, which has been
amended for the issuance of IFRS 10 but retains the current guidance for separate financial statements, and a
revised version of IAS 28 - Investments in Associates and Joint Ventures, which has been amended for
conforming changes based on the issuance of IFRS 10 and IFRS 11. Standards are effective for annual
periods beginning on or after January 1, 2014.
-
Amendments to IFRS 10 Consolidated Financial Statements, IFRS 11 Joint Arrangements, IFRS 12
Disclosures of Interests in Other Entities - Transition Guidance (effective for annual periods beginning on or
after January 1, 2014).
-
Amendments to IFRS 10 Consolidated Financial Statements, IFRS 11 Joint Arrangements, IFRS 12
Disclosures of Interests in Other Entities – Investment Entities (effective for annual periods beginning on or
after January 1, 2014).
-
IAS 39 (amendment) – Novation of Derivatives and Continuation of Hedge Accounting (effective for annual
periods beginning on or after January 1, 2014).
-
IAS 36 (amendment) - Recoverable Amount Disclosures for Non-Financial Assets (effective for annual periods
beginning on or after January 1, 2014).
35
-
IFRIC 21 (new interpretation) – Levies (effective for annual periods beginning on or after January 1, 2014).
Accounting standards and amendments to existing standards issued but not endorsed by EU
-
IFRS 9 - Financial Instruments. Standard was completed in July 2014. A mandatory implementation date is
January 1, 2018 with early application permitted.
-
IAS 19 (amendment) – Defined benefit plans: Employee contributions (effective for annual periods beginning
on or after July 1, 2014).
-
Annual Improvements to IFRSs 2010–2012 Cycle. The improvements comprise a mixture of substantive
changes and clarifications, and are effective for annual periods beginning on or after July 1, 2014.
-
Annual Improvements to the IFRS 2011–2013 Cycle. The improvements comprise a mixture of substantive
changes and clarifications, and are effective for annual periods beginning on or after July 1, 2014.
-
IFRS 14 (new standard) - Regulatory Deferral Accounts (effective for annual periods beginning on or after
January 1, 2016).
-
IFRS 15 (new standard) – Revenue from Contracts with Customers (effective from annual periods beginning
on or after January 1, 2017).
-
Amendments to IAS 16 Property, plant and equipment and IAS 38 Intangible assets – Clarification of
Acceptable Methods of Depreciation and Amortisation (effective from annual periods beginning on or after
January 1, 2016).
-
IFRS 11 (amendment) – Accounting for Acquisition of Interests in Joint Operations (effective from annual
periods beginning on or after January 1, 2016).
36
3.
CHANGES IN SUBSIDIARY HOLDINGS
th
Changes in six months ended June 30 , 2014
a)
Capital increase:
-
-
Increases in share capital in the form of loan conversion in the total amount of EUR 1,765 thousand was
registered at NLB Leasing, Beograd.
Increase in share capital in the form of cash contributions in the total amount of EUR 7,020 thousand was
registered in NLB Srbija, Beograd and CBS Invest, Sarajevo.
Increase in share capital in the form of loan conversion in the total amount of EUR 7,000 thousand was
registered at NLB Leasing, Sofia by NLB Leasing, Ljubljana.
Decrease in share capital in amount of EUR 640 thousand EUR was registered in Plan, Banja Luka.
b)
Other changes:
-
Relevant activities of entities ICJ – v stečaju, Domžale and Conet – v stečaju, Beograd are subject to
bankruptcy manager therefore NLB d.d. has no longer control over these entities.
Increase in share capital in the form of cash contributions in the amount of EUR 15,000 thousand was
registered in NLB Montenegrobanka, Podgorica. NLB d.d. increased its ownership interest from 97.40% to
98.00%.
As at June 5, 2014 simplified decrease with simultaneous increase in share capital was registered in Adria
Bank, Wien. Due to covering the loss from 2013 the share capital at first decreased to 0; in increase in share
capital NLB d.d. did not participate.
-
-
-
Changes in the year 2013
a)
-
-
-
b)
-
Capital increase:
Increases in share capital in the form of cash contributions in the total amount of EUR 172,487 thousand were
registered at NLB Factoring “v likvidaci”, Ostrava, CBS Invest, Sarajevo, NLB Montenegrobanka, Podgorica,
NLB Srbija, Beograd, NLB Leasing, Ljubljana and NLB banka, Beograd. Increase in share capital in the total
amount of EUR 12,000 thousand has not yet been registered in NLB Leasing, Sarajevo.
Increases in share capital in the form of loan conversion in the total amount of EUR 53,750 thousand were
registered at NLB Leasing, Beograd, NLB Leasing, Ljubljana and NLB banka, Beograd.
Increases in share capital in the form of cash contributions from NLB Leasing, Ljubljana in the total amount of
EUR 42,356 thousand were registered at Optima Leasing, Zagreb and OL Nekretnine, Zagreb. Increase in
share capital in the amount of EUR 25,000 thousand has not yet been registered in Optima Leasing, Zagreb.
An increase in share capital in the form of a cash contribution in the total amount of EUR 330 thousand was
registered at NLB Interfinanz Praha, Praga by NLB Interfinanz, Zurich.
Other changes:
NLB Factoring, Ostrava was renamed to NLB Factoring, “v likvidaci”, Ostrava.
NLB Crna Gora d.o.o., Podgorica was established. NLB d.d.'s ownership in NLB Crna Gora d.o.o., Podgorica
is 100%.
NLB d.d. increased its ownership interest in NLB Montenegrobanka, Podgorica from 96.71% to 97.40%.
NLB Leasing, Ljubljana increased its ownership interest in OL Nekretnine, Zagreb, from 99.93% to 100%.
Consideration was paid in the amount of EUR 13 thousand.
NLB Leasing, Ljubljana increased its ownership interest in Optima Leasing, Zagreb, from 99.82% to 99.95%.
Consideration was paid in the amount of EUR 23 thousand.
Plan d.d., Banja Luka changed its legal organizational form to Plan d.o.o, Banja Luka.
LHB Trade d.o.o., Zagreb was renamed to LHB Trade d.o.o. - u likvidaciji, Zagreb.
By converting other items of equity in share capital, the share capital of NLB Vita, Ljubljana has increased for
EUR 184 thousand. NLB d.d.’s share interest in entity remained unchanged.
37
4.
NOTES TO THE CONDENSED INCOME STATEMENT
4.1.
Interest income and expenses
in thousand EUR
NLB d.d.
six months ended
June
June
2014
2013
%
change
NLB Group
six months ended
June
June
2014
2013
%
change
Loans and advances to customers
Financial assets held for trading
Deposits with central banks
TOTAL
Due to customers
Financial liabilities held for trading
Borrowings from banks
Borrowings from other customers
Deposits from banks
Subordinated liabilities
Other financial liabilities
TOTAL
NET INTEREST INCOME
129,380
8,034
15,653
13,520
1,147
2,614
216
________
170,564
=======
139,876
10,286
18,118
11,658
2,068
3,890
245
________
186,141
=======
(8)
(22)
(14)
16
(45)
(33)
(12)
34,729
6,417
9,554
3,605
1,287
281
46
318
________
56,237
=======
________
114,327
=======
58,275
9,978
21,498
4,827
1,453
292
56
4,831
252
________
101,462
=======
________
84,679
=======
(40)
(36)
(56)
(25)
(11)
(4)
(18)
(100)
26
(8)
(45)
35
202,852
7,965
15,653
22,749
1,147
1,225
618
________
252,209
=======
219,576
10,012
18,118
20,463
2,068
2,163
760
________
273,162
=======
(8)
(20)
(14)
11
(45)
(43)
(19)
63,835
6,415
11,273
3,605
1,287
2,219
104
673
515
________
89,926
=======
________
162,283
=======
90,346
9,965
24,703
4,827
1,646
2,227
139
5,433
264
________
139,550
=======
________
133,612
=======
(29)
(36)
(54)
(25)
(22)
(0)
(25)
(88)
95
(8)
(36)
21
38
4.2.
in thousand EUR
NLB d.d.
six months ended
June
June
2014
2013
Credit cards and ATMs
Customer transaction accounts
Payments
Guarantees
Investment banking
Agency of insurance products
Investment funds
Other services
TOTAL
Credit cards and ATMs
Deposit insurance
Investment banking
Payments
Guarantees
Other services
TOTAL
NET FEE AND COMMISSION INCOME
NLB Group
six months ended
June
June
2014
2013
%
change
21,582
16,529
14,400
4,965
2,887
1,371
1,246
1,326
________
64,306
=======
21,564
16,892
14,925
5,421
2,783
1,025
744
1,041
________
64,395
=======
0
(2)
(4)
(8)
4
34
67
27
11,424
955
405
274
1,317
________
14,375
=======
________
49,931
=======
11,138
809
405
324
1,348
________
14,024
=======
________
50,371
=======
3
18
(15)
(2)
(0)
3
(1)
%
change
27,937
20,107
26,571
7,461
4,144
1,371
3,864
2,365
________
93,820
=======
27,725
19,925
26,341
8,372
2,856
1,025
3,981
2,047
________
92,272
=======
1
1
1
(11)
45
34
(3)
16
15,570
4,379
1,170
2,225
306
1,814
________
25,464
=======
________
68,356
=======
14,919
3,903
978
2,101
382
1,764
________
24,047
=======
________
68,225
=======
4
12
20
6
(20)
3
2
6
0
Income from other services include fees from non-banking deposit valuables and safe custody and other agency
services.
Expenses from other services include insurance for holders of personal accounts and golden cards.
4.3.
