Increasing
clients’ wealth sustainably
as our mission
EVLI BANK PLC | ANNUAL REPORT 2020
BUSINESS OVERVIEW
Evli in brief ................................................................... 3
CEO’s review ............................................................... 5
Highlights of 2020 ....................................................... 7
Business model ........................................................... 9
Megatrends and strategy ......................................... 10
RESPONSIBILITY
Responsibility at the core of Evli’s strategy ............ 15
Responsible products and services ......................... 18
Responsible governance .......................................... 23
Responsible employer .............................................. 27
Reporting practices .................................................. 32
GRI content index ..................................................... 34
Annex: Task Force on Climate-related
Financial Disclosures ................................................ 38
FINANCIAL REVIEW
Key financial figures .................................................. 43
Graphs of the financial development ..................... 44
Board of Director´s report ........................................ 45
Shares and shareholders .......................................... 52
Information for shareholders and investors ............ 55
Capital adequacy ...................................................... 56
Calculation of key ratios ........................................... 57
Financial statement 1.1.-31.12.2020 ........................ 58
Board of Directors’ proposal to the General
Meeting for profit distribution ............................... 125
Auditor’s report ....................................................... 126
GOVERNANCE
Corporate governance statement ......................... 131
Remuneration policy .............................................. 140
Remuneration report .............................................. 143
Board of Directors .................................................. 145
Executive Group ..................................................... 146
Contents
GOVERNANCE
FINANCIAL REVIEW
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BUSINESS OVERVIEW
A bank specialising
in investments
EVLI IN BRIEF
Evli is a bank specialised in investments that help institutions, corporations,
and private persons increase their wealth. Evli offers a wide range of
investment and asset management services through the following business
areas: Wealth Management and Investor Clients, and Advisory and
Corporate Clients. The business areas are supported by Group operations.
The Wealth Management and Investor Clients segment offers asset
management services, fund products, alternative investment products
and various capital market services. The Advisory and Corporate Clients
segment provides advisory services related to M&A transactions,
incentive program design and administration services and investment
research for listed companies. In addition, Evli offers banking services
that support the investment activities. Due to the comprehensive service
offering, Evli is able to offer its clients product and service solutions that
meet their various needs.
Finland accounts for the largest share of the company’s revenue, while the
other Nordic and European countries also are important market areas.
Read more: www.evli.com
1985
Founded in
Listed on the Nasdaq
Helsinki main list since
15
Sales in
countries through its own offices
and co-operation partners
Personnel
261
2015
14.1
Assets Under
Management EUR
billion
Finland’s
4.
largest fund
management company
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Sales through Evli Sales through co-operation partners
Evli’s operations
are divided into
two client segments
Wealth Management and Investor Clients
• Product and service offering
- Private Banking and Evli Digital wealth management services
- Institutional Asset Management
- Public and private market funds
- Capital Market services
• Finland’s 4th largest Fund Management Company.
Market share 6.6%
• Employs 160 investment specialists in Finland and Sweden
• Multiple times awarded among the best and most used institutional
asset managers in Finland
1)
• Best Finnish Private Bank.
2)
Advisory and Corporate Clients
• Product and service offering
- Corporate Finance: Financial advisor in financial
arrangements for listed and unlisted companies
- Evli Alexander Incentives: Incentive plan design and
administration for listed and unlisted companies
- Evli Research Partners: Research services to small and
mid-sized listed companies
• Employs 53 investment specialists in Finland and Sweden.
1)
KANTAR SIFO Prospera External Asset Management Finland 2015, 2016, 2017, 2018, 2019, 2020 and SFR Institutional Asset Management 2015, 2016, 2017, 2018, 2019 -surveys.
2)
KANTAR SIFO Prospera Private Banking 2019 and 2020 Finland -surveys.
Market-specific positioning
reflects Evli’s competitive
advantage
Finland and Sweden
Comprehensive Wealth Management and Investment
Banking services.
Internationally
Nordic fund management boutique for institutional investors.
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CEO’S REVIEW
Evli achieved a record result in an
exceptional market environment
The capital market’s development in 2020 was marked by the coronavirus
pandemic, which brought on a roller coaster of volatility. After a positive start to the
year, the pandemic derailed the market in March and rapidly weakened the earning
potential of firms providing investment services. During the spring and summer,
the markets quickly recovered, and equity prices were particularly strong. In these
extreme exceptional circumstances, Evli managed to adapt its operations as the
situation required and achieved a good earnings development.
After the pandemic caused a sharp fall in equity prices in March,
the equity market recovered surprisingly fast in the spring. The
positive market sentiment was reinforced by both broad go-
vernment support packages and the central banks’ commit-
ment to long-term stimulative monetary policies, as well as the
reduction in coronavirus infections and the expectations of a
rapid introduction and rollout of vaccines. Towards the end
of the year, the prices of many equities already exceeded the
pre-pandemic level, and a large amount of capital was also
directed to small and even unlisted companies.
To ensure that our operations could run smoothly without inter-
ruption, we at switched to a decentralised working model as
soon as the pandemic started and very quickly to full-time
remote working. Due to the extensive investments we’ve made
to our IT systems in recent years and our employees’ ability to
rapidly adapt to the situation, we were able to carry out all of
our operations efficiently and be in active contact with our cli-
ents even in this challenging situation.
With the fall in equities prices at the start of the year, our cli-
ents’ assets under management clearly decreased during the
first half of the year. For our international fund sales, which had
risen sharply in the past few years, the pandemic-related restric-
tions were particularly challenging. However, at the end of the
year, our client assets under management were almost at the
previous years level, at EUR 14.1 billion. Our full-year net com-
mission income increased from the previous year, amounting to
EUR 76.8 million (EUR 72.2 million). Overall, the Group’s ope-
rating income increased to EUR 79.7 million (EUR 75.8 million).
The Group’s operating profit increased by up to 21 percent to
EUR 29.1 million (EUR 24.1 million). I believe this is an excel-
lent achievement, given the very challenging market condition.
For Evli Awards Management Oy, one of our group companies,
a significant event was the exchange of shares carried out in the
autumn, in which Evli Awards Management Oy and Alexander
Incentives Oy were merged to become Evli Alexander Incen-
tives Oy. The new company will serve our clients throughout
the entire value chain of incentive programs, from planning to
management and implementation.
Responsibility as a strategic priority
Responsibility has already been an important part of both our
portfolio management and our internal operations for years,
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BUSINESS OVERVIEW
and our clients’ interest in the responsibility of investment tar-
gets continues to grow. To further emphasise the importance of
responsibility in our operations, we raised it to one of our stra-
tegic priorities at the beginning of the year.
For us, it’s important that responsibility isn’t just a noble prin-
ciple in our operations, but rather it needs to materialise con-
cretely through actions. During the year, we published renewed
ESG reports for our funds, updated our responsible investment
principles, as well as our climate and corporate governance
principles, and expanded the criteria by which our equity and
fixed-income funds exclude companies offering controversial
products or services from the point of view of responsibility.
During the year, we also launched new funds which featured
responsibility as a key criterion in the selection of investment
targets. Evli Green Corporate Bond is our first fund to invest
in the green bond market through corporate bonds. The pro-
ceeds from each bond are to be used for projects that genuinely
improve the climate. At the end of the year, we launched Evli
Impact Forest Fund I, which invests in globally unlisted forest
funds, thereby seeking to mitigate climate change through pos-
itive carbon effects. The fund’s carbon footprint is monitored
and reported to investors on a regular basis.
We have received several positive reviews from third parties,
which speak to the success we’ve had in our responsibility work.
These also encourage us to further develop the responsibility
of our operations comprehensively and with great ambition.
Alternative investment products and index funds
continue to grow in popularity
In a low-interest-rate environment that will continue well into
the future, and with equity prices also at historically high le-
vels, the weight of alternative investment products in invest-
ment portfolios will increase as investors seek returns on their
investments. Instead of a traditional allocation consisting only of
listed equities and fixed-income securities, the portfolios of pro-
fessional investors increasingly include real estate assets, which
provide inflation protection and cash flow, as well as the high-
er-yielding but illiquid private equity investments. We’re seeing
this development in all developed capital markets.
Alternative investment products are one of Evli’s strategic
growth areas. They enable us to improve the return potential of
our clients’ portfolios and expand their diversification. In recent
years, we have systematically increased our expertise in alter-
native investment products and developed a new allocation
model that allows for an even broader diversification of invest-
ments into different types of income sources. This model, which
is individually tailored from the client’s point of view, offers a
return expectation that is a couple of percentage points higher
than a traditional allocation for the same level of risk. Alterna-
tive investment products have become a significant asset class
in the portfolios of many of our clients.
In light of the market situation and our more comprehensive
approach, our sales of alternative investment products deve-
loped well in 2020. At the end of the year, over EUR 1 billion
had already been invested in these products and their share of
our commission income neared 25 percent.
Another trend in the investment market that remained strong
in 2020 was the growing popularity of passive index funds. In
ten years, USD 3 trillion has already been channelled globally
into low-fee passive funds, mainly due to the inability of actively
managed equity funds to create sufficient added value after tak-
ing their expenses into account.
As these trends intensify in the coming years, the capital allo-
cated to traditional actively managed investments will continue
to shrink and fee levels will decline. This development requires
investment firms to be able to radically overhaul their services
while adjusting their cost levels, which is very likely to lead to
further consolidation in our industry.
Every cloud has a silver lining
The past year was very difficult for all of us on many levels.
Despite this, the pandemic also had positive consequences for
Evli, as it did for many other organisations.
Our employees adapted so well to the work patterns required
by the emergency that, based on the results of our internal sur-
vey, we launched plans to increase the opportunities to work
remotely, even under normal conditions. We have now intro-
duced a so-called flex working model on a permanent basis, in
which employees can choose, within certain limits, whether to
work at the office or from home. In our office, many places no
longer consist of personal workstations, but rather all systems
work regardless of where the work is done. For us, this will mean
a dramatic reduction in the need for business premises and so
the annual costs for premises can be lowered.
I warmly thank our clients and shareholders for their continued
cooperation and our employees for their flexibility and excellent
contributions during this extremely exceptional year.
Maunu Lehtimäki
CEO
For us, it’s important that
responsibility isn’t just a noble
principle in our operations, but
rather it needs to materialise
concretely through actions.
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4.
Finland’s
largest fund
management
company
14.1
Client assets under
management EUR
billion
01/2020
Responsibility as a strategic focus area
Evli seeks to invest even more in
responsibility, which is why Evli has decided
to make responsibility one of its strategic
focus areas for the coming years. Although
responsibility has been an integral part of
Evli’s portfolio management for many years,
this decision aims to further emphasise its
importance.
Read more: www.evli.com
02/2020
New global infrastructure fund
In February, Evli launched a new private
equity fund, Evli Infrastructure I. The fund
invests globally in infrastructure projects,
which include, e.g. water and gas companies,
social infrastructure serving society,
telecommunications companies, roads and
ports, energy production and distribution
companies, and renewable energy.
Read more: www.evli.com
03/2020
Best fund management
company in Sweden
Morningstar chose Evli Fund Management
Company as the best fund management
company in Sweden. In the “Best Fund House:
Overall” category, the rankings are determined
based on five-year risk-adjusted returns, taking
into account all of the funds registered in the
country by the fund management company.
Read more: www.evli.com
Responsibility at the core of
all operations
HIGHLIGHTS OF 2020
06/2020
Ten years as a signatory of the UN
Principles for Responsible Investment
Evli celebrated its tenth year as a signatory of
the United Nations Principles for Responsible
Investment (UN PRI). Evli signed the principles
in June 2010 and has since then committed to
implementing the UN PRI’s six principles and
has annually reported to the organisation on the
responsibility of its investments.
Read more: www.evli.com
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ANNUAL REPORT 2020EVLI BANK PLC
1.1
Investment assets
in alternative investment
funds EUR
billion
09/2020
Evli expanded its fund distribution to
the Netherlands
In September, Evli Fund Management
Company signed a co-operation
agreement with The Cardinal Partners
Global for the selling of Evli funds to
institutional investors in the Netherlands.
Read more: www.evli.com
08/2020
Evli’s first green corporate bond fund
In August, Evli launched a new investment
fund focusing on green corporate bonds, Evli
Green Corporate Bond. The fund invests in
the green bond market through corporate
bonds.
Read more: www.evli.com
10/2020
Evli’s fund sales expanded to Austria
In October, Evli Fund Management
Company signed a co-operation
agreement with Absolute Return
Consulting (ARC) for the offering of Evli
funds to institutional investors in Austria.
Read more: www.evli.com
11/2020
New forest fund further expanded
Evli’s product offering
In November, Evli launched a new global
forest fund, Evli Impact Forest Fund I. The
fund invests in globally leading, unlisted
forest funds that manage and develop
forest assets.
Read more: www.evli.com
08/2020
Responsible investing achieved
the highest international
responsibility rating
In an international comparison, the UN’s
umbrella organisation for responsible
investment, the PRI, awarded Evli the
best rating (A+) in the strategy and
governance category. The score obtained
from this category is often considered an
assessment of the overall approach.
Read more: www.evli.com
07/2020
The most used institutional asset
manager in Finland for the fourth
year in a row
For the fourth year in a row, Evli was the
most used institutional asset manager in
Finland in the KANTAR SIFO Prospera
“External Asset Management 2020
Finland” -survey. A total of 62 percent
of the participated institutions use Evli’s
asset management services.
Read more: www.evli.com
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Business ProcessesBusiness Areas
Added value and impacts
Resources
Strategy
More information on pages 10-13.
Values
Entrepreneurship, valuable relationships,
learning, integrity
Clients
• Products and services that correspond
to clients’ needs and goals
• Opportunity to tailor service solutions
• Professional and competent service
• Responsible investments.
Personnel
• 261 investment specialists
• Salary and bonuses EUR 24.6 million
• Pension expenses EUR 3.4 million
• Personnel training EUR 0.1 million.
Owners and investors
• Dividend proposal EUR 0.73/share
• Equity/share EUR 3.86
• Stable development
• Responsible investment.
Society
• Investments EUR 0.9 million
• Paid taxes EUR 6.3 million
• Collaboration, support and sponsorship
with universities, entrepreneurs as well as
sports and culture.
Wealth Management and Investor Clients
Wealth management services, mutual funds, various
capital market services and alternative investment
products to private persons, corporations and
institutions.
Advisory and Corporate Clients
Corporate advisory services, incentive plan design
and administration as well as investment research
for companies of different sizes.
Self-developed
products and services
Perseverance and
goal orientation
Comprehensive support functions and controls
including IT, financial administration, back-office,
marketing & communication, law and compliance
Individual service
combining traditional
and digital service
models and channels
Stewardship thinking
and responsible
operations
Personnel
• 261 investment specialists
Offices and distribution network
• 3 offices;
Helsinki, Turku and Stockholm
• 7 tied agents
• Distribution through partners and own
offices in 15 countries.
Intangible assets
• Products and services
• Brand
• Client relationships
• Social network:
partners, distribution network
and community relations.
Financial resources
• Balance sheet EUR 772.6 million
• Equity EUR 95.4 million
• Assets under Management
EUR 14.1 billion
• Net revenue EUR 79.7 million.
Processes
• Product development
• Sales processes
• Utilization of automation,
artificial intelligence and robotization
• Personnel management.
Institutions and
private persons
Corporations
Added value with stable earnings development
BUSINESS MODEL
Mission
Increasing clients’ wealth
sustainably according to their
individual targets.
Vision
Clients perceive Evli Simply
Unique by offering high
quality services and unique
customer experience 24/7.
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Strategy - preserve
and grow clients´ wealth
sustainably
MEGATRENDS AND STRATEGY
Megatrends create opportunities for Evli
The financial sector is in the midst of an enormous transforma-
tion, driven foremost by globalisation, digitalisation, increased
regulation, societal developments and responsibility.
Regulatory and reporting requirements in the financial indus-
try have increased greatly over the past decade, and this trend
still continues. Tighter regulation improves consumer protec-
tion and makes the service providers’ operating models more
transparent to clients. At the same time, meeting the require-
ments of tightening regulation requires service providers to
develop their information systems and educate the personnel.
The development of information systems and digital services
enables the provision of services to a wider target group and
in a wider geographical area. Digitalisation has also increased
competition across sectorial boundaries. Clients can be served
in more cost-effective and personalised ways, and increasingly
by the use of artificial intelligence and robotics. Clients want to
Evli’s ability to integrate
responsibility into its entire
business is essential for
creating added value.