Gains less losses from financial assets and
liabilities not classified as at fair value through
profit or loss
in thousand EUR
NLB d.d.
six months ended
June
June
2014
2013
Loans and receivables
TOTAL
20,749
5,426
289
133
_________ _________
20,749
5,848
======== ========
%
change
(100)
(100)
-
NLB Group
six months ended
June
June
2014
2013
20,756
5,415
289
133
60
(10,596)
_________ _________
20,816
(4,759)
======== ========
%
change
(100)
(100)
-
39
4.4.
Gains less losses from financial assets and
liabilities held for trading
in thousand EUR
NLB d.d.
six months ended
June
June
2014
2013
Derivatives
Foreign exchange trading
Equity instruments
Debt instruments
TOTAL
4.5.
(6,847)
2,165
1,695
1,482
13
(57)
94
(851)
_________ _________
(5,045)
2,739
======== ========
%
change
14
-
NLB Group
six months ended
June
June
2014
2013
(6,953)
1,925
4,697
4,069
13
(57)
96
(851)
_________ _________
(2,147)
5,086
======== ========
%
change
15
-
in thousand EUR
NLB d.d.
six months ended
June
June
2014
2013
Income from non-banking services
Rental income from investment property
TOTAL
5,954
40
4,388
________
10,382
=======
6,117
46
1,393
________
7,556
=======
%
change
(3)
(13)
37
NLB Group
six months ended
June
June
2014
2013
8,598
2,369
2,659
________
13,626
=======
9,488
2,334
2,337
________
14,159
=======
%
change
(9)
1
14
(4)
Income from non-banking services includes income from IT services, cash transportation and operating leases of
movable property.
4.6.
in thousand EUR
NLB d.d.
six months ended
June
June
2014
2013
Expenses related to issued service guarantees
Taxes and other duties
Membership fees
TOTAL
3,920
3,103
1,038
706
________
8,767
=======
3,915
2,906
798
460
________
8,079
=======
%
change
0
7
30
53
9
NLB Group
six months ended
June
June
2014
2013
3,920
3,754
1,277
1,623
________
10,574
=======
3,915
4,186
1,219
814
________
10,134
=======
%
change
0
(10)
5
99
4
40
4.7.
in thousand EUR
NLB d.d.
six months ended
June
2014
Employee costs
Other general and administrative expenses
TOTAL
4.8.
NLB Group
six months ended
June
2013
51,929
32,392
________
84,321
=======
%
change
55,735
33,807
________
89,542
=======
June
2014
(7)
(4)
(6)
81,582
50,404
________
131,986
=======
June
2013
87,252
52,250
________
139,502
=======
%
change
(6)
(4)
(5)
Provisions for other liabilities and charges
in thousand EUR
NLB d.d.
six months ended
June
2014
Guarantees and commitments
Other provisions
TOTAL
4.9.
21,730
631
________
22,361
=======
June
2013
NLB Group
six months ended
%
change
489
63
________
552
=======
June
2014
-
18,044
2,672
________
20,716
=======
June
2013
%
change
(1,262)
160
________
(1,102)
=======
-
Impairment charge
in thousand EUR
NLB d.d.
six months ended
June
June
2014
2013
Impairment of financial assets
Loans and advances to banks (note 5.4.5.)
Loans and advances to customers (note 5.4.5.)
Impairment of other assets
Other financial assets (note 5.4.5.)
Investments in subsidiaries, associates and joint ventures
Other
TOTAL
%
change
NLB Group
six months ended
June
June
2014
2013
%
change
2,030
(9,912)
35,182
10,701
52,000
(81)
(32)
2,087
(10,023)
46,848
10,701
(66)
128,746
(80)
(64)
1,655
2,056
27
________
31,038
=======
4,229
64,107
________
131,037
=======
(61)
(97)
-
1,511
4,833
________
45,256
=======
6,107
631
________
146,119
=======
(75)
-
(76)
(69)
In six months ended June 2014 the NLB d.d. impaired investment in subsidiaries NLB Leasing, Beograd, Plan,
Banja Luka and CBS Invest, Sarajevo. In six months ended June 2013 the NLB d.d. recorded impairment of
investment in subsidiaries NLB Factoring, “v likvidaci”, Ostrava and CBS Invest, Sarajevo. In NLB Factoring, “v
likvidaci”, Ostrava NLB d.d. consequently released additional allowances for loan given to NLB Factoring, “v
likvidaci”, Ostrava.
41
5.
NOTES TO THE CONDENSED STATEMENT OF FINANCIAL POSITION
5.1.
Cash and balances with central banks
in thousand EUR
30.6.2014
Cash
Balances and obligatory reserves with central banks
91,117
97,864
101,308
276,911
__________ __________
192,425
374,775
========= =========
TOTAL
5.2.
NLB d.d.
31.12.2013 % change
(7)
(63)
(49)
30.6.2014
NLB Group
31.12.2013 % change
181,882
198,209
505,269
744,448
__________ __________
687,151
942,657
========= =========
(8)
(32)
(27)
Trading assets
in thousand EUR
30.6.2014
Derivatives, excluding hedging instruments
Swap contracts
Forward contracts
Options
Total derivatives
Securities
Shares
Bonds
Treasury bills
Commercial papers
Total securities
TOTAL
5.3.
NLB d.d.
31.12.2013
% change
32,069
31,040
2,021
1,266
38
126
___________ ___________
34,128
32,432
3
60
(70)
16,741
16,985
34,993
17,544
32,310
37,818
10,000
___________ ___________
94,044
72,347
___________ ___________
128,172
104,779
======================
(1)
(15)
100
30.6.2014
31,488
2,029
38
___________
33,555
22
% change
30,540
1,322
126
___________
31,988
3
53
(70)
16,741
16,985
34,993
17,544
32,310
37,818
10,000
___________ ___________
94,044
72,347
___________ ___________
127,599
104,335
=========== ===========
(1)
(15)
100
5
-
NLB Group
31.12.2013
5
22
in thousand EUR
30.6.2014
Bonds
Commercial papers
Treasury bills
Shares
Cash certificates
TOTAL
NLB d.d.
31.12.2013
% change
30.6.2014
NLB Group
31.12.2013
% change
872,283
118,792
985,129
-
(11)
100
1,127,004
118,792
1,212,950
-
(7)
100
66,560
58,684
_________
1,116,319
=========
94,961
75,322
_________
1,155,412
=========
(30)
(22)
-
255,203
61,098
63,225
_________
1,625,322
=========
303,024
77,769
81,374
_________
1,675,117
=========
(16)
(21)
(22)
(3)
(3)
42
5.4.
Loans and advances
Analysis by type of loans and advances
in thousand EUR
30.6.2014
Debt securities
Loans to banks
Other financial assets
TOTAL
5.4.1.
NLB d.d.
31.12.2013 % change
717,822
702,791
502,833
376,439
5,260,276
5,426,129
42,837
41,337
__________
__________
6,523,768
6,546,696
=========== ===========
2
34
(3)
4
(0)
30.6.2014
NLB Group
31.12.2013 % change
717,822
702,791
747,687
532,533
6,896,394
7,041,430
56,691
63,919
__________ __________
8,418,594
8,340,673
======================
2
40
(2)
(11)
1
Debt securities
in thousand EUR
NLB d.d. and NLB Group
30.6.2014 31.12.2013 % change
Government
Companies
Banks
Allowance for impairment
TOTAL
5.4.2.
635,325
622,573
82,497
80,218
3,750
3,750
_________ _________
2
3
-
(3,750)
(3,750)
_________ _________
717,822
702,791
=========
===========
2
in thousand EUR
Demand deposits
Time deposits
Loans
Reverse sale and repurchase agreements
Purchased receivables
Allowance for impairment (note 5.4.5.)
TOTAL
NLB d.d.
30.6.2014 31.12.2013 % change
NLB Group
30.6.2014 31.12.2013 % change
246,546
216,085
190,544
63,234
63,998
103,054
4,616
2,387
_________ _________
503,475
386,989
14
(38)
(100)
100
386,724
308,158
341,018
203,891
36,294
44,485
4,616
2,387
_________ _________
766,423
561,150
25
67
(18)
(100)
100
(642)
(10,550)
_________ _________
502,833
376,439
======== ========
(94)
(18,736)
(28,617)
_________ _________
747,687
532,533
======== ========
(35)
30
34
37
40
43
5.4.3.
in thousand EUR
30.6.2014
Loans
Finance lease receivables
Overdrafts
Credit card business
Called guarantees
Reverse sale and repurchase agreement
TOTAL
5.4.4.
NLB d.d.
31.12.2013 % change
6,071,182
6,214,369
202,697
215,100
56,564
59,922
12,343
11,014
25
25
__________ __________
6,342,811
6,500,430
(2)
(6)
(6)
12
-
(1,082,535) (1,074,301)
__________ __________
5,260,276
5,426,129
========= =========
1
(2)
(3)
NLB Group
30.6.2014
31.12.2013 % change
7,844,180
7,939,372
357,575
377,171
336,966
349,253
109,016
112,734
24,636
27,143
25
25
__________ __________
8,672,398
8,805,698
(1)
(5)
(4)
(3)
(9)
-
(1,776,004) (1,764,268)
__________ __________
6,896,394
7,041,430
========= =========
1
(2)
(2)
in thousand EUR
30.6.2014
NLB d.d.
31.12.2013 % change
Receivables in the course of collection
Receivables from purchase agreements for equity securities
Credit card receivables
Fees and commissions due
Dividends
Accrued fees and commissions
Debtors
Prepayments
22,870
12,789
20,591
42,517
10,335
7,983
4,458
5,093
1,681
44
1,188
132
679
1,789
5,398
8,634
__________ __________
67,200
78,981
79
(52)
29
(12)
(62)
(37)
(24,363)
(37,644)
__________ __________
42,837
41,337
========= =========
(35)
TOTAL
5.4.5.
(15)
4
NLB Group
30.6.2014
31.12.2013 % change
24,768
14,511
20,591
42,517
13,491
11,335
7,052
7,281
1,681
44
1,163
244
22,000
23,528
8,119
9,076
10,506
21,467
__________ __________
109,371
130,003
71
(52)
19
(3)
(6)
(11)
(51)
(52,680)
(66,084)
__________ __________
56,691
63,919
========= =========
(20)
(16)
(11)
Movements in allowance for impairment of banks, loans and advances to customers and other
financial assets
in thousand EUR
Banks
2014
2013
Balance at January 1
Impairment (note 4.9.)
Write offs
Repayment of write offs
Exhange differences
Other
Balance at June 2014
10,550
(9,912)
4
________
642
=======
385
3
________
388
=======
NLB d.d.
Customers
2014
2013
1,074,301
35,182
(30,240)
934
103
2,255
________
1,082,535
=======
1,367,571
52,000
(2,840)
490
(2,971)
4,723
________
1,418,973
=======
2014
2013
37,644
1,655
(14,938)
2
________
24,363
=======
25,843
4,229
(170)
(138)
________
29,764
=======
44
in thousand EUR
Banks
2014
2013
Balance at January 1
Exchange differences on opening balance
Impairment (note 4.9.)
Write offs
Repayment of write offs
Exhange differences
Other
Balance at June 2014
5.5.
28,617
169
(10,023)
(27)
________
18,736
=======
14,390
(284)
(66)
283
________
14,323
=======
NLB Group
Customers
2014
2013
1,764,268
1,186
46,848
(38,056)
1,276
(1,773)
2,255
________
1,776,004
=======
2014
2013
1,905,986
(4,050)
128,746
(23,875)
1,587
(139)
________
2,008,255
=======
66,084
17
1,511
(12,510)
35
(2,457)
________
52,680
=======
51,052
122
6,107
(916)
(128)
________
56,237
=======
Held to maturity financial assets
in thousand EUR
30.6.2014
31.12.2013 % change
Bonds
Treasury bills
694,286
728,308
138,706
135,951
_________ _________
832,992
864,259
========= =========
TOTAL
5.6.
(5)
2
(4)
Other assets
in thousand EUR
NLB d.d.
30.6.2014 31.12.2013 % change
Deferred expenses
Assets, received as collateral
Claim for taxes and other dues
Inventories
Prepayments
TOTAL
4,015
1,965
1,606
1,632
487
658
270
270
35
16
_________ _________
6,413
4,541
==================
(2)
(26)
41
NLB Group
30.6.2014 31.12.2013 % change
7,616
4,125
127,966
131,180
1,512
2,908
18,250
23,364
2,010
915
_________ _________
157,354
162,492
==================
85
(2)
(48)
(22)
(3)
45
5.7.
Income tax
in thousand EUR
Current tax on profit
Deferred tax
TOTAL
5.7.1.
NLB d.d.
30.6.2014 30.6.2013
NLB Group
30.6.2014 30.6.2013
(325)
735
10,771
_________ _________
735
10,446
(1,089)
(2,344)
745
22,203
_________ _________
(344)
19,859
======== ========
======== ========
Deferred tax
in thousand EUR
30.6.2014
Deferred income tax assets
Valuation of financial instruments and capital investments
Tax losses
Impairment provisions
Employee benefit provisions
Depreciation and valuation of non-financial assets
Tax reliefs
Dividends
Impairment of deferred tax assets
Total deferred income tax assets
Deferred income tax liabilities
Valuation of financial instruments
Depreciation and valuation of non-financial assets
Impairment provisions
Total deferred income tax liabilities
Net deferred income tax assets
Net deferred income tax liabilities
NLB d.d.
31.12.2013
Included in other comprehensive income for the current year
- valuation of available for sale financial assets
- cash flow hedges
30.6.2014
% change
80,692
242,803
67,233
242,803
20
-
80,715
220,091
67,265
220,091
20
-
3,811
2,197
3,914
2,408
(3)
(9)
17,312
2,398
20,986
2,587
(18)
(7)
389
472
(18)
1,032
1,040
(1)
1,489
1,489
-
1,509
1,509
-
7
(311,402)
_________
19,986
7
(298,340)
_________
19,986
4
7
(303,537)
_________
19,527
7
(294,044)
_________
19,441
3
12,803
255
_________
13,058
6,336
258
_________
6,594
(1)
-
13,286
870
39
_________
14,195
6,890
789
40
_________
7,719
93
10
(3)
6,928
-
13,392
-
(48)
5,668
(336)
12,092
(370)
(53)
(9)
six months ended
Included in the income statement for the current year
- tax losses
- valuation of financial instruments and capital investments
- employee benefit provisions
- impairment provisions
- depreciation and valuation of non-financial assets
- tax reliefs
- dividends
- impairments of deferred income tax assets
% change
NLB Group
31.12.2013
-
98
0
84
six months ended
June
2014
June
2013
June
2014
June
2013
735
14,191
(211)
(103)
(80)
(13,062)
10,771
12,146
(1,248)
(37)
(1)
(61)
(27)
(1)
-
748
14,191
(188)
(3,672)
(90)
(9,493)
22,203
12,146
(855)
(38)
10,960
18
(27)
(1)
-
(7,199)
(7,269)
70
1,142
1,331
(189)
(7,140)
(7,210)
70
1,163
1,352
(189)
46
5.8.
Analysis by type of financial liabilities, measured at amortised cost
in thousand EUR
30.6.2014
Deposits from banks
Borrowings from banks
Due to customers
Borrowings from other customers
TOTAL
5.8.1.
NLB d.d.
31.12.2013 % change
76,054
74,234
772,773
995,133
6,202,883
5,743,673
34,474
36,284
68,046
68,782
76,136
61,609
__________ __________
7,230,366
6,979,715
========= =========
30.6.2014
2
(22)
8
(5)
(1)
24
NLB Group
31.12.2013 % change
40,074
37,425
874,697
1,119,602
8,750,000
8,257,077
148,395
162,309
68,046
68,782
21,973
21,874
102,359
86,609
__________ __________
10,005,544
9,753,678
========= =========
4
7
(22)
6
(9)
(1)
0
18
3
Deposits from banks and amounts due to customers
in thousand EUR
NLB d.d.
30.6.2014 31.12.2013 % change
Deposits on demand
- banks
- other customers
Other deposits
- banks
- other customers
TOTAL
5.8.2.
67,855
3,148,729
30.6.2014
69,232
2,853,447
(2)
10
8,199
5,002
3,054,154 2,890,226
____________________
6,278,937 5,817,907
==================
64
6
8
33,991
4,231,657
NLB Group
31.12.2013 % change
30,396
3,885,588
12
9
6,083
7,029
4,518,343 4,371,489
____________________
8,790,074 8,294,502
==================
(13)
3
6
Borrowings from banks and other customers
in thousand EUR
Loans
- banks
- other customers
TOTAL
NLB d.d.
30.6.2014 31.12.2013 % change
NLB Group
30.6.2014 31.12.2013 % change
772,773
995,133
34,474
36,284
_________ _________
807,247 1,031,417
======== ========
874,697 1,119,602
148,395
162,309
_________ _________
1,023,092 1,281,911
======== ========
(22)
(5)
(22)
(22)
(9)
(20)
47
5.8.3.
in thousand EUR
30.6.2014
Carrying amount of issued securities
- traded on active markets
68,046
Bonds (in %)
- fixed rated
- floating rated
5.8.4.
NLB d.d.
31.12.2013 % change
68,782
NLB Group
30.6.2014 31.12.2013 % change
(1)
100.00
100.00
_________ _________
100.00
100.00
======== ========
68,046
68,782
(1)
100.00
100.00
_________ _________
100.00
100.00
======== ========
in thousand EUR
NLB Group
Currency
Due date
30.6.2014
Carrying Nominal
amount
value
Interest rate
31.12.2013
Carrying Nominal
amount
value
% change
Subordinated
loans
EUR
EUR
EUR
30.12.2014 6 months EURIBOR + 5.1% p.a. to 22.03.2014,
thereafter 6 months EURIBOR + 8.5% p.a.
30.6.2018
6 months EURIBOR + 4.2% p.a. to 22.09.2013,
thereafter 6 months EURIBOR + 6.3% p.a.
30.6.2020
6 months EURIBOR + 5.7% p.a. to 30.6.2015, thereafter
6 months EURIBOR + 7.7% p.a.
TOTAL
5.8.5.
4,610
4,500
4,568
4,500
1
12,239
12,000
12,136
12,000
1
5,170
5,000
_________ _________
21,874
21,500
==================
(1)
5,124
5,000
__________________
21,973
21,500
=========
=========
0
in thousand EUR
NLB d.d.
30.6.2014 31.12.2013 % change
Items in the course of payment
Debit or credit card payables
Accrued expenses
Accrued salaries
Suppliers
Fees and commissions due
Liabilities to brokerage firms and others for securities purchase
TOTAL
30,738
13,614
14,796
13,580
10,622
4,628
7,049
8,784
3,949
10,486
37
815
1,047
8,945
8,655
____________________
76,136
61,609
==================
9
(20)
(62)
(95)
(100)
3
24
NLB Group
30.6.2014 31.12.2013 % change
39,867
23,735
15,457
14,644
16,457
10,207
9,714
9,975
7,046
13,027
92
838
1,047
13,726
13,136
____________________
102,359
86,609
==================
68
6
61
(3)
(46)
(89)
(100)
4
18
48
5.9.