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invest regardless of time and place, and they demand smoother
and more personalised service solutions that seamlessly inte-
grate the ease and speed of technology and the individuality
brought by personal service.
At the same time, the financial sector is challenged in devel-
oped markets by an ageing population and their limited ability
to take advantage of digital services. Securing the standard of
living and well-being at retirement is of interest to an ever-in-
creasing client segment. These clients need and require invest-
ment services that take individual preferences into account in
order to achieve this.
Because megatrends increase the demands of society, custom-
ers, and the environment for sustainable development, service
providers need to develop responsible product and service
solutions. In the financial industry, clients increasingly demand
that responsibility is taken into account in investment opera-
tions and seek investment and asset management solutions
that integrate environmental, social and corporate governance
issues (ESG).
Evli’s goal is to be a growing and profitable bank specialised in
investments, consolidating its position as a leading asset man-
ager in Finland and engaging in international expansion. The
cornerstones of growth are the creation of unique customer
experiences, the development of new products and services,
as well as the utilisation of digitalisation and the integration of
responsibility in day-to-day operations.
Creating unique customer experience
Evli’s Vision is to be perceived by clients as Simply Unique by
offering high-quality services and a unique customer experi-
ence 24/7. The aim of the development of product and service
concepts is to offer clients more flexible products and services
that take responsibility as well as individual needs and require-
ments into account. The key products and services consist of
innovative institutional-level products and services and a sound
corporate culture which is based on Evli’s values: entrepreneur-
ship, valuable relationships, integrity and learning. These values
and Evli’s Ethical Code of Conduct serve as the guiding princi-
ples in the management of client relationships.
International growth with carefully selected
fund products
Evli has successfully established itself as a leading asset man-
ager among Finnish affluent private individuals and institutions
and one of the biggest fund houses in the country. The aim is
to further strengthen its position as a leading asset manager.
However, given its substantial share of the domestic market and
the small size of the market, international growth is a natural
objective for Evli. Evli is excellently placed where international
sales are concerned, and the image of a high-quality Nordic
fund management boutique is of interest to foreign investors.
Particularly in Central Europe, Evli benefits from the image of
reliability and transparency that is associated with the Nordic
countries. Compared with large international fund houses, Evli’s
relatively smaller size enables agility and more personalised ser-
vice. Evli leverages its competitive advantage by focusing on
increasing the international sales of selected funds to institu-
tional investors through carefully selected partners.
Alternative investment products at the heart of
product development
In addition to international growth, an important strategic pri-
ority is the expansion of the product and service offering to pri-
vate individuals and institutions. The cornerstone of expanding
the product and service portfolio is the continued development
of alternative investment products. Evli offers Finnish investors,
and in the future also international clients, several alternative
investment products. The aim is to turn the asset class into a
considerable source of revenue.
In addition, Evli is constantly further developing the service
concept to corporations based on the creation of a unique sys-
tem geared to increasing shareholder value. Companies are
offered both corporate advice and services related to M&A
activity, as well as incentive plan design and management and
corporate analyses. The aim is to increase the sales of these
services in Finland and Sweden.
Responsibility at the core of all business operations
Evli raised responsibility to one of its strategic focus areas in
early 2020, but responsibility has been a part of Evli’s invest-
ment activities for a long time. Evli’s ability to integrate respon-
sibility into its entire business is essential for creating added
value. Responsibility factors have been integrated into invest-
ment operations in Evli’s most significant business area, Wealth
Management, which means that responsible investment is a sys-
tematic part of portfolio management. Investments made by
Evli’s mutual funds are also monitored for possible norm viola-
tions, and Wealth Management engages with companies inde-
pendently and together with other investors. Evli is constantly
looking for new ways to further improve the responsibility of
its products and services. More about Evli’s responsibility and
responsible investing is found on pages 14-41.
Added value through digitalisation
Evli’s business environment is increasingly becoming digital,
and as part of this change, clients are increasingly seeking di-
gital investment service solutions. Process automation, software
robotics and artificial intelligence have an increasingly impor-
tant role in the daily activities of the investment services indus-
try. They also have a direct impact on the client experience in
the form of the smooth performance of the services.
To maintain its competitiveness, Evli invests strongly in the
development of digital services alongside traditional service
models. In addition, Evli invests in the automation of its prac-
tices, since improving efficiency is critical for the company’s suc-
cess in a digitalised business environment.
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Increasing clients’ wealth
sustainably
Net Fee IncomeReturn on Equity
Assets under ManagementRecurring Revenue to Operational Costs
Digitalization
Artificial Intelligence
Robotization
Big data
Cyber risks
Globalization
Increased competition
Empowerment of customer
Blurring industry boundaries
Business
environment
Consolidation
Increased regulation and control
Societal
transitions
Aging of the population
Digital natives
Responsibility
Ethical business
Sustainability
Transparency
Climate change
Responsibility
Responsible products
and services
Positive influence on society
and the environment
Digitalization
New digital investment solutions
and service models
Utilization of process automation,
software robotics and artificial intelligence
Offering
Alternative investment products
to private clients and institutions
Development of the integrated corporate
service model to corporate clients
Clients
Increasing the client base
in Finland and internationally
Perceived as ”Simply Unique”
by clients
MEGATRENDS
STRATEGY FOCUS AREAS
GROWTH TARGETS
LEADING NORDIC WEALTH MANAGER
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Cornerstones of the strategy
Clients
• Increasing the client base in Finland and internationally
• Perceived as ”Simply Unique” by clients.
Offering
• Alternative investment products to private clients
and institutions
• Development of the integrated corporate service model
to corporate clients.
Responsibility
• Responsible products and services
• Positive influence on society and the environment.
Digitalisation
• New digital investment solutions and service models
• Utilisation of process automation, software robotics
and artificial intelligence.
2020 Outcomes
Clients
• Fund net subscriptions of EUR -1.1 billion
(2019: EUR 0.9 billion)
• Total Assets under Management of EUR 14.1 billion
(2019: EUR 14.3 billion)
• Two new co-operation countries (Austria and the Netherlands)
• Finland’s most widely used institutional asset manager
1)
and
Finland’s best Private Banking -services
2)
.
Offering
• Assets under management in alternative investment products
EUR 1.1 billion (2019: EUR 0.9 billion)
• New alternative investment funds: Evli Infrastructure Fund I Ky
and Evli Impact Forest Fund I
• New mutual funds: Evli Green Corporate Bond and Evli Equity
Factor Global.
• Expansion of the incentive plan management to also
include the design of incentive plans.
Responsibility
• New ESG reports for mutual funds
• New sustainability funds (for example Evli Green Corporate
Bond and Evli Equity Factor Global funds)
• Systematic engaging with companies independently and
together with other investors
• Business operations developed favourably and dividend
increased by 8%.
Digitalisation
• Launch of the new My Evli online service
• Adopting a comprehensive remote working model
• Outsourcing of custody of Evli’s funds
to Svenska Enskilda Banken (SEB).
Clients
• Deepen the presence in current markets and expand
to new markets through co-operation partners
• Expand the client base
• The best and most used asset manager in Finland.
Offering
• Expand the product offering by introducing 2-3 new alternative
investment funds
• Launch 1-2 new traditional mutual funds.
Responsibility
• Deepen ESG integration in portfolio management
• Launch new responsibility and impact funds
• Set climate targets
• Further improving the diversity of personnel
• Increasing transparency in investor communications.
Digitalisation
• Further development of the My Evli online service and launching
the new Evli Mobile
• Development of internal processes
• New operating model for fund publications
• Process developments to support the strategic focus areas.
Targets 2021
Strategy in action
1)
KANTAR SIFO Prospera External Asset Management Finland 2015, 2016, 2017, 2018, 2019, 2020 -surveys
2)
KANTAR SIFO Prospera Private Banking 2019 ja 2020 Finland -surveys
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Responsibility
Responsibility has been an integral part of Evli’s
business for many years. In 2020, Evli raised
responsibility to one of its strategic focus areas
and developed its procedures even more actively.
During the year, Evli published, among others,
renewed fund ESG reports, as well as updated
the principles of responsible investing and the
principles for climate change and ownership
control, in addition to expanding the exclusion
criteria. The safe and functioning work conditions
both remotely and at the office also became more
important due to the coronavirus pandemic.
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Responsibility at the core
of Evli’s strategy
RESPONSIBILITY
Responsibility built on Evli’s values and
transparency
Evli’s business is based on understanding its
clients’ needs. The company’s primary respon-
sibility is to increase its clients’ wealth respon-
sibly based on the clients’ individual goals.
Evli’s client relationships are long and based
on mutual trust and doing business that is ethi-
cally sustainable. Evli’s business opportunities
and the development of its operations depend
not only on its clients’ trust, but also the trust
of its employees, owners, investors, co-ope-
ration partners and society. To maintain and
strengthen this trust, Evli must be proactive,
transparent, highly ethical and responsible in
all of its operations. Responsibility is based on
Evli’s values: entrepreneurship, valuable rela-
tionships, integrity and continuous learning.
These values also form the foundation for the
ethical principles which direct the actions of
Evli and its employees and which guide the
company’s relationship with its clients and
other stakeholders.
Evli seeks to be a responsible member of soci-
ety and is committed to taking into account
both the direct and indirect environmental
impacts of its operations. Because corporate
responsibility is part of Evli’s everyday business
operations, its annual report includes a corpo-
rate responsibility report. The responsibility
section includes detailed information on how
responsibility has been integrated into busi-
ness operations and what indicators have been
deemed essential for measuring Evli’s respon-
sibility.
Responsibility report based on
stakeholders’ expectations
(GRI 102-46: Entities included in the conso lidated finan-
cial statements, GRI 102-47: List of material topics, GRI
103-1 Explanation of the material topic and its boundary)
At Evli, responsibility means financial, social
and environmental responsibility in a broad
sense. In 2018, Evli conducted its first mate-
riality analysis in order for the responsibility
report and future priorities to correspond to
the expectations of stakeholders and focus on
matters that are relevant to the company. In
2020, the material topics were reassessed to
ensure that these remain relevant and prop-
erly grouped. On the basis of the re-evalua-
tion, the material topics remained unchanged,
Responsible business supports the company’s value creation
Responsible products
and services
• Responsible marketing
• Customer privacy protection
and data security
• Responsible investing
Responsible employer
• Fairness: equality,
non-discrimination and diversity
• Work well-being and health
• Education and development
• Attractive employer
Responsible governance
• Profit performance
• Taxes and tax footprint
• Corruption, bribes and
money laundering
• Direct environmental impacts
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RESPONSIBILITY
FOKUS AREAS
Prioritized areas of responsibility work at Evli. These have
been identified as important to ensure Evli’s future
competitiveness and create added value for its stakeholders
in the long term.
• Responsible marketing
• Work well-being and health
• Education and development
• Direct environmental impacts
Issues relevant to Evli and its stakeholders that enable more
responsible business operations. Determined in part by laws
and regulations. However, Evli itself determines how much it
develops these areas of responsibility in order to be a more
responsible company and to meet stakeholder expectations
now and in the future.
• Customer privacy protection
and data security
• Taxes and tax footprint
• Corruption, bribes and money
laundering
Areas that are fundamental to trust in the banking industry
and are directly related to stakeholder confidence in Evli and
its business. These are always handled in accordance with
current legislation and regulatory requirements.
but the grouping was changed by dividing the material topics
into three main groups: base, development areas, and focus
areas, which cover eleven material topics.
The materiality analysis considers the importance of the issues
raised to stakeholders and Evli’s business. The three main groups
take into account Evli’s ability to develop these areas in order to
create even more responsible business operations. The base of
the grouping are topics that create the foundation for banking
operations and are directly related to stakeholders’ trust in Evli
and its business. At the middle of the grouping are the deve-
lopment areas, which are relevant to Evli and its stakeholders,
enabling more responsible business, and are partly determined
by laws and regulations. At the top of the grouping are the focus
areas of Evli’s responsibility work. These are the topics that Evli
has identified as significant to ensure its future competitiveness
and create added value for its stakeholders in the long term.
• Responsible investing
• Profit performance
• Fairness: equality,
non-discrimination and diversity
• Attractive employer
DEVELOPMENT AREAS
BASE
As a result of the materiality analysis, Evli has recognised,
among others, that in improving responsibility and with regard
to environmental impacts, the single most important factor in
Evli’s operations is the responsibility of the company’s invest-
ment operations and taking this into account in the product
and service range.
Continuous dialogue with stakeholders
(GRI 102-40: List of stakeholder groups, GRI 102-43: Approach to stakeholder
engagement, GRI 102-44: Key topics and concerns raised)
Evli’s principal stakeholders are its clients, personnel, sharehold-
ers, investors, the authorities, partners and media. An active
and open dialogue with these principal stakeholders helps Evli
to identify the areas of its operations that should be prioritised
and developed. Regular discussions with different stakehol-
ders form a foundation for understanding their views and needs.
Correspondingly, it is important to tell stakeholders about the
company’s goals, execution policies, values and changes in the
operating environment. This helps create a common under-
standing and trust concerning business operations and factors
that influence it.
Grouping of material topics based on the materiality analysis
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RESPONSIBILITY
STAKEHOLDERS STAKEHOLDER’S EXPECTATIONS CHANNELS EVLI’S ACTIONS IN 2020
Clients
• Competitive products and services
• Useful auxiliary and advisory services
• Reliability, data protection
• Service channels that meet needs
• Responsible operations
• Questionnaires and client feedback
• Websites and social media channels
• Client meetings, events and webinars
• Emails, newsletters and phone calls
• Two new mutual funds and two new alternative investment
funds were launched
• The principles of responsible investment, climate and
corporate governance principles were updated
• The renewed fund ESG reports were launched
• The new My Evli online service was launched
• Internal processes were developed to improve operational
efficiency and improve customer service
Personnel
• Fair treatment and open interaction
• Job stability and competitive pay
• Opportunities for professional development
• Occupational health and well-being
• Intranet and HR personnel system
• Occupational healthcare
• Performance reviews and training events
• Personnel satisfaction survey and other internal surveys
• Personnel events
• The expertise and knowledge of the employees were developed
• Team leaders were offered support in developing managerial work
• Operations were developed based on personnel surveys and
the 360-performance review made on team leaders
• Self-management webinars were organised
• The recruitment process and trainee program were developed
Shareholders
and investors
• Creating long-term value
• Profit performance
• Dividend and good return on equity
• Capital adequacy
• Responsible operations
• Interim and half-year reports, financial statements bulletins
and annual report
• Corporate Governance Statement
• Remuneration policy and report
• Stock exchange and press releases
• Annual General Meeting, Investor and analyst meetings
• www.evli.com
• Evli continued to implement its strategy from 2017
• Operations were developed to create long-term stable
financial performance
• Economic, social and environmental aspects were taken into
account in operations
Partners
(including agents
and distributors)
• Fair and equal treatment
• Competitive products and services
• Reliability and capital adequacy
• Two-way communications
• www.evli.com
• Meetings and training
• Emails and phone calls
• Information and trainings about new products and services
• Operational development based on feedback received
• Open communication and continuous dialogue
The authorities
• Compliance with laws and regulations, integration
of sustainable development with operations
• Open, transparent and reliable reporting
• Continuous interaction
• Phone calls and emails
• Participation in events and training
• Compliance with new laws, regulations and provisions and
developing business operations to adapt to changes in the
operating environment
• Open communication and continuous dialogue
Media and journalists
• Relevant, reliable and open communications
• Expertise
• Press and stock exchange releases
• Press events and interviews
• www.evli.com and social media channels
• Morning reviews, newsletters, emails and phone calls
• Multi-channel communication on topical matters
• Prompt replies to inquiries and interview requests
from the media
• Regular media meetings
Local communities
• Employment opportunities
• Co-operation with universities
• Support to communities and co-operation
with businesses
• Meetings, events and webinars
• www.evli.com and social media channels
• Activities of the universities were supported
• Summer employments and the trainee program were developed
• Continued co-operation with entrepreneurial organisations
to support entrepreneurship
• Continued support for sports and cultural activities in Finland
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RESPONSIBILITY
Evli’s key principle is to offer products and services that meet
its clients’ needs and goals. In selling products and services,
Evli focuses on ensuring that clients understand the product
or service they are buying and the associated risks, as well as
ensuring that the product or service suits the clients’ investment
goals. At Evli, responsible investing means that environmental,
social, and good governance factors are an integrated part of
portfolio management.
Responsible marketing based on integrity,
clarity and transparency
Evli’s mission is to increase clients’ wealth sustainably accor-
ding to their individual targets and its vision is to ensure that
it is perceived as “Simply Unique” by offering high-quality ser-
vices and a unique customer experience 24/7. Trust plays a key
role in order to achieve the company’s mission and vision. To
earn and maintain trust, the products and services are explained
honestly and in accordance with valid legislation. Responsibil-
ity is emphasised in the communication and marketing of pro-
ducts and services by being transparent, professional and clear.
Evli’s operations are based on the Stewardship philosophy,
which means the client’s best interest always comes first. In
Responsible products
and services
Evli, Stewardship means that the client’s assets are managed
as if they were Evli’s own. The cornerstone of this kind of oper-
ation is that Evli knows its clients and becomes familiar with
their business and financial situation as required by the client
relationship. This enables Evli to offer every client products and
services that fit their needs and goals and to ensure that clients
truly understand the product or service they are buying.
Transparent products and services that promote clients’ needs
improve client satisfaction. Client feedback in Private Ban-
king and institutional asset management is continuously moni-
tored. By continuously measuring client satisfaction, Evli wants
to identify issues that clients consider relevant, develop them
and quickly react to problems. Client satisfaction is electro-
nically measured after a meeting with a Private Banking or an
institutional client. In the survey, the client and the asset ma-
nager assess the success of the client meeting and the service
experience. Client satisfaction is reported weekly at the unit
level and quarterly to the Executive Group. In addition to Evli’s
internal client satisfaction surveys, Evli takes part in annual asset
management surveys conducted by external parties.
RESPONSIBILITY
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RESPONSIBILITY
Results and priorities in 2020
• Evli’s customer satisfaction remained at the previous years’
high level and averaged 4.6 (2019: 4.6) on a scale from 1-5.
• In KANTAR SIFO Prospera’s ”External Asset Management
2020 Finland” -survey Evli was, for the fourth consecutive
year, the most widely used institutional asset manager in
Finland and in addition the second best institutional asset
manager in Finland. Evli was especially praised for port-
folio management competence, responsible investments,
track record and sales competence.
• In KANTAR SIFO Prospera’s ”Private Banking 2020
Finland” -survey investors rated Evli’s Private Banking
as the best in Finland.
• To improve customer experience, Evli continued to
streamline its operations and reorganise its work. Evli also
invested in system upgrades and the development of new
products and services.
• Due to the restrictions imposed by the coronavirus, Evli
focused on active electronic client communication and the
organisation of webinars.
Client data protection form the basis for trust
(GRI 418-1: Number of legitimate complaints about customer privacy viola-
tion and customer loss)
In Evli’s operations, particular attention is devoted to data pro-
tection and the safeguarding of the client’s privacy protection in
the processing of personal data. In addition, Evli always ensures
that bank secrecy is observed in processing personal data. Per-
sonal data is used for taking care of client relationships, offering
products and services, direct marketing and risk management.
Evli is committed to processing personal data in accordance
with the laws, appropriately and transparently. Personal data
is processed in compliance with the EU’s General Data Protec-
tion Regulation (GDPR) and specific legislation for the finan-
cial industry.
Evli Group has several person registers for managing personal
data, each of which has a separate data protection notice. Data
security is improved on a continual basis to ensure that it meets
the requirements of the authorities, clients and the changing
operating environment.
Results and priorities in 2020
• New employees were trained in Evli’s data protection and
digital security.
• An electronic security review was sent by email to all
employees on a regular basis, highlighting current security
issues in Evli’s business environment.
Responsible investing
Evli believes that incorporating responsibility considerations
into investment decisions increases the understanding of the
investments and the related risks and opportunities more than
by simply analysing financial figures.
Responsible investment an integrated part of
investment operations and reporting
At Evli, responsibility factors have been integrated into the invest-
ment operations of Wealth Management, which means that
responsibility is systematically considered in portfolio manage-
ment. In practice, this is done with the help of an internal ESG
1)
database which is based on responsibility data produced by
MSCI ESG Research. The purpose of the ESG database is to pro-
vide portfolio managers with easy access to ESG data when mak-
ing equity and fixed-income investments. For instance, portfolio
managers can search for the following information on a company:
responsibility assessments (so-called ESG scores), data on con-
troversial activities’ contribution to revenue, and any ESG viola-
tions as well as emission data. In 2020, an ISS ESG liability ana-
lysis for possible ESG violations was also added to the database.
The ESG database is also used for reporting purposes. Evli pub-
lishes public ESG reports on all of its equity and fixed income
funds. This means that anyone can follow the responsibility of
Evli’s investments. In 2020, Evli significantly improved the ESG
reports of its equity and fixed income funds. In addition to the
ESG and UN Global Compact analysis, the reports include the
development of the fund’s responsibility score, reputational risk
metrics, carbon footprint and company specific ESG informa-
tion on the ten largest holdings.
An investment specific ESG analysis is also part of all invest-
ments in the alternative investment funds. For example, in the
Evli Private Equity I and II funds and the Evli Infrastructure I fund,
each new fund invested in is analysed using the same ESG cri-
teria, and investments are only made in the funds that meet the
criteria. Fund investments are also analysed during the invest-
ment time according to the same criteria, and the information
from the ESG analysis is transparently available to investors.
1)
ESG=Environmental, Social and Governance.
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RESPONSIBILITY
More responsible practices through engagement
Evli analyses the active selections made in equity and corpo-
rate bond funds and the direct investments in Wealth Manage-
ment every three months for potential violations of UN Global
Compact Principles and Evli’s Climate Change Principles. The
UN Global Compact is an international corporate responsibil-
ity initiative that requires companies to respect human rights,
take actions to fight corruption and take environmental issues
into consideration. Information on violations can be obtained
from the MSCI and ISS ESG databases and from other sources,
such as the news media.
1. Analysis of factors related to responsibility
and calculation of ESG scores
Active investments are regularly analysed in terms of ESG
factors. Evli has ESG data on 13,900 companies in an internal
database. An ESG score is calculated for each fund and
direct equity investment, which reflects how well the
companies as a whole have taken into consideration the risks
and opportunities associated with responsibility. Of Evli’s
funds, 67% have a very good or good ESG score.
4. Reporting on investments’ responsibility
factors to clients
Evli’s responsible investing is based on transparency and
openness, which is why responsibility factors are reported
comprehensively to clients. The responsibility reporting
consists of the funds’ ESG reports, client-specific portfolio
reports and the responsible investment annual report.
2. Monitoring of the UN Global Compact principles,
active ownership and engagement
Evli monitors its investments regularly and strives to influence the way
companies operate. If it is observed that a company is violating the
principles of human rights, labour standards, the environment or
anti-corruption as set out in the UN Global Compact, Evli seeks to
influence the company’s operations or exclude it from investments. Evli
also participates in various collaborative engagements and initiatives
with other investors with the aim of making the operations of even more
companies responsible.
3. Exclusion of companies from investments
All of Evli’s equity and fixed income funds, as well as direct equity
investments, follow the general exclusion principles. Companies
manufacturing controversial weapons, tobacco manufacturers, adult
entertainment producers, companies engaged in controversial lending
and companies producing peat for energy production are excluded from
the funds. In addition, the funds avoid investing in companies with more
than 30% of their revenue coming from coal mining, its use in energy
production, or oil sand extraction. Some funds comply with broader
exclusion criteria. In addition to the industries mentioned above, these
funds exclude companies with more than 5% of their turnover coming
from gambling, the manufacture of alcohol or weapons, and the
extraction, drilling and mining of fossil fuels or thermal coal. Evli’s private
equity funds also aim to comply with the general exclusion principles.
ESG
strategy
Every case of non-compliance with the norms and Climate Change
Principles triggers a pre-determined process at Evli. The case is first
discussed with the portfolio manager, after which Evli’s Respon-
sible Investment team analyses the company’s situation. The
Responsible Investment team has two options for further action:
1. Initiate measures for engagement
2. Exclude the investment
Cases of engagement most often concern environmental prob-
lems, human rights, workers’ rights or actions leading to cli-
mate change mitigation. Evli does not disclose the names of
the companies that are subject to engagement activities, as it
believes that the procedures and discussions are more effec-
tive when done confidentially.
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RESPONSIBILITY
Results and priorities in 2020
• The principles of responsible investment and the principles
for climate change and ownership control were updated.
As a result of the updates, tobacco manufacturers, adult
entertainment producers and companies engaged in con-
troversial lending (including so-called quick-roll compa-
nies) were added to the excluded companies, with a five
percent turnover limit, in all of Evli’s active equity and
corporate bond funds. In addition, companies with more
than 30 percent of their turnover coming from the extrac-
tion of oil sands were added to the list of companies to be
avoided.
• The responsible investment ownership model was
changed and Evli established a Responsible Investment
Executive Group which, in addition to the CEO, consists of
executives from the legal and risk management depart-
ment, institutional and private clients’ departments, port-
folio management and the responsible investment team.
The Responsible Investment Executive Group decides on
Evli’s Principles for Responsible Investment and related
practices, and reports to Evli Bank’s Executive Group.
• Renewed fund ESG reports were published. New indica-
tors describing climate and reputation risks were added
to the reports as the importance of climate change con-
tinued to grow. The new reports also feature each fund’s
ESG strategy, and the fund’s responsible investment
approaches and exclusions.
• Evli published the first analysis in accordance with the
TCFD (Task Force on Climate-related Financial Disclosures)
reporting framework. Additional information on pages
38-41.
• In August, Evli launched two new mutual funds. Evli Green
Corporate Bond, an investment fund focusing on green
corporate bonds and the Evli Equity Factor Global fund,
where responsibility is an integral part of the choice of
investment targets.
• In November, Evli launched Evli Impact Forest Fund I, which
aims to mitigate climate change by achieving positive
carbon effects. The new fund invests globally in leading,
unlisted forest funds that manage and develop forest assets.
• During the year, Evli participated in 26 Annual General
Meetings. Attendance at general meetings took into
account the restrictive measures brought about by the
coronavirus pandemic, and therefore most of the mee-
tings were attended by issuing a power of attorney with
voting instructions. Evli’s representatives participated in,
among others, the annual general meetings of Talenom,
QT Group, Kojamo, Sanoma, Verkkokauppa.com, Consti,
Marimekko, Detection Technology, Eezy, Adapteo, Fortum,
Gofore, Huhtamaki, Tokmanni, Caverion, Ponsse, Glaston,
Terveystalo, Revenion, Konecranes, MetsäBoard, Asiakas-
tieto, Valmet and NoHo Partners. The meetings were cho-
sen based on their agenda and the asset management
company’s ability to influence decisions.
• Evli continued its systematic engagement and was in con-
tact with nine companies and excluded three compa-
nies based on a strong suspicion of violating international
standards.
• In addition to engaging with companies independently,
Evli signed new engagements and continued to partici-
pate in several collaborative engagement activities. Evli
has participated in i.a. the following engagement activi-
ties: the CDP-coordinated investor letters (climate change,
deforestation, water), Climate Action 100+, the PRI’s col-
laborative engagement activities towards companies in
the oil and gas sector, the Investor Agenda Statement to
Governments on Climate Change, and the PRI’s Investor
Statement on deforestation and forest fires in the Amazon.
In addition, during 2020, Evli joined the new PRI collabora-
tive engagement, “The Need for Biodiversity Metrics”, the
CDP’s new collaborative engagement to set science-based
climate targets, and signed a joint statement, “A Sustai-
nable Recovery from the COVID-19 Pandemic”. Evli also
joined the Green Building Council. The goal of the Green
Building Council is to promote sustainable development
practices related to the built environment.
• In June, Evli celebrated its 10-year anniversary as a sig-
natory of the United Nations’ Principles for Responsible
Investment (PRI). The signatories are committed to imple-
menting the six Principles for Responsible Investment and
to reporting on the responsibility of its investments on an
annual basis.
• Evli’s responsible investing achieved good ratings in exter-
nal evaluations. In the KANTAR SIFO Prospera External
Asset Management Finland 2020 survey, Evli was ranked
best in responsible investment in Finland for the fourth
consecutive year. In addition, in an international compari-
son, the UN’s umbrella organisation for responsible invest-
ment, the PRI, awarded Evli its highest rating (A+) in the
Responsible Investment Strategy and Governance cate-
gory.
It is vital for Evli to continuously develop its responsible invest-
ment practices and to listen to feedback from its clients and
other stakeholders. Over the next few years, the goals include
renewal of the ESG reporting, launching new responsibility
funds, deepening ESG integration in portfolio management
and setting climate targets.
Renewal of the
ESG reports
Launch new
responsibility funds
Set climate
targets
Goals 2020-2021
Deepen ESG integration
in portfolio management
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RESPONSIBILITY
CASE
Evli Green Corporate Bond -
A truly green corporate bond fund
In August, Evli launched a new investment fund focusing on
green corporate bonds - the Evli Green Corporate Bond fund.
The fund is Evli’s first fund to invest in the green bond mar-
ket through corporate bonds. While many Green Bond funds
also include and significantly emphasise bonds issued by, for
example, governments and state bodies, the Evli Green Corpo-
rate Bond fund focuses only on green corporate bonds, which
is rare on a European scale.
The fund aims to invest in projects that are expected to have a
positive impact on the environment or society or on the achie-
vement of the UN Sustainable Development Goals. Achieving
the goals of the UN Sustainable Development and the Paris
Agreement will require approximately USD 6.9 trillion in infra-
structure investment annually until 2030. This means real long-
term investment potential in the corporate bond segment,
with the Evli Green Corporate Bond fund offering investors the
opportunity to benefit from the segment’s rapid growth.
However, finding genuinely green corporate bonds requires
careful analysis and attention, especially with regard to the use
of assets, but also to the reporting practices of the green cor-
porate bonds and the responsibility of the issuer more broadly.
In its analysis, Evli pays attention not only to the documentation
of the green corporate bond, but also to the company’s broader
strategic goals and how well the green corporate bond fits into
the issuer’s other activities from an ESG perspective. This allows
for a comprehensive assessment of whether the investment can
be expected to contribute to a favourable environmental and
social development.
Read more about the Evli Green Corporate Bond fund
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RESPONSIBILITY
Evli’s operations are always based on good governance, legis-
lation and official regulations. In addition, integrity and ethical
operations are considered the foundation of sustainable business.
Profit performance forms the core of financial
responsibility
(GRI 201-1: Direct economic value generated and distributed)
Financial responsibility is fundamental to Evli’s operations.
Financial responsibility means maintaining competitiveness,
strong performance and good profit performance. These fac-
tors enable profitable growth and thus add value in the long-
term to all Evli’s key stakeholders: clients, society, personnel,
and shareholders. Evli aims to improve profit performance by
enhancing operating efficiency, innovating new products and
service solutions and developing its core processes. A finan-
cially solid company can shoulder its responsibility for the envi-
ronment, look after its personnel, meet its clients’ needs and
serve society.
Evli’s goal is to increase the sales of its existing wealth ma-
nagement services, mutual funds and alternative investment
products in Finland and to increase the international sales of
Responsible governance
selected mutual funds. The goal is also to bring new products
and service solutions to the market, which help to achieve a
positive result development. In addition, Evli’s aim is to enhance
its operations in order to ensure the competitiveness of services
and continuity of operations in the future.
Evli aims to be an interesting investment, both from the per-
spective of dividend income and the increase in share value.
Evli avoids unnecessary risks and concentrates on moderate,
long-term growth and development. With responsible opera-
tions, Evli creates long-term value for the owners and improves
the ability to react to the opportunities and risks arising from
economic, social and environmental megatrends.
Results and priorities in 2020
• Despite the challenges brought about by the coronavi-
rus pandemic, Evli Group’s operating income increased to
EUR 79.7 million (EUR 75.8 million) and the Group’s operat-
ing profit 21 percent to EUR 29.1 million (EUR 24.1 million).
Among others growth in alternative investment products as
well as asset management and mutual fund fees contributed
positively to profit performance.
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• Sales of alternative investment products developed according
to plans and the total asset under management increased to
EUR 1.1 billion (EUR 0.9 billion).
• International sales suffered from market price fluctuations
and the extensive travel restrictions made acquisition of new
clients in Europe challenging. The whole year net subscrip-
tions from foreign investors were negative at EUR -471 mil-
lion (EUR 590 million).