Provisions
in thousand EUR
Provisions for performance guarantees
Provisions for financial guarantees
Provisions for other credit commitments
Employee benefit provisions
Restructuring provisions
Provision for legal issues
Provisions for premiums from National Housing Saving Scheme
Other provisions
TOTAL
NLB d.d.
30.6.2014 31.12.2013 % change
NLB Group
30.6.2014 31.12.2013 % change
35,862
36,270
23,963
11,303
14,668
6,952
12,226
11,842
8,109
10,866
1,729
1,094
877
877
7,875
7,876
________ ________
105,309
87,080
======= =======
36,835
38,075
28,089
18,112
18,986
11,424
15,746
15,425
8,574
11,803
7,620
5,327
877
877
7,880
7,880
________ ________
124,607
108,923
======= =======
(1)
3
(25)
58
(0)
21
(3)
55
66
2
(27)
43
14
5.10. Income tax relating to components of other
comprehensive income
in thousand EUR
NLB d.d.
30.6.2014
30.6.2013
Tax
Tax
Before tax (expense)/ Net of tax
amount
credit
amount
amount
credit
amount
Cash flow hedge
TOTAL
42,767
(7,269)
35,498
(410)
70
(340)
________ ________ ________
42,357
(7,199)
35,158
======= ======= =======
(12,413)
775
________
(11,638)
=======
1,331
(189)
________
1,142
=======
(11,082)
586
________
(10,496)
=======
in thousand EUR
NLB Group
30.6.2014
30.6.2013
Tax
Tax
amount
credit
amount
amount
credit
amount
Cash flow hedge
Effects of translation of foreign operations to presentation currency
Share of associates and joint ventures
TOTAL
42,294
(7,210)
35,084
(410)
70
(340)
(982)
(982)
4,530
(739)
3,791
________ ________ ________
45,432
(7,879)
37,553
======= ======= =======
(13,013)
775
274
(1,745)
________
(13,709)
=======
1,352
(189)
307
________
1,470
=======
(11,661)
586
274
(1,438)
________
(12,239)
=======
49
5.11. Other liabilities
in thousand EUR
NLB d.d.
30.6.2014 31.12.2013 % change
Taxes payable
Deferred income
Payments received in advance
TOTAL
3,686
5,132
1,294
766
44
106
__________ __________
5,024
6,004
======== ========
NLB Group
30.6.2014 31.12.2013 % change
(28)
69
(58)
(16)
5,263
7,517
5,813
4,473
1,892
2,907
__________ __________
12,968
14,897
======== ========
(30)
30
(35)
(13)
5.12. Book value per share
The book value of a NLB d.d. share as at June 30, 2014 was EUR 58.2 (December 31, 2013: EUR 54.7) and on a
consolidated level it was EUR 65.9 (December 31, 2013: EUR 62.4). It is calculated as the ratio of net assets book
value and the number of shares. NLB d.d. and NLB Group don’t have any other equity instruments issued and
treasury shares.
5.13. Capital adequacy ratio
in thousand EUR
NLB d.d.
30.6.2014 31.12.2013
OWN FUNDS
TIER I CAPITAL
COMMON EQUITY TIER 1 CAPITAL
Capital instruments eligible as CET1 Capital
Paid up capital instruments
Share premium
Other reserves
Non-controlling interest
Accumulated other comprehensive income
Adjustments to CET1 due to prudential filters
Goodwill
Other intangible assets
Deferred tax assets that rely on future profitability and do not arise from temporary differences
net of associated tax liabilities
DEDUCTIONS FROM TIER I AND TIER II CAPITAL (equity investments in banks and
financial institutions)
TIER 2 CAPITAL
TOTAL RISK EXPOSURE AMOUNT
Total risk weighted exposure amount for credit risk (standardised approach)
Total risk weighted exposure amount for market risks
Total risk weighted exposure amount for credit value adjustment risks
Total risk weighted exposure amount for operational risks
CAPITAL ADEQUACY RATIO (in %)
TIER I RATIO (in %)
CORE TIER I RATIO (in %)
NLB Group
30.6.2014
31.12.2013
1,041,652
1,041,652
1,041,652
1,071,378
200,000
871,378
13,522
(644)
(2,510)
(39,061)
1,030,731
1,039,061
200,000
871,378
12,892
(233)
(44,976)
1,177,877
1,177,877
1,177,877
1,071,378
200,000
871,378
161,726
(3,436)
(3,016)
(3,529)
(44,494)
1,218,566
1,199,596
200,000
871,378
159,515
24,048
(672)
(3,713)
(50,960)
(1,033)
-
(752)
-
5,347,045
4,635,192
71,500
6,063
634,290
19.5%
19.5%
19.5%
(18,259)
9,929
6,216,525
5,436,475
57,785
722,265
16.6%
16.6%
16.6%
7,489,223
6,287,821
181,801
6,063
1,013,538
15.7%
15.7%
15.7%
(7,920)
26,890
8,005,380
6,593,705
249,107
1,162,568
15.2%
14.9%
14.9%
Due to new Capital Requirements Directive (CRD IV) data is not comparable.
50
5.14. Off-balance sheet liabilities
in thousand EUR
Commitments to extend credit
Performance guarantees
Financial guarantees
Letters of credit
Other
Provisions (note 5.9.)
TOTAL
NLB d.d.
30.6.2014 31.12.2013 % change
NLB Group
30.6.2014 31.12.2013 % change
884,079
836,999
467,206
489,417
211,336
238,399
1,152
1,423
5,386
5,382
_________ _________
1,569,159 1,571,620
6
(5)
(11)
(19)
0
1,007,310
952,473
524,799
548,944
370,616
399,403
14,252
17,699
15,683
15,692
_________ _________
1,932,660 1,934,211
6
(4)
(7)
(19)
(0)
(74,493)
(54,525)
_________ _________
1,494,666 1,517,095
======== ========
37
(83,910)
(67,611)
_________ _________
1,848,750 1,866,600
======== ========
24
(0)
(1)
(0)
(1)
5.15. Fair value hierarchy of financial and nonfinancial assets and liabilities
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. The NLB Group uses various valuation techniques to
determine fair value. IFRS 13 specifies a fair value hierarchy with respect to the inputs and assumptions used to
measure financial and non-financial assets and liabilities at fair value. Observable inputs reflect market data
obtained from independent sources, while unobservable inputs reflect the assumptions of NLB d.d. and the NLB
Group. This hierarchy gives the highest priority to observable market data when available and the lowest priority to
unobservable market data. The NLB Group considers relevant and observable market prices in its valuations where
possible. The fair value hierarchy comprises the following levels:
-
-
-
Level 1 – Quoted prices (unadjusted) on active markets. This level includes listed equities, debt instruments,
derivatives, units of investment funds and other unadjusted market prices of assets and liabilities. When an
asset or liability may be exchanged on multiple active markets, the principal market for the asset or liability
must be determined. In the absence of a principal market, the most advantageous market for the asset or
liability must be determined.
Level 2 – Valuation technique where inputs are observable, either directly (i.e. prices) or indirectly (i.e. derived
from prices). Level 2 includes quoted prices for similar assets or liabilities on active markets and quoted prices
for identical or similar assets and liabilities on markets that are not active. The sources of input parameters for
financial instruments, such as yield curves, credit spreads, foreign exchange rates, and the volatility of interest
rates and foreign exchange rates, are Reuters and Bloomberg.
Level 3 – Valuation technique where inputs are not based on observable market data. Unobservable inputs
are used to the extent that relevant observable inputs are not available. Unobservable inputs must reflect the
assumptions that market participants would use when pricing an asset or liability. This level includes nontradable shares and bonds and derivatives associated with these investments and other assets and liabilities,
for which fair value cannot be determined with observable market inputs.
Where possible, fair value is determined as an observable market price on an active market for an identical asset
or liability. An active market is a market on which transactions for an asset or liability are executed with sufficient
frequency and volume to provide pricing information on an ongoing basis. Assets and liabilities measured at fair
value on active markets are determined as the market price of a unit (e.g. share) at the measurement date,
multiplied by the quantity of units owned by the NLB Group. The fair value of assets and liabilities whose market is
not active is determined using valuation techniques. Valuation techniques bear a different intensity level of
estimates and assumptions, depending on the availability of observable market inputs associated with the asset or
liability that is the subject of valuation. Unobservable inputs shall reflect the estimates and assumptions that other
market participants would use when pricing the asset or liability.
51
For non-financial assets measured at fair value and not classified within Level 1, fair value is determined based on
valuation reports provided by certified valuators. Valuations are prepared in accordance with the International
Valuation Standards (IVS).
a)
Financial and non-financial assets and liabilities, measured at fair value in the financial statements
30.6.2014
in thousand EUR
NLB d.d.
Financial assets
Financial instruments held for trading
Debt instruments
Equity instruments
Derivatives
Financial assets designated at fair value through profit
or loss
Debt instruments
Equity instruments
Financial assets available for sale
Debt instruments
Equity instruments
Financial liabilities
Derivatives
Financial liabilities designated at fair value through
profit or loss
Non-financial assets
Investment property
Non-current assets held for sale
NLB Group
Level 1
Level 2
Level 3
Total fair
value
Level 1
Level 2
Level 3
Total fair
value
61,172
61,150
22
-
46,210
12,119
34,091
4,939
20,790
4,034
16,719
37
-
128,172
77,303
16,741
34,128
4,939
61,172
61,150
22
-
45,637
12,119
33,518
4,939
20,790
4,034
16,719
37
-
127,599
77,303
16,741
33,555
4,939
4,268
4,268
959,133
917,505
149,963
136,799
4,268
4,268
7,223 1,116,319
3,331 1,057,635
4,268
4,268
1,338,636
1,295,506
1,515
882
633
279,059
265,387
41,628
13,164
3,892
58,684
43,130
13,672
4,296
61,098
-
34,951
34,951
36,797
4,021
4,021
-
38,972
38,972
36,797
-
34,950
34,950
36,797
4,021
4,021
-
38,971
38,971
36,797
4,267
-
-
4,267
4,267
-
-
4,267
-
1,458
2,839
-
1,458
2,839
-
40,879
7,350
-
40,879
7,350
5,783
882
4,901
7,627 1,625,322
3,331 1,564,224
31.12.2013
in thousand EUR
NLB d.d.