• Evli continued its work to streamline investment processes
and improve the customer experience. During the year,
among others, a new version of the My Evli online service
was launched. Due to the remote working recommendations
brought about by the coronavirus pandemic, most of Evli’s
employees worked remotely from March onwards. Despite
the need to work remotely, all of Evli’s work tasks were taken
care of and the clients were served according to their needs.
This was possible due to IT investments made in previous
years.
• Evli paid its owners a dividend of EUR 0.66 per share (EUR
0.61), eight percent more than in the previous year.
Taxes are paid in accordance with local legislation in
each country of operation
(GRI 201-1: Direct economic value generated and distributed)
Evli’s head office is located in Finland. The company also has
branch offices and subsidiaries in Sweden and the United Arab
Emirates. In each country, Evli pays its taxes in accordance with
the local legislation. Evli is committed to ensuring that it com-
plies with all statutory obligations and it discloses all required
information to the relevant tax authorities and engages in an
open discussion with them. Evli considers compliance with tax
legislation as an important part of its corporate responsibility.
Results and priorities in 2020
• Evli paid a total of EUR 6.3 million in taxes
(EUR 4.9 million).
INCOME DISTRIBUTION, M€ 2020 2019 2018
Net interest income 0.2 0.3 0.7
Commission income and expense, net 76.8 72.2 67.1
Net income from securities transactions
and foreign exchange dealing 2.4 3.2 0.7
Other operating income 0.2 0.1 0.1
Share of profits (losses) of associates 0.4 -0.6 2.6
Total Income 80.0 75.2 71.2
Personnel expenses 25.9 24.8 23.1
Other administrative expenses 12.5 14.0 15.9
Depreciation, amortisation and write-down 5.7 3.5 2.1
Other operating expenses 1.7 3.7 3.6
Impairment losses on loans and other receivables 0.1 0.1 0.0
Society
Taxes 6.3 4.9 4.2
Social security costs 1.2 1.4 1.2
Pension expenses 3.4 4.1 3.7
Equity holders of parent company 21.3 17.3 16.0
Non-controlling interest 1.9 1.4 1.3
Distribution of income 80.0 75.2 71.2
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 24 | 149
RESPONSIBILITY
Corruption, bribes and money laundering
not acceptable
(GRI 205-2: Communication and training about anti-corruption policies and
procedures, GRI 205-3: Confirmed incidents of corruption and actions taken)
Evli does not accept corruption, bribery or any other illegal
activity under any circumstances. Evli’s ethical principles guide
its personnel in this matter. For example, employees will not
offer, demand or accept inappropriate gifts, trips or payments.
Moreover, there is an internal guideline on hosting in the com-
pany’s name and giving business gifts.
As a bank, Evli plays an important role in preventing money
laundering and the funding of terrorism. For this purpose, Evli
has clear operating instructions that apply to the entire person-
nel. In addition to statutory obligations, preventing money laun-
dering is part of Evli’s risk management and an important part
of its business operations. Knowing the client is an integral part
of the prevention of money laundering. Therefore, before a new
client relationship is formed, the client’s information is always
analysed as required by guidelines based on the law. All person-
nel who have direct contact with clients must take part in annual
trainings on money laundering and knowing the customer. Evli
has also adopted an active role in developing the regulation
and good operating practices in the industry.
Evli provides an opportunity to report violations through the
whistleblowing procedure. If an employee suspects that unethi-
cal activities have occurred or that someone has engaged in
activities that violate the law, regulations, the authorities’
instructions, or the Evli Group’s internal guidelines, a sepa-
rate procedure is available with dedicated guidelines that the
employee can follow to report the matter.
Results and priorities in 2020
• No cases of corruption, bribery or money laundering in
Evli’s operations were reported.
• Training events were mainly concerned with the prevention
of money laundering and the funding of terrorism.
Own operations help promote positive
environmental action
(GRI 302-1: Energy consumption within the organisation, GRI 302-4: Reduc-
tion of energy consumption)
Evli’s own operations do not have any significant immediate
environmental impacts. The company’s principal environmen-
tal impacts are related to its investment activities. However, the
company is aware that it can promote positive environmental
impacts through its own operations by developing and improv-
ing digital services, and reducing air travel and the consump-
tion of electricity.
It is also important for Evli to increase environmental aware-
ness among its clients and employees and offer products and
services that help to mitigate harmful environmental impacts.
With the continuous development of digital transaction chan-
nels and utilising the opportunities given by technology, Evli
offers new forms of services that have a smaller environmental
impact than before.
In all purchases, Evli seeks to ensure the responsibility of the
suppliers. The supplier’s environmental responsibility is always
a consideration in internal procurement concerning personnel
needs, client premises, business gifts, office supplies and furni-
ture. This means, among others, that business gifts are mainly
procured by suppliers that manufacture products from recycled
materials, and that durability is an important factor in choosing
office furniture. The food offered in client meetings and events
is prepared when possible using local and organic products and
food wastage is minimised.
Evli’s head office in Helsinki has been awarded the LEED
1)
Gold
certification, one of the world’s best-known green building cer-
tificates. Evli is committed to reducing the energy consump-
tion and CO
2
emissions of its offices and paying attention to
the environmental impacts of waste and consumption of paper.
Unnecessary travel is avoided by favouring telephone and video
conferences. In addition, employees continuously strive to
reduce their ecological footprint in their everyday work.
Results and priorities in 2020
• Evli continued the development of its website www.evli.com
and the My Evli online service in order to, among others,
reduce the amount of paper reporting.
• Evli’s energy consumption decreased by 46 percent. A main
factor contributing to the decreased energy consumption
was the extensive remote working recommendations dur-
ing the year brought about by the coronavirus pandemic
and the reduced office space at the Helsinki office. Air travel,
including flown kilometers and flight emissions, decreased
by 73 percent compared to 2019, mainly due to the restricted
travel recommendations due to the coronavirus pandemic.
1)
LEED=Leadership in Energy and Environmental Design.
GOVERNANCE
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RESPONSIBILITY BUSINESS OVERVIEW
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RESPONSIBILITY
Responsible employer
Evli’s success is based on the professional skills
of its employees and their ability to create new
solutions, added value for the benefit of the
clients and to serve them professionally. Evli
believes that employee commitment and thriv-
ing at work is reinforced by creating a flexi-
ble, efficient and balanced work community,
which is characterised by innovativeness and
the capacity to change and achieve change.
To ensure that the best experts in the business
will serve clients also in the future, Evli pays
particular attention to employee development
and motivation. In addition to competitive pay,
personnel benefits include expert level occu-
pational healthcare services and varied oppor-
tunities for developing skills.
PERSONNEL DATA 2020 2019 2018
Personnel 261 249 254
Permanent 233 224 226
Temporary
1)
24 25 24
On study or parental leave 4 3 4
Full time
2)
240 237 243
Part time
3)
21 12 11
Women/men (%) 39/61 36/64 38/62
Average age 41.4 41.1 40.5
Average period of service 10.5 9.9 9.1
Average personnel turnover (%)
4)
8.0 8.5 8.3
New hires 20 16 15
Sickness absences, days/person 1.2 2.2 2.9
Occupational accidents at work 0 0 0
Training days/person 1 2.1 3.7
Personnel covered by performance reviews (%) 100 100 100
1)
Includes both trainees and summer workers
2)
Includes both permanent and temporary employees with full-time contracts.
3)
Includes both permanent and temporary employees with part-time contracts
4)
Personnel turnover was calculated using the following formula: ((Number of new persons employed Jan 1-Dec 31 + number of
employees leaving Jan 1-Dec 31)/2)/number of employees on Dec 31.
Most of the personnel work in Finland
(GRI 102-8: Information on employees and other workers,
GRI 401-1: New employee hires and employee turnover)
At the end of 2020, the Evli Group had 261
employees, an increase by five percent on
the previous year. Of the total personnel, 94
percent worked in Finland, almost six percent
in Sweden and less than one percent in the
United Arab Emirates.
The total number of new hires in 2020 was
20. The number of new employees does not
include summer workers and trainees. The
average personnel turnover was eight percent.
RESPONSIBILITY
GOVERNANCE
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RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 26 | 149
RESPONSIBILITY
A diverse work environment and equal opportunities
(GRI 405-1: Diversity of governance bodies and employees)
Fairness, including equality, non-discrimination and diversity are
a material part of Evli’s responsibility. Work in this was further
organised in 2018 as Evli Bank’s Board of Directors approved
Evli Group’s diversity policy and goals for 2022. The diversity
policy defines the company’s principles concerning equality,
non-discrimination and diversity. Under the principles, Evli com-
mits to creating a workplace that is non-discriminatory, open
and positive and in which all employees are treated equally, irre-
spective of gender, age, ethnic or national background, natio-
nality, language or faith. In addition, a material factor of diver-
sity is that all employees feel they have the same opportunities
to develop and advance in their careers.
Good management of diversity and work for non-discrimina-
tion can improve personnel well-being and commitment and
enable employees to perform to their full potential. In addition,
diversity promotes innovations, productivity and the company’s
competitiveness. At Evli, diversity applies to all business areas
and diversity is taken into account in all personnel management
from hiring to career progress and development.
In addition to Evli Group’s diversity policy, the goal of the Board of
Directors’ diversity policy is to ensure that the Board is as diverse
as possible. Diversity emphasises the Board members’ expertise
regarding different industry sectors and training and skills that
complement those of other members. In addition, factors that are
relevant regarding the diversity of the Board include age and gen-
der distribution and the length of term. The goal is for both gen-
ders to be represented on the Board. Additional information about
the Board of Directors diversity is found on page 134.
Results and priorities in 2020
• In Evli’s recruiting process, an increasing focus was on diver-
sity, including collaboration with various stakeholders to
make the investment industry more attractive to women.
EVLI’S DIVERSITY 2020
Gender diversity entire personnel Gender diversity team leaders Gender diversity Executive Group Gender diversity Board of Directors
261 persons 41 persons 7 persons 6 persons
Men
61%
Men
78%
Men
86%
Men
83%
Women
39%
Women
22%
Women
14%
Women
17%
GOVERNANCE
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RESPONSIBILITY
Diversity goals for 2022
• There are at least 40 percent of each gender represented in expert
positions in all business areas.
• There are at least 30 percent of each gender represented in team
leader positions in business areas and administration.
• Both genders are sufficiently represented on the Board of Direc-
tors and in the Executive Group. In planning the composition of the
Board, important factors include members’ skills, experience and
expertise to ensure effective performance.
• In recruitment, the most suitable person for the position is always
selected.
• Both genders must be represented in the group of people selected
for the trainee program.
Evli looks after the well-being of its employees
(GRI 403-2: Types of injury and rates of injury, occupational diseases, lost
days, and absenteeism, and number of work-related fatalities, GRI 401-3:
Parental leave)
Motivated and committed employees whose well-being are
at a high level are vital to Evli’s operations, development and
profitability. Evli’s goal is to develop and promote the com-
prehensive well-being of its employees and to focus on pro-
active measures on workplace well-being. One of the key pre-
requisites for both mental and physical well-being is a work-life
balance. This is supported by offering a flexible work culture,
which means, among others, the possibility of flexible working
hours, remote working and a shortened workweek. In addition,
Evli uses a so-called age management model that takes into
account and supports employees at different stages of their
careers and lives.
Evli’s employees have access to expert level occupational
healthcare including, among others, access to specialist-level
doctors, physiotherapy, ultrasounds, MRIs and x-rays. In addi-
tion, the mental and physical well-being are supported by offer-
ing employees opportunities to take part in exercise classes and
lectures. Evli’s policy also includes preventing long-term sick
leave through an early support model.
Job satisfaction and well-being at work are measured by means
of an employee survey and smaller in-house surveys. The results
drive the further development of workplace well-being and
practices.
Results and priorities in 2020
• About three percent of the employees worked a shortemed
work week and were, for example, on part-time childcare
leave.
• With the coronavirus pandemic, the amount of remote
working at Evli increased significantly. In the past, employ-
ees, depending on their job tasks, could occasionally work
remotely. Due to the pandemic, most of Evli’s employees
worked, in part or in full, remotely from March onwards. In
order to promote well-being at work in the exceptional si-
tuation, Evli supported the employees remote working by
organising various webinars, sharing information on good
remote working practices and work ergonomics.
• Eezy Spirit’s Most Inspiring Workplaces survey was sent to
all employees, with 95 percent of employees responding.
Based on the results, the employees were satisfied with
the efficiency of Evli’s decision-making and the company’s
way of taking care of the employees’ well-being. In addi-
tion, the employees thought that Evli has developed in the
right direction in recent years and that the future prospects
are good. On the other hand, employees wished for more
development and support in, among others, one’s own pro-
fessional development and change management. Based on
employee satisfaction results, Evli was once again awarded
one of Finland’s most inspiring workplaces.
Personnel development helps increase competitiveness
(GRI 404-1: Average hours of training per year per employee, GRI 404-2:
Programs for upgrading employee skills and transition assistance programs)
The skills of motivated and committed employees support the
execution of the company’s strategy and targets. Evli constantly
GOVERNANCE
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RESPONSIBILITY
develops its employees’ professional expertise, as this enables
it to keep up with the changes in the environment and offer
innovative solutions that meet the market demand. Evli Aca-
demy, established in 2006, organises both internal and external
training events to improve the employees’ skills and to enhance
occupational health and well-being.
In addition to training opportunities, Evli encourages learning
on the job and job rotation. Job rotation is encouraged by, for
example, publishing all open positions on Evli’s Intranet.
The work of team leaders is considered an important part of
personnel development and work satisfaction. Team leaders are
trained on a continuous basis to enable them to support their
team members as well as possible and to develop the teams’
practices. The work of team leaders is evaluated regularly based
on external surveys.
Results and priorities in 2020
• The number of training days per person was approximately
one. Training days include both internally organised training
and external training.
• Four persons transferred to new job tasks as part of inter-
nal job rotation.
• The work of team leaders became even more important with
the coronavirus pandemic and the extensive remote working
recommendation. To support the work of the team leaders,
twelve team leader events were organised during the year.
These included, for example, information on how to sup-
port employees in remote working conditions and working
in exceptional circumstances brought about by the corona-
virus pandemic, recruitment and new employees, and the
360-degree leadership feedback survey.
• All team leaders participated in the Eezy Spirit 360-degree
leadership feedback survey, in which their own team leader,
team members, and colleagues evaluated their managerial
work. The aim of the survey was both to develop the work
of each team leader and to obtain information on the areas
of development that would be relevant to Evli’s work in the
coming years. Based on the results, team leaders received
particularly good feedback for quick decision-making, task
prioritisation, and good pressure tolerance. On the other
hand, areas for development included setting goals and pro-
viding constructive feedback.
An attractive employer
Competition for the best talent is very severe in the finance
sector. Finding the right people and keeping them is vital for a
company that offers expert services. Evli believes that by offer-
ing its employees good learning and development opportuni-
ties, and by investing in their well-being and work-life balance,
it can attract new employees and commit them to the company.
Evli’s recruitment activities emphasise finding the right people
who match Evli’s corporate culture and are prepared to develop
to become future top experts at Evli. Fresh graduates or stu-
dents close to graduation are attracted to work at Evli mainly
through the trainee program. The goal of the trainee program
is to find motivated young talents that can become future top
experts at Evli and bring innovations and ideas to the company.
In addition to the trainee program, Evli supports schools and
participates in various recruitment events in Finland and Swe-
den. The purpose of these events is to increase awareness of
Evli among potential employees.
Results and priorities in 2020
• The trainee program was carried out around the year despite
the coronavirus pandemic. During the year over 600 persons
applied for the trainee-program and from these seven per-
sons were hired to Evli as trainees.
• Systematic work was started to improve employer branding.
Evli feels that by improving the image of the company as an
employer, it will be easier to attract promising new employ-
ees and to retain current employees. In order to improve
the employer image, more systematic use of social media
and the improvement of the content of Evli’s own website
were started.
• Evli partnered with the Women’s Career Society in order to
support female students’ career paths.
Based on the employee satisfaction
survey results, Evli was once again
awarded as one of the most inspiring
workplaces in Finland.