NLB Group
Total fair
value
Level 1
Level 2
47,915
47,649
266
3,801
3,801
1,561,557
1,488,938
72,619
35,525
3,655
31,870
5,426
2,814
895
1,919
105,273
104,837
436
Level 1
Level 2
Level 3
Financial assets
47,915
Debt instruments
47,649
Equity instruments
266
Derivatives
Financial assets designated at fair value through profit or loss3,801
Debt instruments
Equity instruments
3,801
1,131,068
Debt instruments
1,059,986
Equity instruments
71,082
Financial liabilities
35,969
3,655
32,314
5,426
16,531
16,531
-
20,895
104,779
4,058
55,362
16,719
16,985
118
32,432
5,426
3,801
3,801
7,813 1,155,412
3,573 1,080,090
4,240
75,322
Derivatives
Financial liabilities designated at fair value through
profit or loss
Non-financial assets
Investment property
Non-current assets held for sale
Level 3
Total fair
value
20,895
104,335
4,058
55,362
16,719
16,985
118
31,988
5,426
6,615
895
5,720
8,287 1,675,117
3,573 1,597,348
4,714
77,769
-
30,148
30,148
36,519
3,916
3,916
-
34,064
34,064
36,519
-
30,147
30,147
36,519
3,916
3,916
-
34,063
34,063
36,519
3,800
-
-
3,800
3,800
-
-
3,800
-
1,458
2,327
-
1,458
2,327
-
34,844
7,101
10,481
34,844
17,582
52
b)
Significant transfers of financial instruments between levels of valuation
The NLB Group’s policy of transfers of financial instruments between levels of valuation is illustrated in the table
below.
Fair value
hierarchy
1
Equities
market value from
exchange market
Equity stake
Funds
regular valuation by fund
management company
2
3
valuation model
Transfers
valuation model
Debt securities
market value from exchange
market
valuation model
Derivatives
Currency
Equities
valuation model
(underlying
instrument in level 1)
valuation model
(underlying
instrument in level 3)
valuation model
other
from 1 to 3 level
equity excluded from
exchange market
from 1 to 3 level
fund management stops
publishing regular
valuation
from 1 to 2 level
debt securities excluded from
exchange market
from 2 to 3 level
underlying instrument
excluded from
exchange market
from 1 to 3 level
companies in insolvency
proceedings
from 3 to 1level
fund management starts
publishing regular
valuation
from 1 to 2 level
debt securities not liquid (no
trading for 6 months)
from 3 to 2 level
underlying instrument
included into
exchange market
from 1 to 2 level
signing binding
agreement to sale the
equity
from 1 to 3 and from 2 to 3 level
companies in insolvency
proceedings
from 3 to 1 level
equity included into
exchange market
from 2 to 1 and from 3 to 1 level
start trading with debt securities
on exchange market
Interest
valuation model
valuation model
from 3 to 2 level
until valuation parameters are
confirmed on ALCO (at least on
quarterly basis)
30.6.2014
in thousand EUR
Level 2
Level 1
Financial assets
- debt instruments
- equity instruments
from
to
from
to
Level 3
from
-
1,248
(1,248)
-
-
-
(10,594)
-
-
10,594
-
-
30.6.2013
in thousand EUR
Level 2
Level 1
Financial assets
- debt instruments
to
from
to
-
from
-
to
-
1,588
Level 3
from
(1,588)
to
-
53
c)
Financial and non-financial assets and liabilities in 2nd level regarding the fair value hierarchy
Financial instruments in Level 2 of the fair value hierarchy at NLB d.d. and the NLB Group include:
- debt securities: government bonds not quoted on active markets;
- equities: investment funds; and
- derivatives: derivatives except forward derivatives and options on equity instruments that are not quoted on
active markets.
The majority of financial assets classified in Level 2 are debt instruments available for sale (December 31, 2013:
bonds and derivatives held for trading).
When valuing bonds classified in Level 2, the NLB Group primarily uses the income approach based on an
estimation of future cash flows discounted to present value. The input parameters used in the income approach are
the risk free yield curve and the spread over the yield curve (credit, liquidity, country).
Fair values for derivatives are determined using a discounted cash flow model based on the risk-free yield curve.
Fair values for options are determined using valuation models for options (Garman and Kohlhagen model, binomial
model and Black-Scholes model).
At least three valuation methods are used for the valuation of investment property. The majority of investment
property is valued using the income approach, where the present value of future expected returns is assessed.
When valuing investment property, average rents at similar locations and capitalization ratios, such as the risk-free
yield, risk premium, liquidity premium, risk premium to account for the management of the investment and risk
premium to account for capital preservation are used. Rents at similar locations are generated from various
sources, such as data from lessors and lessees, web databases and own databases. The NLB Group has
observable data for all investment property at its disposal. If observable data for similar locations is not available,
the NLB Group uses data from wider locations and appropriately adjusts such data.
Non-current assets held for sale represent equity investments and property, plant and equipment that are
measured at fair value less costs to sell, because it is lower than the previous carrying amount of those assets.
d)
Financial and non-financial assets and liabilities in Level 3 of the fair value hierarchy
Financial instruments in Level 3 of the fair value hierarchy in NLB d.d. and NLB Group include:
- debt securities: structured debt securities from inactive emerging markets; and
- equities: mainly Slovenian corporate and financial equities that are not quoted on active markets;
- derivative financial instruments: forward derivatives and options on equity instruments that are not quoted on
an active organized market. Fair values for forward derivatives are determined using the discounted cash flow
model. Fair values for equity options are determined using valuation models for options (Garman and
Kohlhagen model, binomial model and Black-Scholes model). Unobservable inputs include the fair values of
underlying instruments determined using valuation models. The source of observable market inputs is the
Reuters information system.
The majority of financial assets classified in Level 3 are shares and ownership interests in companies and financial
entities. The NLB Group uses three valuation methods for the valuation of equity financial assets: the income
approach, market approach and cost approach.
The most commonly used valuation technique is the income approach. The income approach is based on an
estimation of future cash flows discounted to present value. Estimations of the cash flows that an entity will be able
to generate in the future are crucial for future cash flows. The NLB Group makes projections of income statements
and statements of financial position from which it derives cash flow projections for a longer period. The key
variables that affect the amount of cash flows, and thus the estimated fair value of the financial asset, also include
an assumption regarding the long-term EBITDA margin. A discount rate that is appropriate for the risks associated
with the realization of these benefits is used to discount cash flows. The discount rate is determined as the
weighted average cost of capital. A forecast of future cash flows and a calculation of the weighted average cost of
capital is prepared for an accurate forecasting period (usually 10 years from the date of the prediction value), and
for a period following the period of accurate forecasting. Assumptions of long-term stable growth in the amount of
2.5% are used for the period following the period of accurate forecasting. NLB Group can select values of
unobservable input data in a reasonable possible range, but uses those input data that other market participants
would use.
54
The following assumptions have been used when valuing available-for-sale financial assets and financial assets
held for trading classified in level 3:
30.6.2014
31.12.2013
Long term weighted average cost of capital
EBITDA margin
Long term free cash flow growth
6,8 %-12,7 %
6,7 %-22 %
2,5 %
6,8 %-12,7 %
6,7 %-22 %
2,5 %
EBITDA margin
6,8 %-12,7 %
6,7 %-22 %
2,5 %
6,8 %-12,7 %
6,7 %-22 %
2,5 %
When valuing derivatives in Level 3, the value of underlying instruments and the risk-free yield curve have been
used in the valuation approach.
Sensitivity to valuation
Sensitivity to the valuation assumptions disclosed in the table below is illustrated by how much the fair value of
financial instruments in Level 3 would increase or decrease if management had used reasonably possible
alternative valuation assumptions that were not based on observable market data. Presentation of the sensitivity to
valuation based on the discounted cash flow model includes a range of estimated values of the extent of the
increase or decrease of the assumptions used in amount of 10% of the value applied.
Free cash flow method
in thousand EUR
30.6.2014
10%
-10%
31.12.2013
10%
-10%
EBITDA margin
(150)
337
46
142
(336)
(43)
(164)
372
196
162
(366)
(45)
EBITDA margin
(1,151)
1,966
359
1,503
(1,966)
(336)
(1,151)
1,966
359
1,503
(1,966)
(336)
Movements of financial assets and liabilities in Level 3
in thousand EUR
NLB d.d.
Valuation:
- through profit or loss
- recognized in other comprehensive income
Exchange differences
Purchases
Sales, issues and settlements
Financial assets available
for sale
Debt
Equity
Debt
Equity
Derivatives
instruments instruments
4,058
16,719
118
3,573
2
(81)
15
36
120
196
(182)
(453)
_________ _________ _________ _________
4,034
16,719
37
3,331
========= ================== =========
4,240
Total
financial
assets
Financial
liabilities
held for
trading
Derivatives
28,708
3,916
(79)
105
(2)
13
36
316
(346)
(981)
_________ _________
_________
3,892
28,013
4,021
================== =========
55
in thousand EUR
Financial assets held for
trading
Debt
Equity
NLB d.d.