GOVERNANCE
FINANCIAL REVIEW
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RESPONSIBILITY
Trainee in the
Venture Capital world
Evli’s trainee program offers recent graduates or students in
the final stages of their studies the opportunity to become
acquainted with working in investment banking, in various posi-
tions. According to Tiia Sinisalo, a participant in the trainee pro-
gram that began in the autumn of 2020, an internship at Evli
Growth Partners and Evli gave her a fast and deep learning curve
in a warm work environment surrounded by top tier professionals.
“When I applied to Evli’s trainee program in January 2020, I was
convinced that Evli is an excellent fit for me. I had discussed
Evli with my fellow students and co-workers, who had worked
at Evli either as a trainee or in a permanent position. I got the
impression that people at Evli are extremely talented and wel-
coming. The conversations convinced me that an internship at
Evli would ensure an enhanced learning curve and a great expe-
rience. I decided to apply for a position in Evli Growth Partner’s
team due to a combination of my genuine interest in the Ven-
ture Capital sector and my background as a business developer.
During my time at Evli Growth Partners, I got the opportunity to
get familiar with the Venture Capital world by seeing the invest-
CASE
ment process from the beginning to working with the portfo-
lio companies. One of the two best things about my internship
was that I was able to learn a lot. My team made very clear from
the beginning that there are no wrong or silly questions and
with their encouragement, I felt confident about asking ques-
tions about anything. Adding this to my diverse and challenging
tasks, the internship helped me to distinguish what I am par-
ticularly good at and what I still need to improve. During the
three months internship, I participated in a discussion with the
operational team and Evli Growth Partners whether we should
invest in the company or not, I conducted a few industry analy-
ses and participated in the due diligence process. In addition,
I attended the Artic15 e-event as an investor, where I pitched
our fund to start-ups as well as listened to their pitch and offers
for the investment.
The other great thing, from the many amazing experiences, was
the people and culture at Evli. Other teams organised short
introductions in their functions, which helped in understanding
Evli’s operations in the bigger picture. When it comes to Evli’s
culture, I was impressed by Evli’s goals to improve sustainabi-
lity in their operations and encourage female students in their
careers. As an active member of the Women’s Career Society, I
was thrilled that Evli was one of the companies that participated
in the workshop organised by our society. The workshop aimed
at giving support to the recruitment process by giving insights
on how to prepare for an interview.
To summarise, Evli’s trainee program met and went beyond my
expectations. An internship at Evli provides a student with a
variety of challenging and motivating tasks. The trainee’s learn-
ing curve can be as fast and deep as wished for. Overall, I felt
that the internship gave me an incredible amount of new experi-
ence and I was a valuable part of the team and Evli all the time.”
Tiia Sinisalo
Trainee at Evli’s autumn 2020 Trainee program
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RESPONSIBILITY
Reporting practice
GRI 102-47: List of material topics
The economic, social and environmental impact of Evli’s busi-
ness comes both directly through its own operations and indi-
rectly through its investment activities. The topics and priorities
relevant to Evli’s responsibility are presented on pages 15-16.
GRI 102-48: Restatements of information
No material changes have been made to previously reported
data.
GRI 102-49: Changes in reporting
Evli conducted its first GRI Corporate Responsibility Report in
2018. In the 2020 report, the scope and boundaries of the report
have remained the same and the content matches that of the
2019 report.
GRI 102-50: Reporting period
The reporting period is from January 1 to December 31, 2020.
GRI 102-51: Date of most recent report
Evli’s Annual Report 2019 including the Responsibility Report
was published on February 13, 2020.
GRI 102-52: Reporting cycle
Evli’s Annual Report is published yearly, by calendar year. The
Annual Report consists of a Business Overview, Responsibility
Report, Financial Statement and Corporate Governance State-
ment as well as the Remuneration Policy and Report.
GRI 102-53: Contact point for questions regarding
the report
The contact point for questions is Evli’s Responsible Investment
team as well as the Marketing, communications and IR team.
Contact details are available at www.evli.com.
GRI 102-54: Claims of reporting in accordance with the
GRI standards
The corporate responsibility report includes a GRI report which
has been drawn up in accordance with the GRI standards, where
applicable. The report also includes information that concerns
Evli’s own relevant responsibility matters in accordance with
the reporting principles of the GRI standard. The GRI content
comparison on pages 33-37 lists the GRI indicators used and
where more information is available. The corporate responsi-
bility report, including the GRI report, supplements Evli’s finan-
cial reporting and concerns the operations of the Group as a
whole unless otherwise indicated. The GRI report includes infor-
mation and indicators that have been identified through mate-
riality analysis that are relevant to stakeholders and Evli’s busi-
ness operations.
GRI 102-56: External assurance
The responsibility report, which includes a GRI report, is not
externally audited.
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RESPONSIBILITY
RESPONSIBILITY
THEMES
RELEVANT
RESPONSIBILITY SUBJECTS
SIGNIFICANCE TO BUSINESS
OPERATIONS AND STAKEHOLDERS
CALCULATION
PARAMETERS
Responsible products
and services
Responsible marketing Development area Own operations
Customer privacy protection and data security Base Own operations
Responsible investing Focus area
Own operations -
Responsibility of wealth
management investment
Responsible
governance
Profit performance Focus area Own operations
Taxes and tax footprint Base Own operations
Corruption, bribes and money laundering Base Own operations
Direct environmental impacts Development area
Own operations
(Helsinki office)
Responsible
employer
Fairness: equality, non-discrimination
and diversity
Focus area Own operations
Work well-being and health Development area
Own operations
(Helsinki office)
Education and development Development area
Own operations
(Helsinki office)
Attractive employer Focus area Own operations
GRI 103-1: Explanation of the material topic and its boundary
GRI 103-2: The management approach and its
components
All business areas at Evli are part of ensuring that respon-
sibility is integrated into everyday work. Every employee
is responsible for observing it in practice. Evli’s Responsib-
le Investment team supports the business areas in mat-
ters concerning responsibility and especially the coordi-
nation of responsible investment.
Evli believes that through responsible investment activ-
ities the company can have the most impact on respon-
sibility. This is why Evli has invested most in the devel-
opment of responsible investment in recent years. Evli’s
Responsible Investment team, managed by the Head of
Sustainability, is responsible for Evliäs responsible invest-
ment work. Compliance with the principles of respon-
sible investment at Evli is supervised by the Responsi-
ble Investment Executive Group. The members of the
Executive Group include the CEO, executives from
the legal and risk management department, institu-
tional and private clients’ departments, portfolio man-
agement and the Responsible Investment team. The
Responsible Investment Executive Group decides on
Evli’s Principles for Responsible Investment and related
practices and reports to Evli Bank’s Executive Group.
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GRI content index
DISCLOSURE INDEX DISCLOSURE TITLE PAGE ADDITIONAL INFORMATION
GENERAL DISCLOSURE
Organizational Profile
102-1 Name of the organization Financial Statements, p. 63
102-2 Activities, brands, products and services Evli in brief, p. 3-4
102-3 Location of headquarters Financial Statements, p. 63 Aleksanterinkatu 19 A, 00101 Helsinki
102-4 Location of operations Evli in brief, p. 3-4
102-5 Ownership and legal form Shares and Shareholders, p. 52-54, Financial Statements, p. 105-107
102-6 Markets served Evli in brief, p. 3-4
102-7 Scale of the organization Evli in brief, p. 3-4, Financial figures, p. 43
102-8 Information on employees and other workers Responsibility, p. 26-27
102-10 Significant changes to the organization and its supply chain Financial Statements, p. 108
102-11 Precautionary Principle or approach Risk management and internal control, p. 69-73
102-12 External initiatives Responsibility, p. 21
Strategy and analysis
102-14 Statement from senior decision-maker CEO’s review, p. 5-6
102-15 Key impacts, risks, and opportunities Megatrends & Strategy, p. 10-11
Ethics and integrity
102-16 Values, principles, standards, and norms of behavior Business model, p. 9
102-17 Mechanisms for advice and concerns about ethics Responsibility, p. 25
Governance
102-18 Governance structure Corporate Governance Statement, p. 131
102-19 Delegating authority Responsibility, p. 32
102-20 Executive-level responsibility for economic, environmental,
and social topics
Responsibility, p. 32
102-22 Composition of the highest governance body and its
committees
Corporate Governance Statement, p. 133-134
102-23 Chair of the highest governance body Corporate Governance Statement, p. 133-134
102-24 Nominating and selecting the highest governance body Corporate Governance Statement, p. 132
102-26 Role of highest governance body in setting purpose, values,
and strategy
Corporate Governance Statement, p. 132
102-27 Collective knowledge of highest governance body Corporate Governance Statement, p. 134-135
102-28 Evaluating the highest governance body’s performance Corporate Governance Statement, p. 132
102-30 Effectiveness of risk management processes Risk management and internal control, p. 69-73
102-35 Remuneration policies Remuneration policy, p. 140-142
102-36 Process for determining remuneration Remuneration policy, p. 140-142
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DISCLOSURE INDEX DISCLOSURE TITLE PAGE ADDITIONAL INFORMATION
GENERAL DISCLOSURE
Stakeholder engagement
102-40 List of stakeholder groups Responsibility, p. 17
102-43 Approach to stakeholder engagement Responsibility, p. 16-17
102-44 Key topics and concerns raised Responsibility, p. 17
Reporting practice
102-45 Entities included in the consolidated financial statements Financial Statements, p. 63
102-46 Defining report content and topic boundaries Responsibility, p. 15-16
102-47 List of material topics Responsibility, p. 15-16
102-48 Restatements of information Responsibility, p. 31
102-49 Changes in reporting Responsibility, p. 31
102-50 Reporting period Responsibility, p. 31
102-51 Date of most recent report Responsibility, p. 31
102-52 Reporting cycle Responsibility, p. 31
102-53 Contact point for questions regarding the report Responsibility, p. 31
102-54 Claims of reporting in accordance with the GRI Standards Responsibility, p. 31
102-55 GRI content index GRI content index, p. 33-37
102-56 External assurance Responsibility, p. 31 The report has not been externally assured
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DISCLOSURE INDEX DISCLOSURE TITLE PAGE ADDITIONAL INFORMATION
MATERIAL TOPICS
Management approach
103-1 Explanation of the material topic and its boundary Responsibility, p. 16
103-2 The management approach and its components Responsibility, p. 32
Economic topics
Economic performance
201-1 Direct economic value generated and distributed
ECONOMIC VALUE GENERATED AND DISTRIBUTED
Income distribution, M€ 2020 2019 2018
Net interest income 0.2 0.3 0.7
Commission income and expense, net 76.8 72.2 67.1
Net income from securities transactions and foreign exchange
dealing 2.4 3.2 0.7
Other operating income 0.2 0.1 0.1
Share of profits (losses) of associates 0.4 -0.6 2.6
Total Income 80.0 75.2 71.2
Personnel expenses 25.9 24.8 23.1
Other administrative expenses 12.5 14.0 15.9
Depreciation, amortization and write-down 5.7 3.5 2.1
Other operating expenses 1.7 3.7 3.6
Impairment losses on loans and other receivables 0.1 0.1 0.0
Society
Taxes 6.3 4.9 4.2
Social security costs 1.2 1.4 1.2
Pension expenses 3.4 4.1 3.7
Equity holders of parent company 21.3 17.3 16.0
Non-controlling interest 1.9 1.4 1.3
Distribution of income 80.0 75.2 71.2
Anti-corruption and anti-bribery
205-2 Communication and training about anti-corruption policies and
procedures
Responsibility, p. 25
205-3 Confirmed incidents of corruption and actions taken Responsibility, p. 25
Environmental topics
Energy
302-1 Energy consumption within the organization Responsibility, p. 25
302-4 Reduction of energy consumption Responsibility, p. 25
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DISCLOSURE INDEX DISCLOSURE TITLE PAGE ADDITIONAL INFORMATION
MATERIAL TOPICS
Social responsibility
Employment
401-1 New employee hires and employee turnover Responsibility, p. 26
401-2 Full-time staff benefits not provided to fixed-term or part-time staff All employee benefits are offered throughout
the personnel, regardless of employment.
401-3 Parental leave Employees are provided with an opportunity
of shortened working hours and depending on
work tasks, the possibility of flexible working
hours.
Occupational health and safety
403-2 Types of injury and rates of injury, occupational diseases, lost days,
and absenteeism, and number of work-related fatalities
Responsibility, p. 26
Training and education
404-1 Average hours of training per year per employee Responsibility, p. 26
404-2 Programs for upgrading employee skills and transition assistance
programs
Responsibility, p. 28-29
404-3 Percentage of employees receiving regular performance and career
development reviews
Responsibility, p. 26 Evli’s development discussion process covers all
permanent employees who are not absent due to,
for example, parental leave or study leave.
Developmental discussion needs for temporary
employees are assessed case-by-case.
Diversity and equal opportunity
405-1 Diversity of governance bodies and employee Responsibility, p. 27-28, Board of Director’s Diversity; Corporate
Governance Statement, p. 135
Customer privacy protection
418-1 Number of legitimate complaints about customer privacy violation
and customer loss
Responsibility, p. 19
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DISCLOSURE INDEX DISCLOSURE TITLE PAGE ADDITIONAL INFORMATION
MATERIAL TOPICS
Social responsibility
Evli’s own material CSR topics
Responsible investments
Engaging with investment objects on environmental, social and
governance matters
Responsibility, p. 21
Customer satisfaction
Customer satisfaction Responsibility, p. 19
Taxes and tax footprint
Total tax Responsibility, p. 24
Direct impacts of own operations
Decreasing amount of air travel Responsibility, p. 25
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Task Force on Climate-related Financial Disclosures report
ANNEX
Evli has committed to support the Task Force on Climate-related Financial Disclosures (TCFD) and published
its first TCFD-report in 2020. This annex includes updated information about Evli’s climate risks and possibili-
ties as well as information about the progress of Evli’s climate work in 2020.
Introduction
In August 2019, Evli became a public supporter of the TCFD
with the goal of developing Evli’s own climate risk reporting.
The TCFD is an international climate risk reporting framework
designed to improve reporting on the economic impact of cli-
mate change by making it clearer, more comparable and more
consistent.
It is important for asset managers and other investors to be able
to identify and assess the economic impact of climate change
on both their own operations and those of investment compa-
nies. The transition to a low-carbon economy is changing the
business environment and companies are also exposed to the
physical effects of climate change. On the other hand, climate
change also creates opportunities for companies that offer
products or services that contribute to climate change adap-
tation and mitigation.
Reports based on TCFD’s recommendations provide stakehold-
ers of the company information on:
1. the management of climate-related risks and opportunities
(role of the Board of Directors and the management)
2. the actual and potential impact of climate-related risks and
opportunities on the company’s business, strategy and
financial planning
3. the company’s processes for identifying, assessing and
managing climate risks
4. the indicators and targets for assessing and managing
climate-related risks and opportunities.
Management
Evli’s Board of Directors and Executive Group regularly address
climate-related issues as part of a broader debate on responsi-
bility. Evli’s Head of Sustainability regularly attends Board and
Executive Group meetings. In addition to the work carried out
by the Board of Directors and the Executive Group, Evli has a
Responsible Investment Executive Group, which decides on the
principles and practical procedures of responsible investments
at Evli. The members of the Executive Group include the CEO,
executives from the legal and risk management department,
institutional and private clients’ departments, portfolio ma-
nagement and the Responsible Investment team.
Under the supervision of the Head of Sustainability, the Respon-
sible Investment team is responsible for coordinating and
developing ESG matters in funds and discretionary portfolio
management, and for engaging with companies. Evli´s Prin-
ciples for Responsible Investment define Wealth Manage-
ment’s approach to responsible investment. Wealth Manage-
ment also observes Evli´s Principles for Climate Change, which
describe Evli’s practices for addressing climate change and its
implications on investment activities. The Responsible Invest-
ment team monitors the implementation of the UN Global
Compact principles and Evli´s Principles for Climate Change
and has the right to exclude individual companies from invest-
ments.
Portfolio managers also take ESG matters, including climate
issues, into consideration when analysing potential invest-
ments and making investment decisions. Portfolio managers
Reporting framework of the
TCFD report
1.
Management
2.
Strategy
3.
Risk management
4.
Indicators
and targets
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RESPONSIBILITY
are responsible for implementing the Principles for Respon-
sible Investment and ESG integration in portfolio management.
Strategy
At Evli, responsibility has been an integral part of portfolio mana-
gement for many years. In January 2020, Evli raised responsi-
bility to one of its strategic focus areas for the coming years.