Valuation:
Purchases
Transfer out of level 3
2,323
17,574
85
6
(1,588)
_________ _________
826
17,574
========= =========
Financial
assets
available for
sale
Equity
instruments
14,751
Total
financial
assets
Financial
liabilities
held for
trading
Derivatives
34,648
4,153
(542)
(457)
778
(1,622)
(1,622)
6
513
513
(103)
(1,691)
_________ _________
_________
12,997
31,397
4,931
================== =========
in thousand EUR
NLB Group
Valuation:
Purchases
Sales, issues and settlements
Financial assets available
for sale
Debt
Equity
Debt
Equity
Derivatives
4,058
16,719
118
3,573
2
(81)
15
36
120
196
(182)
(453)
_________ _________ _________ _________
4,034
16,719
37
3,331
========= ================== =========
4,714
Total
financial
assets
Financial
liabilities
held for
trading
Derivatives
29,182
3,916
(79)
105
(3)
12
36
316
(357)
(992)
(58)
(58)
_________ _________
_________
4,296
28,417
4,021
================== =========
in thousand EUR
NLB Group
Effects of translation of foreign operations to presentation currency
Valuation:
Purchases
Transfers into level 3
Financial assets held for
trading
Debt
Equity
2,323
-
17,574
-
85
6
(1,588)
_________ _________
826
17,574
========= =========
Financial
assets
available for
sale
Equity
instruments
15,193
(4)
Total
financial
assets
Financial
liabilities
held for
trading
Derivatives
35,090
(4)
4,153
-
(542)
(457)
778
(1,621)
(1,621)
6
513
513
383
383
(139)
(1,727)
_________ _________
_________
13,783
32,183
4,931
================== =========
NLB d.d. and the NLB Group recognize effects from the valuation of trading instruments in the income statement
item Gains less losses from financial assets and liabilities not classified at fair value through profit or loss and
exchange differences recognized in the income statement item Foreign exchange translation gains less losses.
Effects from the valuation of available-for-sale financial assets are recognized in the income statement item
Impairment charge and in the other comprehensive income item Available-for-sale financial assets.
56
In six months 2014 and 2013 the NLB d.d. and the NLB Group recognized the following unrealized gains or losses
for financial instruments that are in level 3 as at June 30, 2014 and June 30, 2013:
in thousand EUR
30.6.2014
NLB d.d.
Available for sale
financial assets
Trading
assets
Items of Income statement
Impairment charge
Item of Other comprehensive income
Trading
liabilities
NLB Group
Available for sale
financial assets
Trading
assets
Trading
liabilities
(79)
10
-
(105)
-
(79)
10
(56)
-
(105)
-
-
-
-
-
2
-
in thousand EUR
30.6.2013
NLB d.d.
Available for sale
financial assets
Trading
assets
Trading
liabilities
NLB Group
Available for sale
financial assets
Trading
assets
Trading
liabilities
Items of Income statement
Impairment charge
2
6
(542)
-
(778)
-
2
6
(542)
-
(778)
-
Item of Other comprehensive income
-
(1,622)
-
-
(1,573)
-
e)
Fair value of financial instruments not measured at fair value in financial statements
in thousand EUR
NLB d.d.
30.6.2014
31.12.2013
Carrying
Carrying
value Fair value
value Fair value
NLB Group
30.6.2014
31.12.2013
Carrying
Carrying
value Fair value
value Fair value
Loans and advances
- debt securities
- loans to government
- loans to financial organizations
- loans to individuals
- loans to other customers
Held-to-maturity investments
717,822
502,833
5,260,276
341,954
659,928
1,871,468
2,386,926
42,837
832,992
700,475
510,045
5,135,696
371,855
688,312
1,879,483
2,196,046
42,837
889,437
702,791
376,439
5,426,129
353,339
655,236
1,858,175
2,559,379
41,337
864,259
677,833
383,245
5,339,782
379,734
698,083
1,852,633
2,409,332
41,337
882,573
717,822
700,475
747,687
744,115
6,896,394 6,745,290
472,774
499,421
192,968
199,457
2,752,218 2,778,188
3,478,434 3,268,224
56,691
56,691
832,992
832,992
702,791
532,533
7,041,430
479,420
169,421
2,716,082
3,676,507
63,919
864,259
677,833
555,905
6,906,445
478,803
176,472
2,731,964
3,519,206
63,919
882,573
- due to customers
76,054
772,773
6,202,883
34,474
68,046
76,136
75,111
751,746
6,223,936
34,276
66,375
76,136
74,234
995,133
5,743,673
36,284
68,782
61,609
73,260
940,863
5,759,602
34,859
64,305
61,609
40,074
40,014
874,697
854,450
8,750,000 8,803,439
148,395
150,342
68,046
66,375
21,973
19,934
102,359
102,359
37,425
1,119,602
8,257,077
162,309
68,782
21,874
86,609
36,340
1,063,486
8,320,225
162,512
64,305
20,686
86,609
The estimated fair value of deposits is based on discounted cash flows using prevailing money market interest
rates for debts with similar credit risk and residual maturities. The fair value of overnight deposits equals their
carrying value.
57
Loans and advances are net of the allowance for impairment. The estimated fair value of loans and advances
represents the discounted amount of estimated future cash flows expected to be received. Expected cash flows are
discounted at current market rates to determine their fair value.
Deposits and borrowings
The fair value of sight deposits and overnight deposits is equal to their carrying value. However, their actual value
for the NLB Group depends on timing and amounts of cash flows, current market rates and the credit risk of the
depository institution itself. A portion of sight deposits is stable, similar to term deposits. Therefore, their economic
value for the NLB Group differs from the carrying amount.
The estimated fair value of other deposits and borrowings from customers is based on discounted cash flows using
interest rates for new deposits with similar residual maturities.
Held to maturity financial assets and issued debt securities
The fair value of held to maturity financial assets and issued debt securities is based on their quoted market price
or value calculated by using a discounted cash flow method and prevailing money market interest rates.
Loan commitments
For credit facilities that are drawn soon after the NLB Group grants the loans (drawn at market rates) and loan
commitments to those clients that are not impaired, the fair value is close to zero. For loan commitments to clients,
that are impaired, the fair value represents the amount of the created provisions.
Other financial assets and liabilities
The carrying amount of other financial assets and liabilities is a reasonable approximation of their fair value, as
they relate mainly to short-term receivable and payables.
Fair value hierarchy of financial instruments not measured at fair value in financial statements
in thousand EUR
30.6.2014
Loans and advances
- debt securities
Financial liabilities measured at amortized
cost
- due to customers
NLB d.d.
NLB Group
Level 3
Total fair
value
Level 1
Level 2
Level 3
Total fair
value
Level 1
Level 2
-
700,475
510,045
5,135,696
371,855
688,312
1,879,483
2,196,046
42,837
889,437
700,475
510,045
- 5,135,696
371,855
688,312
- 1,879,483
- 2,196,046
42,837
889,437
-
700,475
744,115
6,745,290
499,421
199,457
2,778,188
3,268,224
56,691
832,992
-
700,475
744,115
6,745,290
499,421
199,457
2,778,188
3,268,224
56,691
832,992
66,375
-
75,111
751,746
6,223,936
34,276
76,136
75,111
751,746
- 6,223,936
34,276
66,375
76,136
66,375
-
40,014
854,450
8,803,439
150,342
19,934
102,359
-
40,014
854,450
8,803,439
150,342
66,375
19,934
102,359
58
in thousand EUR
31.12.2013
NLB d.d.
Financial liabilities measured at amortized
cost
- due to customers
Total fair
value
Level 1
Level 2
Level 3
Total fair
value
677,833
383,245
5,339,782
379,734
698,083
1,852,633
2,409,332
41,337
882,573
677,833
383,245
- 5,339,782
379,734
698,083
- 1,852,633
- 2,409,332
41,337
882,573
-
677,833
555,905
6,906,445
478,803
176,472
2,731,964
3,519,206
63,919
882,573
-
677,833
555,905
6,906,445
478,803
176,472
2,731,964
3,519,206
63,919
882,573
73,260
940,863
5,759,602
34,859
61,609
73,260
940,863
- 5,759,602
34,859
64,305
61,609
64,305
-
36,340
1,063,486
8,320,225
162,512
20,686
86,609
-
36,340
1,063,486
8,320,225
162,512
64,305
20,686
86,609
Level 1
Level 2
-
64,305
-
Loans and advances
- debt securities
NLB Group
Level 3
5.16. Offsetting financial assets and financial
liabilities
NLB Group entered into foreign exchange netting arrangements with certain banks and companies. Cash flows
from all FX derivatives with counterparties that are due on the same day are settled on a net basis, i.e. a single
cash flow for each currency. Assets and liabilities related to these FX netting arrangements are not presented in a
net amount in the statement of financial position, as netting rules apply to cash flows and not to an instrument as a
whole.
In accordance with the European Market Infrastructure Regulation (EMIR), the NLB Group also novated certain
standardized derivative financial instruments to a central counterparty in 2013. A system of daily margins assures
the mitigation and collateralization of exposures, as well as the daily settlement of cash flows for each currency.
30.6.2014
in thousand EUR
NLB d.d.
FINANCIAL ASSETS/LIABILITIES
Amounts not set off in the
statement of financial position
Gross amounts of
recognised financial
assets/liabilities
Net amounts of financial
assets/liabilities
presented in the
statement of financial
position
Gross amounts set off in
the statement of financial
position
Impact of
master netting
agreements
Financial
instruments
collateral
Net amount
Derivatives - assets
30,811
-
30,811
11,724
3,625
15,462
Derivatives - liabilities
48,713
-
48,713
11,724
19,907
17,082
59
31.12.2013
in thousand EUR
NLB d.d.