Regarding climate change, Evli is actively working on setting
its own climate change targets. Climate change mitigation has
always been important to Evli, and Evli wants to create products
that meet the challenges of climate change and set concrete
goals for Evli’s operations.
As an asset manager, Evli’s most significant climate risks and
opportunities are related to investment activities, as Evli’s
own operations do not cause significant direct environmental
impacts. Evli is committed to reducing energy and CO
2
emis-
sions at its premises and avoiding unnecessary travel. Thus,
Evli’s strategy focuses on addressing climate-related risks and
opportunities and their impact on Evli’s products and invest-
ment strategies.
The TCFD divides climate change-related risks into risks related
to the transition to a low-carbon economy and to the physical
impacts of climate change. Transition risks are financial risks that
are caused by the transition towards a low-carbon economy.
These include risks arising from changes in policy, regulation,
technology and markets that, if realised, may affect the market
value and returns of investments. As clients’ climate strategies
evolve, Evli must also ensure that its products and services meet
their changing needs. Investing in companies deemed to con-
tribute to climate change will also increase the reputational risk
associated with investment activities.
Physical risks, on the other hand, are economic risks linked to
the physical effects of climate change, which may arise from
particular events or long-term changes in the climate. In Evli’s
investment activities, physical risks can materialise through, for
example, real estate investments, which may be increasingly
exposed to extreme weather events and damage caused by
sea-level rise or floods as a result of climate change. However,
the physical effects of climate change are not limited to real
estate investments, but also affect other asset classes such as
equity and corporate bonds. In these asset classes, for example,
industries dependent on foreign raw materials may be vulner-
able to increasing extreme weather conditions.
Climate change also brings opportunities for investors. These
include investments in companies that take advantage of
opportunities relating to climate change mitigation and adap-
tation. In addition, climate change will increase the market for
sustainable investments (e.g., green bonds), providing oppor-
tunities for new product development. For instance, in the fall
of 2019, Evli organised the first ever issue of a structured Green
Note on the Finnish market. The proceeds from the issue will
be used to finance sustainable development projects. In addi-
tion, in 2020 Evli launched the Evli Green Corporate Bond fund,
a new investment fund focusing on green corporate bonds and
a new forest fund, Evli Impact Forest Fund I, which seeks to
mitigate climate change by achieving positive carbon effects.
In the case of the forest fund, which is part of the alternative
investment funds, the return premium received by Evli depends
on the achievement of the fund’s carbon sequestration target.
Evli has analysed the sustainability of its investment strategy by
conducting scenario analyses on a few of its investment port-
folios. However, Evli still believes that both the tools available
and the quality of data used in the analyses should be better
in order to be able to assess and report with sufficient accuracy
on the potential impacts of climate risks and opportunities in
different global warming scenarios.
The responsible investments governance model
Responsible Investment Executive Group
• Decides on the principles and practical procedures of responsible investing
• Members: CEO, executives from the legal and risk management department,
institutional and private clients’ departments, portfolio management and the
Responsible Investment team
• Regular meetings on a quarterly basis
• Reports to Evli’s Executive Group.
Responsible Investment team
• Monitors the implementation of the UN Global Compact principles and Evli´s
Principles for Climate Change. Has the right to exclude individual companies
from investments
• Responsible for engaging with companies
• Report to the Responsible Investment Executive Group.
Portfolio Managers
• Take ESG matters into consideration when analysing potential investments
and making investment decisions
• Responsible for implementing the Principles for Responsible Investment
and ESG integration
• Reports to the Responsible Investment team on companies that violate
the Principles for Responsible Investment.
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Risk Management
Evli’s Principles for Climate Change establish the foundation
for observing and managing climate change and its impacts
on investment activities. The identification and assessment
of climate risks are based on an analysis of the investment by
portfolio managers and the Responsible Investment team. The
measures used in climate risk management are based on the
Principles for Climate Change and include analysing and moni-
toring the greenhouse gas emissions as well as engaging with
companies and excluding companies. Evli uses external service
provider’s data to monitor the Principles for Climate Change
and in other daily responsible investing work. The data is also
used by the company’s portfolio managers in investment deci-
sions.
The emissions of companies in Evli’s equity and fixed income
funds are monitored by analysing, in accordance with the
TCFD’s recommendations, the funds’ weighted average carbon
intensity, which measures the portfolio’s exposure to carbon-in-
tensive companies. Emission data, among other ESG data, is
integrated into the portfolio management systems and this way
Evli is also able to monitor and evaluate the development of
climate risks in the investments. In addition, Evli has excluded
companies that manufacture peat for energy production and
avoids investing in companies that earn a significant part of their
revenue (at least 30 percent) from the mining of thermal coal or
its use in energy production. If a company has a credible plan
to reduce its use of thermal coal, the Responsible Investment
team may decide to deviate from the exclusion. In 2020, the cli-
mate principles were tightened and companies with more than
30 percent of their revenue coming from oil sands extraction
were added to the exclusion list.
Evli also sees engagement with companies as one way to mana-
ge risks related to climate change and seeks in its engagement
work to encourage companies to report in line with the TCFD’s
recommendations. In addition, Evli participates in a number
of investor initiatives (more information on page 21) aimed
at, among others, influencing companies at risk from climate
change, and at encouraging governments to take more ambi-
tious measures to mitigate climate change. In addition to these
measures, Evli regularly monitors changes in climate change
regulation.
Indicators and targets
Evli regularly monitors the development of the carbon foot-
print of its equity and fixed-income funds by calculating their
weighted average carbon intensity, that is, by analysing Scope
1 and 2 emissions
1)
for each investment, comparing them to
the company’s revenue and weighting each investment with its
relative share in the portfolio. The carbon intensity of a fund is
compared with the corresponding figure in the fund’s bench-
mark index.
Evli has excluded Scope 3 emissions
1)
because they are not yet
widely reported by companies and are still largely based on
estimates.
While carbon footprinting helps to outline the emissions pro-
file of investments, it is not a perfect indicator to illustrate the
emission characteristics of a portfolio or help assess future emis-
sion trends or emission reduction opportunities. For this rea-
son, Evli also analyses the proportion of companies owning
fossil fuel reserves and compares them with the fund’s bench-
mark index. In addition, Evli is also analysing the companies’
transition to low carbon, by dividing the companies into differ-
ent categories according to the risks and opportunities asso-
ciated with the companies’ energy transition. This enables Evli
to assess the potential for reducing the fund’s carbon footprint
in greater detail and to identify companies that are exposed to
risks related to climate change. Evli also regularly explores new
tools to better measure the actual impact of investments on
various stakeholders and the environment, including the impact
on climate change.
In line with its responsible investment objectives, Evli updated
the ESG reports of its funds in 2020 and they are publicly avai-
lable on www.evli.com. In the future, Evli seeks to make its
reporting more forward-looking, by using, for instance, sce-
nario analysis. As this work progresses, Evli will also look into
setting targets for managing the risks and opportunities asso-
ciated with climate change in its investments. Evli is currently
investigating, for example, when it would be possible for Evli’s
portfolios to achieve carbon neutrality.
1)
The calculation of carbon footprint figures is defined by the international
standard GHG protocol (Greenhouse Gas Protocol), for example. The GHG
protocol breaks down greenhouse gas emissions into scopes 1-3. Scope
1 greenhouse gas emissions refer to emissions directly occurring from
sources that are owned or controlled by the company. Scope 2 greenhouse
gas emissions refer to indirect emissions generated in the production of
electricity purchased by the company. Scope 3 includes indirect emissions
related to the company, including those from products, outsourcing, and
business travel.
Evli’s climate change principles
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RESPONSIBILITY
Carbon intensity (1)
(t CO
2
e / USD million)
Compared
to benchmark (2)
Weight of companies
owning fossil fuel
reserves (3) (%)
Compared
to benchmark (2) Coverage / Fund (4)
Coverage /
Benchmark index (4)
Investments in Solutions
category in the MSCI’s
Low Carbon Transition
classification (5)
Equity Funds
Evli Emerging Frontier 473.3 1.6% 20.9%
Evli Europe 249.9 71.8% 0.0% -8.3% 98.5% 99.7% 7.9%
Evli GEM 944.0 263.2% 14.0% 5.1% 88.2% 99.8% 2.2%
Evli Japan 113.5 51.0% 0.0% -5,1% 95.8% 100.0% 4.7%
Evli Global 48.1 -65.5% 0.0% -5.3% 99.3% 99.7% 5.4%
Evli Global X 48.3 -65.4% 0.0% -5.3% 98.7% 99.7% 5.2%
Evli Equity Factor Europe 57.4 -60.5% 0.2% -8.1% 99.5% 99.7% 7.4%
Evli Equity Factor Global 44.0 -68.5% 0.1% -5.2% 99.5% 99.7% 5.7%
Evli Equity Factor USA 41.4 -69.1% 0.0% -3.6% 97.7% 99.7% 5.3%
Evli North America 78.4 -44.5% 0.9% -3.1% 98.2% 99.7% 4.0%
Evli Nordic 55.4 -51.4% 0.0% -1.9% 93.5% 99.8% 11.4%
Evli Sweden Equity Index 34.8 0.0% 0.0% 0.0% 99.6% 100.0% 2.6%
Evli Swedish Small Cap 33.9 -47.4% 0.0% -2.3% 80.5% 90.9% 1.3%
Evli Finland Mix 185.5 0.0% 67.7% 6.5%
Evli Finnish Small Cap 65.9 -41.0% 0.0% 0.0% 43.8% 62.1% 9.0%
Evli Finland Select 352.9 29.8% 0.0% 0.0% 81.1% 88.0% 1.9%
Fixed Income Funds
Evli Green Corporate Bond 178.6 -42.7% 3.1% -9.4% 86.6% 96.0% 11.1%
Evli European High Yield 213.4 6.8% 0.4% -4.1% 66.5% 83.7%
Evli European Investment Grade 138.6 -28.3% 2.1% -9.4% 89.9% 95.9% 2.9%
Evli Emerging Markets Credit 820.1 3.3% 10.9% -7.6% 71.9% 89.1% 2.5%
Evli Euro Liquidity 263.6 2.2% 53.8% 3.3%
Evli Short Corporate Bond 166.2 1.4% 83.2% 5.1%
Evli Nordic Corporate Bond 189.2 24.5% 0.0% -8.4% 72.3% 95.8% 7.5%
Evli Target Maturity Nordic Bond 189.4 0.0% 52.5% 5.4%
Evli Corporate Bond 180.3 1.2% 1.5% -7.5% 82.9% 93.4% 3.0%
Sources: Evli, MSCI ESG Research.
1) Evli uses weighted average carbon intensity to measure carbon footprint. A fund’s weighted average carbon intensity is calculated by dividing the company-specific scope 1 and scope 2 greenhouse gas emissions by the company’s revenues.
After that, company-specific carbon intensity is multiplied by the company’s portfolio weight. The fund-specific carbon footprint is a sum of company-specific carbon intensities apportioned based on portfolio weights. Scope 1 greenhouse gas
emissions refer to emissions directly occurring from sources that are owned or controlled by the company. Scope 2 greenhouse gas emissions refer to indirect emissions generated in the production of electricity purchased by the company.
2) Compared to benchmark figure shows how the fund compares to corresponding figures for the benchmark index. As it is not possible to calculate this figure to all benchmark indeces, some sections are left blank.
3) Weight of companies owning fossil fuel reserves shows the share of companies owning coal, gas or oil reserves in the fund. In this report coal reserves refer to use of coal in energy production (thermal coal).
4) Coverage indicates the share of fund’s/index’s holdings (measured by market value) for which emissions data is available. The emissions data is based on emissions reported by the companies or other publicly available emissions data (e.g. CDP)
and the data provider’s estimate of emissions.
5) Shows the share of companies which have been classified in MSCI’s Low Carbon Transition Classification to Solutions category. The Solutions category means that, according to MSCI’s analysis, the companies in this category have the potential
to benefit through the growth of low-carbon products and services.
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The spread of the coronavirus into a global pandemic was reflected
in Evli’s operations and economic development in the first half
of the year. However, with the recovery that began in the spring,
Evli’s business development in the second half of the year turned
for the better and the earnings development in the fourth quarter
in particular was excellent. For the full year, operating income
increased by five percent to EUR 79.7 million and operating profit
by 21 percent to EUR 29.1 million. Evli’s return on equity rose
to 26.2 percent and the ratio of recurring revenue to operating
expenses was 124 percent.
Financial review
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42 | 149ANNUAL REPORT 2020EVLI BANK PLC
(2019: 0.66)
Dividend/share (EUR)
0.73*
(2019: 124)
Recurring revenue ratio (%)
124
Key financial figures
(2019: 23.4)
Return on equity (%)
26.2
2020 2019 2018 2017 2016
Income statement key figures
Operating income, M€ 79.7 75.8 68.5 71.4 60.0
Operating profit/loss, M€ 29.1 24.1 18.9 21.3 11.1
Operating profit margin, % 36.5 31.8 27.6 29.8 18.5
Profit for the financial year, M€ 23.2 18.7 17.3 17.5 9.7
Profitability key figures
Return on equity (ROE), % 26.2 23.4 23.0 25.5 14.3
Return on assets (ROA), % 2.7 2.1 1.9 2.0 1.4
Balance sheet key figures
Equity-to-assets ratio, % 12.3 8.9 9.5 7.6 8.6
Group´s capital adequacy ratio, % 15.2 15.1 16.2 15.0 15.3
Key figures per share
Earnings per Share (EPS), fully diluted, € 0.87 0.71 0.68 0.69 0.42
Comprehensive Earnings per Share (EPS), fully diluted, € 0.88 0.71 0.67 0.69 0.40
Dividend/share, € 0.73* 0.66 0.61 0.52 0.40
Equity per share, € 3.86 3.40 3.27 3.12 2.81
Share price at the end of the period, € 12.20 10.40 7.28 9.60 6.75
Other key figures
Expense ratio (operating costs to net revenue) 0.63 0.68 0.7 0.7 0.8
Recurring revenue ratio, % 124 124 113.0 113.0 94.0
Personnel at the end of the period 261 249 254 240 244
Market value, M€ 294.1 248.6 172.5 224.9 157.4
*Board of Directors' proposal.
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Graphs of the financial development
Net Revenue (M€)
2019 20202016 2017 2018
60.0
71.4
68.5
75.8
79,7
18.9
24.1
29.1
Operating profit (M€)
& profit margin
(%)
2020
2016 2017 2018
11.1
21.3
18.5%
29.8%
27.6%
2019
31.8%
36.5%
18.7
23.2
Net profit
(M€)
2019
17.3
20202016 2017
9.7
2018
17.5
Net commission income
(M€)
2019
67.1
72.2
76.8
20202016 2017
54.3
2018
65.2
Proportion of recurring revenue
to operating expenses
(%)
113
124 124
94
113
20202016 2017 2018
2019
Return to equity (%)
23.0 23.4
26.2
14.3
25.5
20202016 2017 2018
2019
Net Assets Under Management
(bn €)
10.6
11.2
11.4
14.3
14.1
2019 20202016 2017 2018
Evli Bank Plc
Northern Horizon Capital A/S
Evli Alexander Incentives Oy
*Diluted IFRS.
**Board of Directors’ proposal.
Earnings/share*
(€)
and dividend/share
(€)
0.42
0.40
0.69
0.68
0.71
0.52
0.66
0.61
20202016 2017 2018
2019
0.87
0.73**
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Board of directors report
1.1.–31.12.2020
Market performance
2020 was an exceptional investment year in
many ways. The coronavirus crisis that started
in the spring triggered an unprecedented
panic reaction on the markets, leading to a
rapid collapse in stock prices. At the same
time, national economies globally plunged
into recession or came to a standstill, as soci-
eties shut down due to coronavirus restrictions.
The situation was not helped by persistently
high political risks due to Brexit, the US pre-
sidential election and the trade war between
China and the USA. However, as summer
neared, coronavirus concerns abated slightly,
and although concerns over a second wave of
the virus maintained uncertainty on the mar-
kets, stock prices started to rise again rapidly,
assisted by the unprecedented stimulus mea-
sures of governments and central banks. The
growth continued throughout the rest of the
year, as a result of which many stock exchanges
reached new record levels at the end of the
year.
Based on the Purchasing Managers’ Index
at the end of 2020, confidence in the corpo-
rate sector clearly improved from the lows
of the coronavirus crisis, and companies are
well positioned for earnings growth. However,
uncertainty on the markets was increased by
the aftermath of the US presidential elections
and forthcoming political policies, as well as
the development of the second wave of the
coronavirus and the effectiveness of COVID-
19 vaccines.
In the end, 2020 proved to be a good invest-
ment year. On the equity markets, US equities
(S&P 500) rose 18.4 percent and Finnish equi-
ties (OMX Helsinki CAP) 15.7 percent. How-
ever, European equities (Stoxx 600) declined
by 1.4 percent. The values of interest-bea-
ring papers also developed positively. The
values of corporate bonds with higher ratings
rose 2.7 percent and the values of high yield
bonds with lower ratings rose 1.7 percent du-
ring 2020. The values of euro area government
bonds rose five percent over the same period.
The euro strengthened by 8.9 percent against
the dollar.
Due to the strong market recovery, net sub-
scriptions to mutual funds registered in Fin-
land turned positive after a challenging start
to the year. Net subscriptions to all funds re-
gistered in Finland totalled EUR 1,222 million
(2019: EUR 376 million) during 2020.
Financial performance
Development of revenue and result
In 2020 the Evli Group’s net commission
income was six percent above the comparison
period and was EUR 76.8 million (EUR 72.2 mil-
lion). The growth was particularly raised by the
positive development of fund and asset ma-
nagement fees. During the year, profit-related
fees from asset management or mutual funds
came to EUR 6.7 million (EUR 1.1 million). As
a consequence of the coronavirus crises du-
ring the spring, advisory fees decreased due
to delays or suspensions in client assignments.
During 2020 net income from securities transac-
tions and foreign exchange dealing decreased
from the previous year to EUR 2.4 million (EUR
3.2 million). This was due to the significant ne-
gative value changes in the first-quarter result
due to the market collapse. Overall, during
2020, the return from Evli Group’s operations
increased five percent year on year and was
EUR 79.7 million (EUR 75.8 million).
Overall costs for 2020, including depreciation,
amounted to EUR 50.6 million (EUR 51.7 mil-
lion). The Group’s personnel expenses totalled
EUR 30.5 million (EUR 30.4 million) including
estimated performance bonuses for the per-
sonnel. The Group’s administrative expenses
were EUR 12.5 million (EUR 14.0 million). The
Group’s depreciation, amortization and write-
downs were EUR 5.7 million (EUR 3.6 mil-
lion). The increase in depreciation is mainly
explained by the transfer of rental expenses to
depreciation in accordance with IFRS 16. In the
comparison period, rental expenses were pre-
sented as part of other operating expenses.
The Group’s other operating expenses totalled
EUR 1.7 million (EUR 3.7 million). Impair-
ment losses on loans and other receivables
were EUR 0.1 million (EUR 0.1 million). Evli’s
expense/income ratio was 0.63 (0.68).
The Group’s operating profit for 2020 exceeded
the comparison period and was EUR 29.1 mil-
lion (EUR 24.1 million). The operating margin
was 36.5 percent (31.8%). The profit for 2020
was EUR 23.2 million (EUR 18.7 million). The
Group’s annualized return on equity was 26.2
percent (23.4%).
Balance sheet and funding
At the end of 2020, the Evli Group’s balance
sheet total was EUR 772.6 million (EUR 923.2
million). Due to daily changes in client activity,
significant fluctuations in the size of the ba-
lance sheet total are possible from one quar-
ter and from one year to the next. At the end
of 2020, the Evli Group’s equity was EUR 95.4
million (EUR 81.8 million).
Evli applies the standardized approach (ca-
pital requirement for credit risk) and the basic
indicator approach (capital requirement for
operational risk) in its capital adequacy cal-
culation. The Group’s capital adequacy ratio
of 15.2 percent clearly exceeds the regulator’s
requirement of 10.5 percent. In response to the
coronavirus crisis, the authorities eased banks’
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ANNUAL REPORT 2020EVLI BANK PLC 45 | 149
FINANCIAL REVIEW
capital requirements, and consequently, Evli’s
capital adequacy ratio fell to the current level
from the previous level of 11.5 percent. The
Group’s own minimum target for capital ade-
quacy is 13.0 percent.
The Group’s funding from the public and credit
institutions decreased by 26 percent com-
pared to the previous year. The company’s loan
portfolio decreased four percent compared to
the previous year and was EUR 109.6 million
(EUR 114.0 million). The ratio of loans granted
by the Group to Evli Bank Plc’s deposits from
the public was 28.4 percent. The Group’s liqui-
dity is good.
Due to the coronavirus crisis, the probability
of credit losses has increased. As a result of
this Evli increased its loan loss provision du-
ring the first half of the year by EUR 0.1 million
in accordance with IFRS 9. Evli’s loan portfolio
consists mainly of secured investment loans,
which collateral values are monitored on a
daily basis. A credit loss of EUR 0.1 million was
realized during the year.
Business areas
Wealth Management and Investor
Clients
The Wealth Management and Investor Cli-
ents segment offers services to present and
future high net worth private individuals and
institutions. The comprehensive product and
service selection includes asset management
services, fund products offered by Evli and its
partners, various capital market services and
alternative investment products. The segment
December. At the end of the year, Evli had 30
investment funds registered in Finland. The
combined assets of the traditional mutual
funds managed by the company were EUR 8.7
billion (EUR 9.6 billion). Of this, approximately
EUR 2.4 billion were invested in equity funds
(EUR 2.5 billion), EUR 6.0 billion in fixed income
funds (EUR 7.0 billion) and EUR 0.2 billion in
balanced funds (EUR 0.1 billion).
Alternative investment products
Sales of strategically important alternative
investment products developed according
to expectations, considering the market si-
tuation. Subscriptions and investment com-
mitments for alternative investment products
totalled EUR 206 million (EUR 258 million) du-
ring the year. In the spring, Evli launched the
Evli Infrastructure Fund I, to which close to EUR
104 million was raised during the year. The
fund focuses on global infrastructure projects.
In November Evli launched the Evli Impact Fo-
rest Fund I. The fund invests in leading unlisted
forest funds globally that manage and develop
forest assets. By the end of the year EUR 28
million had been raised to the fund.
Other investment products
As a result of the market turmoil in the spring,
there was a peak in demand for Evli’s broke-
rage products, which, however, levelled off as
the markets calmed down during the summer
and fall. From a cumulative point of view, bro-
kerage fees were almost on the previous years
level.
also includes execution and operations activi-
ties that directly support these core activities.
Wealth Management
The assets under management in Evli’s Wealth
Management decreased during the spring due
to the coronavirus crises. Despite the market
recovery the assets in discretionary asset ma-
nagement fell somewhat short of the previous
year. At the end of the year, Evli had EUR 5.2
billion (EUR 5.3 billion) in discretionary asset
management assets, which includes both the
traditional and digital services.
Traditional mutual funds
The coronavirus crisis reflected negatively on
fund sales during the year as clients sold their
holdings during the spring and at the end of
the year. The majority of redemptions were in
short-duration fixed income funds. Net sub-
scriptions for January-December were EUR
-1,071.5 million (EUR 958.1 million). Evli’s stra-
tegic target is to boost the international sales
of its investment products. The coronavirus cri-
sis was also reflected in the behaviour of fo-
reign investors and led to net redemptions
from fixed income funds. In addition, new sales
was challenging due to extensive travel restric-
tions. During 2020 net subscriptions from fo-
reign investors were negative at EUR -471 mil-
lion (EUR 590 million).
According to the Mutual Fund Report car-
ried out by Investment Research Finland, Evli
Fund Management Company’s market share
decreased 1.1 percentage points on the pre-
vious year and was 6.6 percent at the end of
Net sales per fund classes 1-12/2020
(MEUR)
-12000
-1 000
-800
-600
-400
-200
0
200
400
-120
-980
206
-11
Equity funds
Fixed income funds
Alternative investment
funds
Other
GOVERNANCE
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RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 46 | 149
FINANCIAL REVIEW
Awards
During the first half of the year, Evli’s institu-
tional asset management received recognition
from the independent KANTAR SIFO Prospera
“External Asset Management Finland 2020”
-survey, where Evli was for the fourth conse-
cutive year in a row the most widely used insti-
tutional asset manager in Finland. In addition,
institutional investors ranked Evli as the sec-
ond-best institutional asset manager in Finland
and Evli’s brand strength was assessed as the
strongest in asset management services. Evli
was also placed first in among others portfo-
lio management competence and responsible
investments (ESG).
During the second half of the year Evli was
awarded best Finnish Private Bank for the se-
cond year in a row, in the KANTAR SIFO Pros-
pera ”Private Banking 2020 Finland” -survey.
Evli’s fund knowledge received international
recognition during the first half of the year.
Morningstar awarded Evli best fund manage-
ment company in Sweden. In the “Best Fund
House: Overall” category, the rankings are
determined based on five-year risk-adjusted
returns, taking into account all funds regis-
tered in the country by the fund management
company.
In Lipper Fund Awards 2020 France, Evli
received the award of best fixed income house
among smaller fund management companies.
In addition, Evli Short Corporate Bond B was
rewarded with both “Best Fund over 3 years”
and “Best Fund over 5 years” in the “Bond
EUR Corporates Short Term” category In Lip-
per Fund Awards 2020 in Europe, Nordics,
Germany and France. Evli Nordic fund was
awarded “Best Fund over 5 years” and “Best
Fund over 10 years” in Lipper Fund Awards
2020 in Europe and “Best Fund over 5 years”
in Lipper Fund Awards 2020 in Germany and
France in the “Equity Nordic” category.
Financial performance
In 2020 the Wealth Management and Inves-
tor Clients segment’s profit developed favou-
rably. The segment’s net revenue grew nine
percent year on year totalling EUR 67.1 mil-
lion (EUR 61.6 million). In particular, an increase
in the management fees of alternative invest-
ment products and the increased perfor-
mance-based fees due to successful invest-
ment activities had a positive impact on the
revenue development. During the year, EUR
6.7 million in performance-based and similar
fees were received from asset management
and funds (EUR 1.1 million).
Development of client assets under
management
Client assets under management consist of
direct investments in mutual funds and alter-
native investment funds, discretionary asset
management and assets managed through
Evli’s subsidiaries and associated companies.
Assets under management decreased sub-
stantially during the market collapse in March
but recovered during the summer and fall. Due
to the positive development, the Group’s total
net assets under management nearly reached
the record level of the previous year being
Split of Wealth Management fees 2020
Traditional funds
Alternative funds
Fund performance fees
Brokerage
Asset Management
Other fees
KEY FIGURES - WEALTH MANAGEMENT AND INVESTOR CLIENTS SEGMENT
M€ 2020 2019 Change %
Net revenue 67.1 61.6 9%
Operating profit/loss before Group allocations 33.5 28.3 18%
Operating profit/loss 27.7 20.8 33%
Number of personnel 160 154 -35%
Market share, %* 6.6 7.7 -14%
Net subscriptions** -1.071 958.1 -
*Evli Fund Management Company. Source: fund report by Investment Research Finland
**Net subscription to Evli’s traditional mutual funds. Source: fund report by Investment Research Finland
Development of Investor client commission
(M€)
0
10,0
20,0
30,0
40,0
50,0
60,0
70,0
80,0
61.6 - 2.5
1.9
3.2
- 0.8
3.5
67.2
0.3
12/2019 level
Traditional funds
Alternative funds
Fund performance fees
Other fees
Brokerage
Asset Management
12/2020 level
53%
14%
3%
13%
16%
1%
GOVERNANCE
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RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 47 | 149
FINANCIAL REVIEW
EUR 14.1 billion (EUR 14.3 billion) at the end
of December.
At the end of the year, assets under discre-
tionary management amounted to EUR 5.2 bil-
lion (EUR 5.3 billion). Correspondingly, direct
investments in Evli’s traditional mutual funds
were EUR 6.1 billion (EUR 6.7 billion) at the
end of the year. The assets under manage-
ment in alternative investment funds were EUR
1.1 billion (EUR 0.9 billion). Assets managed
through subsidiaries and associated compa-
nies increased somewhat to EUR 1.7 billion
(EUR 1.4 billion).
Advisory and Corporate Clients
The Advisory and Corporate Clients segment
provides advisory services related to M&A
transactions, including corporate acquisitions
and divestments, IPOs and share issues. The
segment also offers incentive plan design
and administration services and investment
research for listed companies.
M&A transactions
The coronavirus crisis had a substantial impact
on the unit’s business, leading to delays and
suspensions of advisory assignments in the
spring. The M&A market reactivated in the
fall, and the mandate base grew considerably.
However, the increased uncertainty at the end
of the year led to projects being postponed to
2021. At the end of December, the unit’s man-
date base was at a good level. For the whole
year, invoiced advisory fees were clearly below
the previous year at EUR 3.3 million (EUR 6.0
million). Significant fluctuations in revenue
• Advisor to the owners of Pisla Oy regar-
ding the sale of the company to Volani AB
• Advisor to the PHM Group, backed by
Norvestor and Intera, concerning add-on
acquisitions in Sweden
• Advisory to the owners of IM Röntgen on
the sale of the company to Capio
• Nordic Capital’s advisor on the sale of
Gina Tricot to Frankenius Equity
• Agile Content’s advisor on the public offer
for Edgeware AB
• Advisory to the owners of Svefa Holding
AB on the sale to Broviken Gruppen
Incentive plans
The incentive plan business grew to an even
more important strategic growth area for Evli
as a result of the corporate transaction that
took place in the fall. In the transaction, Ale-
xander Incentives Oy, Finland’s leading plan-
ner of share-based incentive systems, merged
with Evli’s subsidiary, Evli Awards Management
Oy. As a result of the merger, Evli offers incen-
tive plans throughout the value chain, from
planning to administration and implementa-
tion. Evli holds a leading position in Finland in
this business among listed companies.
At the end of 2020, the company managed
over 80 incentive plans, of mainly Finnish com-
panies. In addition, the company acted as an
advisor to about 100 companies in reward-re-
lated planning during the year.
Evli’s strategic objective is to expand the cur-
rent product and service offering related to
incentive plans to foreign and unlisted compa-
nies. During the year, the focus was especially
on international sales. The company gained
a total of about ten new Nordic and unlisted
companies as clients during 2020.
Net assets under management
December 31, 2020 (EUR bn.)
Discretionary asset management
Mutual funds
Alternative investment funds
Northern Horizon Capital A/S
Evli Alexander Incentives Oy
Evli Bank Plc Northern Horizon Capital A/S Evli Alexander Incentives Oy
from one quarter to the next are typical of the
segment’s M&A activities.
During 2020 Evli acted as advisor in among
others the following transactions:
• Lifvis Ab’s advisor in the company’s suc-
cessful financing round
• Luci Intressenter AB’s advisor in the public
tender offer of LightLabSweden Ab
• The Swedish listed company Haldex advi-
sor in a SEK 1.3 billion refinancing, inclu-
ding a SEK 157 million share issue
• The listed company Eltel’s advisor in a
EUR 150 million refinancing
• Advisor to the private owners in the sale
of the life science company Laroda to the
English company Associated British Foods
• Advisor to the Board of Directors of the
Finnish company M-Brain regarding the
company’s refinancing.
Net Assets Under Management EUR 14.1 bn.
0
2,0
4,0
6,0
8,0
10,0
12,0
14,0
16,0
2011
2012
2013
2014
2015
2016
2017
2018
2019
12.31.2020
5.2
6.1
1.1
1.0
0.7
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
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FINANCIAL REVIEW
261 persons
EMPLOYEE FACTS
Employees per country
261 persons
Employees per segment
Wealth Management and Investor Clients 61%
Advisory and Corporate Clients 20%
Group Operations 18%
Finland 94%
Sweden 6%
Arab Emirates 0.4%
The incentive business’s revenue for the review
period was EUR 5.9 million (EUR 4.6 million).
Revenue growth was positively affected mainly
by the increase in the number of client compa-
nies compared to the comparison period and
the lower-than-expected impact of the coro-
navirus pandemic on the amount of transac-
tion-based fees.
Financial performance
In 2020 the net revenue of the Advisory and
Corporate Clients segment decreased eleven
percent year on year totalling EUR 9.7 million
(EUR 10.9 million).