Amounts not set off on the
Gross amounts of
assets/liabilities
assets/liabilities
presented in the
position
position
Impact of
master netting
agreements
Financial
instruments
collateral
Net amount
14,712
-
14,712
1,305
-
13,407
28,596
-
28,596
-
1,152
27,444
30.6.2014
in thousand EUR
NLB Group
Gross amounts of
assets/liabilities
assets/liabilities
presented in the
position
position
Impact of
master netting
agreements
Financial
instruments
collateral
Net amount
30,230
-
30,230
11,724
3,625
14,881
48,713
-
48,713
11,724
19,907
17,082
31.12.2013
in thousand EUR
NLB Group
Gross amounts of
assets/liabilities
assets/liabilities
presented in the
position
position
Impact of
master netting
agreements
Financial
instruments
collateral
Net amount
14,212
-
14,212
1,305
-
12,907
28,596
-
28,596
-
1,152
27,444
60
6.
EVENTS AFTER THE END OF THE REPORTING PERIOD
At July 3, 2014 NLB d.d. successfully completed issue of three year unsecured bond with nominal value EUR
300,000 thousand and annual coupon 2.875% on the international capital markets. The bond, which was awarded
international ratings BB-/BB- by rating agencies Fitch and Standard & Poors, is listed on Luxemburg Stock
Exchange.
61
7.
OTHER DISCLOSURES
7.1.
Related-party transactions
The volumes of related party transactions and the outstanding balances:
in thousand EUR
Management Board and
other Key management
personnel
Family members of the
Management Board and
other Key management
personnel
30.6.2014
30.6.2014
31.12.2013
Companies in which members
of Management board, Key
management personnel or their
family members have the
control, joint control or
significant influence
31.12.2013
30.6.2014
31.12.2013
Supervisory Board
30.6.2014
31.12.2013
Loans and deposits issued
2,307
2,604
486
638
527
588
45
48
Loans and deposits received
2,199
2,942
1,162
1,268
164
221
124
66
-
4
-
-
-
-
-
-
324
367
132
171
42
41
15
3
2
-
2
-
-
-
-
-
7
-
-
-
-
-
-
-
Guarantees issued and
commitments to extended credit
six months ended
June
June
2014
2013
Interest income
Interest expenses
Fee income
30
(25)
7
six months ended
June
June
2014
2013
34
(38)
8
8
(8)
3
six months ended
June
June
2014
2013
11
(19)
4
six months ended
June
June
2014
2013
7
3
9
2
1
(1)
-
(2)
1
in thousand EUR
NLB d.d.
Shareholders with
Ultimate parent
30.6.2014
NLB Group
31.12.2013
30.6.2014
Shareholders with
Ultimate parent
31.12.2013
30.6.2014
31.12.2013
30.6.2014
31.12.2013
212,505
212,343
-
-
221,146
221,565
-
-
171,121
7
-
-
171,121
7
-
-
1,117,961
1,427,322
-
-
1,178,957
1,500,631
-
-
1
1
-
-
306
339
-
-
54
61
-
-
54
61
-
-
910
915
-
-
910
915
-
-
Investments in securities
Guarantees issued and
commitments to extended credit
six months ended
June
June
2014
2013
Interest and dividend income
Interest expenses
Fee income
Other income
Other expenses
26,184
(221)
25
2
(30)
25,323
(5,725)
24
94
(24)
six months ended
June
June
2014
2013
-
(166)
3
-
six months ended
June
June
2014
2013
26,706
(221)
25
2
(30)
25,482
(5,725)
24
94
(24)
six months ended
June
June
2014
2013
-
(171)
3
-
62
NLB d.d. discloses all transactions with the ultimate controlling party. For transactions with other governmentrelated entities, the NLB Group discloses individually significant transactions and the characteristics thereof.
in thousand EUR
NLB d.d.
Total amount of significant
transactions
1.1.-30.6.
1.1.-31.12.
2014
2013
Number of significant
transactions
1.1.-30.6.
1.1.-31.12.
2014
2013
Loans
451,527
581,359
4
7
Debt securities classified as loans and advances
717,822
702,791
2
2
Debt securities
51,127
51,800
1
1
Deposits
46,499
40,063
1
1
266,414
389,747
5
7
40,004
49,966
1
1
Borrowings
Commitments to extend credit
six months ended
June
June
2014
2013
Interest income from loans
Effects from net interest income and net valuation from debt securities
classified as loans and receivables
Interest income from debt securities
Interest expense from deposits
Interest expense from borrowings
Interest income from commitments to extend credit
2,161
1,778
17,811
(1,973)
857
854
-
(805)
(2,240)
(3,170)
120
-
63
in thousand EUR
NLB d.d.
Subsidiaries
Associates
Joint ventures
30.6.2014 31.12.2013
30.6.2014 31.12.2013
30.6.2014 31.12.2013
715,075
752,756
5,749
16,519
49,222
46,014
53,272
62,034
5,605
10,362
2,105
5,167
Investment in securities
-
-
503
490
-
-
-
-
580
569
-
-
566
5,177
499
7,573
-
30
12,390
-
-
228
556
322
456
3
215
3,606
3,691
242
992
40
53
16,191
40,318
2,095
2,002
8,476
3,725
1,295
2,000
900
900
-
-
Derivatives
Fair value
Contractual amount
Guarantees issued, commitments to
extended credit
Received loan commitments and financial
guarantees
Interest expenses
Fee income
Fee expenses
Other income
Other expenses
six months ended
June
June
six months ended
June
June
six months ended
June
June
2014
2014
2014
12,736
(94)
1,480
(55)
2,478
(2,166)
2013
17,101
(231)
965
(55)
166
(2,259)
214
(48)
150
(4,113)
1,601
(504)
2013
2,629
(304)
200
(3,855)
1,741
(347)
1,357
(21)
1,437
(620)
204
(60)
2013
1,088
(144)
1,138
(600)
256
-
64
in thousand EUR
NLB Group
Associates
Joint ventures
30.6.2014 31.12.2013
30.6.2014 31.12.2013
5,749
24,613
129,361
138,361
5,605
12,260
15,268
6,548
Investments in securities
503
490
-
-
580
569
-
-
-
30
12,390
-
-
322
456
4
220
242
992
1,803
53
2,095
2,002
27,432
14,867
900
900
-
-
Derivatives
Fair value
Contractual amount
Guarantees issued, commitments to
extended credit
Received loan commitments and financial
guarantees
Interest expenses
Fee income
Fee expenses
Other income
Other expenses
six months ended
June
June
six months ended
June
June
2014
2014
250
(48)
150
(4,113)
1,601
(504)
2013
2,629
(367)
200
(3,855)
1,741
(347)
3,833
(44)
1,490
(620)
204
(60)
2013
3,943
(163)
1,199
(600)
256
-
65
Key management compensation
in thousand EUR
Other Key management
personnel
six months ended
June
June
2014
2013
Management Board
six months ended
June
June
2014
2013
Short-term benefits
Costs refunds
Long-term bonuses:
Post employment benefits
Jubilee bonuses
TOTAL
367
4
248
3
2,524
73
3,142
86
_________
371
========
2
_________
253
========
4
1
_________
2,602
========
59
1
_________
3,288
========
Short-term benefits include:
- Monetary benefits (gross salaries, supplementary insurance, holiday bonus, other bonus); and
- Non-monetary benefits (company cars, health care, apartments, etc.).
The reimbursement of cost comprises food allowances and travel expenses.
Post-employment benefits include additional pension insurance and annuity savings.
7.2.
Analysis by segment
a) Segments
six months ended, June 30, 2014
in thousand EUR
NLB Group
Total net income
Net income from external customers
Intersegment net income
Net interest income
Net interest income from external customers
Intersegment net interest income
Reportable segment profit/(loss) before impairment and
provision charge
Share of profits of associates and joint ventures
Impairment and provisions charge
(Loss)/profit before income tax
Income tax
Profit for the period
30.6.2014
Reportable segment assets
Reportable segment liabilities
Corporate
banking in
Slovenia
Retail
banking in
Slovenia
Financial
markets in
Slovenia
Foreign
strategic
markets
Non-strategic
markets and
activities
Other
activities
Total
Unallocated
44,911
61,662
(16,751)
21,645
38,756
(17,111)
(25,876)
(3,366)
67,200
47,522
19,678
41,161
17,865
23,296
(40,987)
(6,536)
63,050
34,971
28,079
49,572
34,102
15,470
(9,543)
(1,122)
68,169
71,460
(3,291)
49,967
53,889
(3,922)
(39,181)
(4,109)
13,157
38,088
(24,931)
(62)
17,671
(17,733)
(15,036)
(2,274)
(2,808)
(2,808)
(4,147)
(841)
-
253,679
250,895
2,784
162,283
162,283
(134,770)
(18,248)
15,669
(49,212)
(33,543)
(33,543)
-
19,677
1,016
(6,774)
13,919
13,919
-
52,385
9,847
62,232
62,232
-
24,879
(16,400)
8,479
1,347
7,132
-
(4,153)
(2,941)
(7,094)
(7,094)
-
(7,796)
(492)
(8,288)
(8,288)
-
-
100,661
1,016
(65,972)
35,705
1,347
34,358
(344)
35,361
2,274,479
1,475,411
2,005,247
33,092
4,470,004
3,524,251
1,944,490
3,253,215
2,805,338
1,117,018
150,650
19,498
37,281
(344)
- 12,193,708
33,092
- 10,883,174
The methodology changed in 2013 as regards the display of medium and small enterprises and sole traders in the
NLB d.d.; the new display is within the segment Corporate banking in Slovenia and no longer within the segment
Retail Banking in Slovenia. In addition, the changed methodology of internal transfer prices was implemented in
NLB d.d., which had an impact to the result of NLB d.d. segments. The segmental analysis of NLB Group for the
first half year 2013 is adapted to both changes.
66
six months ended, June 30, 2013
in thousand EUR
NLB Group
Total net income
Net income from external customers
Intersegment net income
Net interest income
Net interest income from external customers
Intersegment net interest income
Reportable segment profit/(loss) before impairment and
provision charge
Share of profits/(losses) of associates and joint ventures
Impairment and provisions charge
(Loss)/profit before income tax
Income tax
Loss for the period
31.12.2013
Reportable segment assets
Reportable segment liabilities
Additions to non-current assets
Corporate
banking in
Slovenia
Retail
banking in
Slovenia
Financial
markets in
Slovenia
Foreign
strategic
markets
Non-strategic
markets and
activities
Other
activities
Total
Unallocated
41,692
73,635
(31,943)
18,766
50,707
(31,941)
(21,859)
(2,790)
64,220
31,366
32,854
34,513
865
33,648
(52,732)
(8,485)
34,608
1,396
33,212
28,613
(4,649)
33,262
(9,706)
(1,122)
69,715
73,604
(3,889)
50,049
54,147
(4,098)
(38,748)
(6,952)
(5,541)
21,792
(27,333)
1,764
32,548
(30,784)
(18,432)
(2,906)
(2,437)
(2,350)
(87)
(93)
(6)
(87)
(839)
(180)
-
202,257
199,443
2,814
133,612
133,612
(142,316)
(22,435)
17,043
(76,250)
(59,207)
(59,207)
-
3,003
1,782
(9,109)
(4,324)
(4,324)
-
23,780
(408)
23,372
23,372
-
24,016
(22,316)
1,700
1,139
561
-
(26,880)
(4,168)
(36,941)
(67,989)
(1)
(67,988)
-
(3,456)
7
(3,449)
(3,449)
-
-
37,506
(2,386)
(145,017)
(109,897)
1,138
(111,035)
19,859
(90,038)
2,410,963
1,087,466
2,969
2,018,580
28,284
4,566,571
9,764
3,554,144
2,575,176
655
3,265,290
2,800,601
9,617
1,184,788
146,461
7,314
28,085
42,862
-
19,859
- 12,461,850
28,284
- 11,219,137
30,319
b) Geographical information
in thousand EUR
NLB Group
Revenues
six months ended
June
June
2014
2013
Net income
six months ended
June
June
2014
2013
Non-current assets
30.6.2014
31.12.2013
Total assets
30.6.2014
31.12.2013
Slovenia
South East Europe
Macedonia
Serbia
Montenegro
Croatia
Bosnia and Herzegovina
Bulgaria
Kosovo
Western Europe
Germany
Switzerland
Czech Republic
231,483
115,922
37,890
12,086
15,806
771
33,769
15,600
284
13
271
_________-
260,087
119,898
36,219
12,907
22,173
887
32,346
1
15,365
3,442
117
3,325
323
_________
175,956
74,123
24,540
7,266
8,551
976
23,306
(10)
9,494
761
31
730
55
_________
130,058
76,838
22,605
8,170
14,315
1,356
21,607
8,785
2,907
44
2,863
(10,360)
_________
228,908
121,901
35,090
30,982
11,297
2,848
27,096
1
14,587
373
312
61
_________-
232,319
123,679
35,300
32,214
11,841
3,611
27,764
1
12,948
435
330
105
_________-
8,752,757
3,357,384
971,668
367,396
500,924
42,343
1,018,920
356
455,777
109,672
4,481
105,191
6,987
_________
8,987,307
3,378,985
962,598
387,321
498,806
47,461
1,016,479
897
465,423
116,708
6,398
110,310
7,134
_________
TOTAL
347,689
========
383,750
========
250,895
========
199,443
========
351,182
========
356,433
========
12,226,800
========
12,490,134
========
Geographical analysis includes a breakdown by geographical segments with respect to the country in which
individual NLB Group entities are located.
67
7.3.
Subsidiaries
The NLB Group’s subsidiaries as at June 30, 2014 are:
Nature of
Business
Country of Incorporation
Finance
Republic of Germany
Trade
Republic of Croatia
NLB Tutunska Banka a.d., Skopje
Banking
Republic of Macedonia
NLB Montenegrobanka a.d., Podgorica
Banking
Republic of Montenegro
NLB banka a.d., Beograd
Banking
Finance
NLB Banka d.d., Tuzla
Banking
NLB Razvojna banka a.d., Banja Luka
NLB’s
NLB Group’s
shareholding shareholding
%
%
100
100
-
100
86.97
86.97
98
98
Republic of Serbia
100
100
Republic of Serbia
-
100
Republic of Bosnia and
Herzegovina
96.30
96.30
Banking
Herzegovina
99.85
99.85
NLB Prishtina sh.a., Priština
Banking
Republic of Kosovo
81.21
81.21
NLB Leasing d.o.o., Ljubljana
Finance
Republic of Slovenia
100
100
Finance
Finance
Property
Republic of Bulgaria
Republic of Croatia
Republic of Croatia
-
100
99.97
100
NLB Leasing Podgorica d.o.o., Podgorica
Finance
100
100
NLB Leasing d.o.o., Beograd
Finance
Republic of Serbia
100
100
NLB Leasing d.o.o., Sarajevo
Finance
Herzegovina
100
100
NLB Lizing d.o.o.e.l., Skopje
Finance
100
100
NLB InterFinanz AG, Zürich
100
100
-
100
100
LHB AG, Frankfurt
LHB Trade d.o.o. - v likvidaciji, Zagreb
Convest a.d., Novi Sad
NLB Leasing Sofija E.o.o.d., Sofija
Optima Leasing d.o.o., Zagreb
OL Nekretnine d.o.o., Zagreb
Finance
Sw itzerland
NLB InterFinanz Praha s.r.o., Praga
NLB InterFinanz d.o.o., Beograd
Finance
Finance
Czech Republic
Republic of Serbia
NLB Factoring a.s. - "v likvidaci", Ostrava
Finance
Czech Republic
100
100
NLB Skladi d.o.o., Ljubljana
Finance
100
100
Plan d.o.o., Banja Luka
Architecture
services
Herzegovina
39.14
88.14
NLB Nov penziski fond a.d., Skopje
Insurance
51
100
NLB Crna gora d.o.o., Podgorica
Property
100
100
FIN-DO d.o.o., Dom žale
Property
100
100
NLB Propria d.o.o., Ljubljana
Property
100
100
NLB Srbija d.o.o., Beograd
Property
Republic of Serbia
100
100
CBS Invest d.o.o., Sarajevo
Property
Herzegovina
100
100
Prospera plus d.o.o., Ljubljana
Tourist and
catering trade
100
100
68
The NLB Group’s subsidiaries as at December 31, 2013 are:
Nature of
Business
Country of Incorporation
Finance
Republic of Germany
Trade
Republic of Croatia
NLB Tutunska Banka a.d., Skopje
Banking
NLB Montenegrobanka a.d., Podgorica
NLB banka a.d., Beograd
NLB’s
NLB Group’s
shareholding shareholding
%
%
100
100
-
100
86.97
86.97
Banking
97.40
97.40
Banking
Republic of Serbia
100
100
Trade
Finance
Republic of Serbia
Republic of Serbia
-
94.85
100
NLB Banka d.d., Tuzla
Banking
Herzegovina
96.30
96.30
NLB Razvojna banka a.d., Banja Luka
Banking
Herzegovina
99.85
99.85
NLB Prishtina sh.a., Priština
Banking
Republic of Kosovo
81.21
81.21
NLB Leasing d.o.o., Ljubljana
Finance
100
100
Finance
Finance
Real estate
Republic of Bulgaria
Republic of Croatia
Republic of Croatia
-
100
99.97
100
NLB Leasing Podgorica d.o.o., Podgorica
Finance
100
100
NLB Leasing d.o.o., Beograd
Finance
Republic of Serbia
100
100
NLB Leasing d.o.o., Sarajevo
Finance
Herzegovina
100
100
NLB Lizing d.o.o.e.l., Skopje
Finance
100
100
NLB InterFinanz AG, Zürich
Finance
Sw itzerland
100
100
Finance
Finance
Czech Republic
Republic of Serbia
-
100
100
NLB Factoring a.s. - "v likvidaci", Ostrava
Finance
Czech Republic
100
100
NLB Skladi d.o.o., Ljubljana
Finance
100
100
Plan d.o.o., Banja Luka
Architecture
services
Herzegovina
39.14
88.14
NLB Nov penziski fond a.d., Skopje
Insurance
51
100
NLB Crna gora d.o.o., Podgorica
Real estate
100
100
FIN-DO d.o.o., Dom žale
Real estate
100
100
NLB Propria d.o.o., Ljubljana
Real estate
100
100
NLB Srbija d.o.o., Beograd
Real estate
Republic of Serbia
100
100
CBS Invest d.o.o., Sarajevo
Real estate
Herzegovina
100
100
LHB AG, Frankfurt
LHB Trade d.o.o. - v likvidaciji, Zagreb
Conet d.o.o. - v stečaju, Beograd
Convest d.o.o., Novi Sad
NLB Leasing Sofija E.o.o.d., Sofija
Optima Leasing d.o.o., Zagreb
OL Nekretnine d.o.o., Zagreb
NLB InterFinanz Praha s.r.o., Praga
NLB InterFinanz d.o.o., Beograd
*Ownership interest is calculated after the deduction of treasury shares.
69

Untitled

Transcription

Similar documents

Clonefish A through K

May 2013 - National Library Board

EQUITY - RBFCU

Go Library September 2016

EcoTouch® QUIETZONE® PINK® FIBERGLAS® Acoustic Insulation

Registration Form COFRET ` 10

June 2013 - National Library Board

Go Library September 2015