Group Operations
The Group Operations segment includes sup-
port functions serving the business areas, such
as Information Management, Financial Admin-
istration, Marketing, Communications and
Investor Relations, Legal Department, Human
Resources, and Internal Services. Banking ser-
vices and the company’s own investment oper-
ations that support the company’s operations,
and the Group’s supervisory functions; Com-
pliance, Risk Management and Internal Audit,
are also part of Group Operations.
Financial performance
In 2020 the return of the Group operations seg-
ment decreased year on year and was EUR 2.8
million (EUR 3.6 million). The decrease was due
Split of advisory commissions 2020
Advisory fees
Incentive management
Other advisory fees
34%
5%
61%
Personnel
The group had 261 employees (249) at the
end of December. The number of employees
increased by five percent, from the previous
year. The growth was due to, among other
things, the merger with Alexander Incentives
Oy. Approximately 94 percent of the person-
nel were employed in Finland and six percent
abroad.
Corporate responsibility
Evli has raised responsibility to one of its stra-
tegic focus areas. Responsibility factors have
been integrated into investment operations
in Evli’s most significant business area, Wealth
Management, which means that responsib-
le investment is a systematic part of portfo-
lio management. Investments made by Evli’s
mutual funds are also monitored for possib-
le norm violations, and Wealth Management
engages with companies independently and
together with other investors.
Evli’s successful work in the area of responsib-
le investment was again awarded with excel-
lent ratings during the year in external assess-
ments. In an international comparison, the UN’s
umbrella organization for responsible invest-
ment PRI awarded Evli its highest rating (A+)
in the Responsible Investment Strategy and
Governance category. In the KANTAR SIFO
Prospera External Asset Management Finland
2020 survey, Evli was ranked best in responsib-
to unrealized losses on fixed income invest-
ments in the own balance sheet caused by the
market turmoil.
Development of advisory commissions
M€
0,0
2,0
4,0
6,0
8,0
10,0
12,0
8.7
1.3 0.0 9.7
-2.5
12/2019 level
M&A transactions
Incentive plans
Others
12/2020 level
KEY FIGURES - ADVISORY AND CORPORATE CLIENTS SEGMENT
M€ 2020 2019 Change %
Net revenue 9.7 10.9 -11%
Operating profit/loss before Group allocations 2.7 4.0 -33%
Operating profit/loss 1.8 2.8 -37%
Number of personnel 53 44 6%
KEY FIGURES – GROUP OPERATIONS SEGMENT
M€ 2020 2019 Change %
Net revenue 2.8 3.6 -21%
Operating profit/loss before Group allocations -6.7 -8.4 -20%
Operating profit/loss 0.0 0.3 -95%
Number of personnel 48 51 -6%
GOVERNANCE
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FINANCIAL REVIEW
le investment in Finland for the fourth consec-
utive year.
Additional information about responsibility
and responsible investing in 2020 on pages
14-41.
Evli’s shares and share capital
At the end of the year, Evli Bank Plc’s total
number of shares was 24,109,420, of which
14,635,264 were series A shares and 9,474,156
were series B shares. The company held
328,998 series B shares. The company’s share
capital was EUR 30,194,097.31 at the end of
the year. No changes took place in the share
capital.
At the end of the year, Evli had 9,474,156 B
shares subject to public trading on Nasdaq
Helsinki Ltd. Trading in the shares in Janu-
ary-December came to EUR 24.7 million, with
2,465,545 Evli shares traded. The closing price
at the end of December was EUR 12.20. The
highest share price during the year was EUR
13.20 and the lowest was EUR 6.80. Evli’s mar-
ket capitalization was EUR 294.1 million at the
end of December. The market capitalization
is calculated based on both unlisted A shares
and listed B shares.
A shares are valued at the closing value of the
B share at the end of the reporting period.
Additional information on major shareholders,
shareholder allocation, ownership by owner
group and information on share-based key fi-
gures on pages 52-54, Shares and shareholders.
Decisions taken by the annual general
meeting
Evli Bank Plc’s Annual General Meeting was
held in Helsinki on March 9, 2020. The meeting
of Directors. Henrik Andersin, Fredrik Hack-
lin, Sari Helander, Robert Ingman, Mikael Li-
lius and Teuvo Salminen were re-elected to
Evli Bank Plc’s Board of Directors. The mee-
ting attendance fee payable to Board mem-
bers is EUR 5,000.00 per month, and the
attendance fee payable to the Chairmen of the
Committees is EUR 6,000.00 per month. The
meeting attendance fee payable to the Chair-
man of the Board is EUR 7,500.00 per month.
PricewaterhouseCoopers Oy, an auditing
firm, was elected as the auditor, with Jukka
Paunonen, Authorized Public Accountant, as
the principally responsible auditor. The auditor
is paid remuneration according to a reasonab-
le invoice approved by the company.
The Annual General Meeting authorized the
Board of Directors to decide on the repurchase
of the company’s own series A and series B
shares in one or more lots as follows:
The total number of own series A shares to be
repurchased may be a maximum of 1,516,088
shares, and the total number of own series B
shares to be repurchased may be a maximum
of 874,055 shares. The number of shares rep-
resents approximately ten percent of all the
shares of the company on the date of the
Notice of the Annual General Meeting.
Based on the authorization, the company’s
own shares may only be repurchased with
unrestricted equity.
The company’s own shares may be repur-
chased at the price formed for series B shares
in public trading or at the price otherwise
formed on the market on the purchase day.
The Board of Directors will decide how the
company’s own shares will be repurchased.
Financial instruments such as derivatives may
be used in the purchasing. The company’s own
shares may be repurchased in other proportion
than the shareholders’ proportional sharehol-
dings (private purchase). Shares may be repur-
chased through public trading at the prevailing
market price formed for the B-shares in public
trading on the Nasdaq Helsinki Oy on the date
of repurchase.
The authorization will replace earlier unused
authorizations to repurchase the company’s
own shares. The authorization will be in force
until the next Annual General Meeting but no
later than until June 30, 2021.
The Annual General Meeting authorized the
Board of Directors to decide on the issuance
of shares and special rights entitling to shares
pursuant to chapter 10, section 1, of the Com-
panies Act in one or more lots, for a fee or free
of charge.
Based on the authorization, the number of
shares issued or transferred, including shares
received based on special rights, may total a
maximum of 2,390,140 series B shares. The
number of shares represents approximately
ten percent of all the shares of the company
on the date of the Notice of the Annual Ge-
neral Meeting. Of the above-mentioned total
number, however, a maximum of 239,014
shares may be used as part of the company’s
share-based incentive schemes, representing
approximately one percent of all the shares of
the company on the date of the Notice of the
Annual General Meeting.
The authorization will entitle the Board of
Directors to decide on all the terms and con-
ditions related to the issuing of shares and
special rights entitling to shares, including
the right to deviate from the shareholders’
pre-emptive subscription rights. The Board
of Directors may decide to issue either new
adopted the financial statements and resolved
in accordance with the proposal of the Board
of Directors to pay EUR 0.66 per share in divi-
dends. The dividend was paid to a shareholder
who on the record date March 11, 2020 was
registered in the shareholders’ register of the
company held by Euroclear Finland Ltd. The
date of the payment of dividends was resolved
to be March 18, 2020. In addition, the Annual
General Meeting granted release from liability
to the Members of the Board of Directors and
the CEO for the 2019 financial year.
The Annual General Meeting approved the
remuneration policy for governing bodies and
decided that the amount of variable remuner-
ation paid to a person employed by Evli may
exceed 100 percent of the total fixed annual
remuneration of the person, subject to the
conditions described below. However, the
variable remuneration component shall not
exceed 200 percent of the total annual fixed
remuneration of the recipient. An individual’s
short-term (one-year earnings criterion) vari-
able remuneration may not exceed 100 per-
cent of an individual’s annual fixed remunera-
tion. However, the combination of short-term
variable remuneration and long-term commit-
ment plan payments may exceed 100 percent
of the individual’s annual fixed remuneration.
However, the aggregate of short-term variab-
le remuneration and long-term commitment
plan payments may not exceed 200 percent
of the individual’s annual fixed remuneration.
The maximum variable remuneration applies
to the remuneration of approximately 30 per-
sons, that is, senior management and certain
key personnel. The variable remuneration is
not used to compensate the Board of Direc-
tors. The maximum variable remuneration
applies until further notice.
The Annual General Meeting confirmed six
as the total number of members of the Board
GOVERNANCE
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FINANCIAL REVIEW
shares or any own shares in the possession of
the company.
The authorization will replace earlier unused
authorizations concerning the issuance of
shares as well as the issuance of options and
other special rights entitling to shares. The
authorization will be in force until the end
of the next Annual General Meeting but no
longer than until June 30, 2021.
Changes in group structure
In June, Evli sold three percent of its shares in
Evli Corporate Finance Ab to its employees.
Following the transaction, Evli’s ownership in
the company is 56.5 percent.
In August, Evli bought 35 percent of Terra
Nova Capital Advisors Ltd shares from the
company’s employees. Following the trans-
action, Evli’s ownership in the company is 90
percent.
In September, Evli Bank Plc and the owners
of Alexander Incentives Oy signed an agree-
ment on the exchange of shares between Evli
Awards Management Oy (“EAM”) and Alex-
ander Incentives Oy, in which EAM gained 100
percent of the shares of Alexander Incentives
Oy. As a consideration, EAM issued new own
shares so that the minority interest in the com-
pany’s shares rose to 35 percent. Evli Bank’s
holding in the company is 65 percent.
Business environment
Despite the recovery of the investment mar-
kets, Evli’s business environment faces many
challenges. Political uncertainty in the USA and
the potential consequences and impacts of the
second wave of the coronavirus on national
economies may cause significant fluctua-
tions in the investment markets. Investors’ risk
appetite and investment interest has, however,
increased as a result of the market recovery
supported by governments and central banks.
During the spring, the coronavirus pandemic
led to a sudden crash in the equity and bond
markets. However, the markets recovered
quickly supported by strong stimulus. If the
coronavirus pandemic prolongs, it may also be
reflected in a reduction in the value of alter-
native investment products, such as office
property funds. If this happens, it could make
the sale of such products more difficult. Evli
already has a strong position among institu-
tions and high-net-worth individuals. Despite
the challenging market environment, the con-
ditions for the growth of the core business in
the company’s domestic market in Finland are
good, especially with the expanded product
range.
In line with its strategy, Evli has focused
increasingly on international sales and deve-
loping alternative investment products. These
are considered important sources of growth for
the company and a means to further diversify
the company’s sources of revenue. Work has
also been done to achieve even better busi-
ness scalability, as a result of which an indicator
critical to the company, the ratio of recurring
revenue to operating costs, has developed
favourably.
The company focuses its international growth
on the Nordic and European markets. In addi-
tion to product availability, the streamlining
and adaptation of administrative processes
and structures to correspond to the standards
that investors are accustomed to on other mar-
kets are critical for the success of international
growth. Evli is excellently placed where inter-
national sales are concerned, and the image of
a high-quality Nordic fund management bou-
tique is of interest to foreign investors. Never-
theless, as a consequence of the coronavirus
pandemic the market environment is currently
exceptionally challenging in terms of interna-
tional growth.
Alternative investment products are another
important strategic focus area for Evli. The
company’s goal is to be able to offer a com-
prehensive product selection from typical,
very liquid fixed income funds to more exotic
real interest rate and private equity funds. To
achieve this goal, Evli has launched several
new products and will further expand its offer-
ing to new asset classes. There is considerable
competition on the Finnish market in the area
of alternative investment products. Despite
the challenges arising from the operating envi-
ronment, Evli’s objective is to turn alternative
investment products into a major source of re-
venue, with the help of a comprehensive selec-
tion and exceptional expertise.
Risk management and business risks
Evli’s most significant near-term risk is the
impact of market performance on the compa-
ny’s business functions. Securities market per-
formance has a direct impact on the wealth
management business. Its revenue is based on
the performance of assets under management
and is therefore subject to market fluctuations.
The general performance of the markets also
has an impact on brokerage operations. In
advisory assignments, any changes in the
market confidence of investors and corporate
management may result in the lengthening or
termination of projects.
Evli’s most significant risks associated with its
bank and investment activities are liquidity,
market and interest rate risks. These risks are
controlled with limits set by Evli Bank’s Board
of Directors. The limits are constantly moni-
tored. The basis for investments made by the
company is that they must not endanger Evli’s
result or solvency. Evli’s investments are very
highly diversified, and dependency on a sing-
le company is restricted by limiting the size of
company-specific investments, for example.
Regardless of good monitoring, there is always
a certain degree of risk involved in investment
activities, which means the return from invest-
ment activities can fluctuate significantly from
one quarter to the next.
Outlook for 2021
We estimate that the operating profit for 2021
will be clearly positive.
The view is supported by a high ratio of recur-
ring revenue to operating costs, as well as
sales of alternative investment products, which
have brought new, stable revenue.
Helsinki, February 8, 2021
EVLI BANK PLC
Board of Directors
GOVERNANCE
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FINANCIAL REVIEW
Share price development (series B share) and trading volume 2.12.2015-31.12.2020
Monthly turnover, pcs
Price, EUR
Share price development Evli series B share Trading volume per month, Nasdaq Helsinki
14.0
12.0
10.0
8.0
6.0
4.0
2.0
0
12/2015
1/2016
2/2016
3/2016
4/2016
5/2016
6/2016
7/2016
8/2016
9/2016
10/2016
11/2016
12/2016
1/2017
2/2017
3/2017
4/2017
5/2017
6/2017
7/2017
8/2017
9/2017
10/2017
11/2017
12/2017
1/2018
2/2018
3/2018
4/2018
5/2018
6/2018
7/2018
8/2018
9/2018
10/2018
11/2018
12/2018
1/2019
2/2019
3/2019
4/2019
5/2019
6/2019
7/2019
8/2019
9/2019
10/2019
11/2019
12/2019
1/2020
2/2020
3/2020
4/2020
5/2020
6/2020
7/2020
8/2020
9/2020
10/2020
11/2020
12/2020
600,000
500,000
400,000
300,000
200,000
100,000
0
Shares and Shareholders’ Equity
Evli Bank has two series of shares, the A and B
series. One series A share entitles the holder
to twenty (20) votes and one series B to one (1)
vote at the General Meeting. The two series
of shares have equal rights to dividends and
other forms of profit distribution. The Compa-
ny’s series B share is listed on the official list of
Nasdaq Helsinki with the ticker symbol “EVLI”
and ISIN code FI4000170915.
At the end of December 2020, the aggregate
number of Evli’s shares was 24,109,420, with
the series A shares accounting for 14,635,264
shares and series B shares for 9,474,156 shares.
The company held 328,998 of its own series
B shares. At the end of 2020, the compa-
ny’s share capital amounted to 30,194,097.31
euro. The share capital remained unchanged
throughout the year.
Trading in shares
At the end of December 9,474,156 of Evli’s
series B shares were publicly traded in Nas-
daq Helsinki. The share exchange between
January and December totalled 24.7 million
euro while the number of Evli shares exchan-
ged was 2,465,545. During 2020, the highest
trading price of the share was EUR 13.20 while
the lowest price was EUR 6.80. The share’s clo-
sing price on December 31, 2020 was EUR
12.20. Evli’s market capitalisation, calculated
based on both the unlisted series A and the
listed series B shares, was EUR 294.1 million
on December 31, 2020. The series A shares are
valued at the review year closing price of the
series B shares.
Shareholders
At the end of 2020, Evli had 5,172 (4,204) share-
holders in the book-entry register. The stake of
Finnish companies was 55 percent (54%) and
that of private Finnish individuals was 27 per-
cent (26%). The remaining 18 percent of the
shares (20%) were owned by Financial and
insurance institutions, public sector organi-
zations, non-profit institutions serving house-
holds and foreign investors.
Shares and Shareholders’
(2019: 248.6)
Market capitalisation, M€
294.1
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 52 | 149
FINANCIAL REVIEW
LARGEST SHAREHOLDERS A Shares B Shares Shares total % of all shares % of votes
1. Oy Scripo Ab 3,803,280 950,820 4,754,100 19.7 25.5
2. Prandium Oy Ab 3,803,280 950,820 4,754,100 19.7 25.5
3. Oy Fincorp Ab 2,319,780 420;991 2,740,771 11.4 15.5
4. Ingman Group Oy Ab 1,860,000 650,000 2,510,000 10.4 12.5
5. Lehtimäki Maunu 533,728 171,031 704,759 2.9 3.6
6. Hollfast John Erik 328,320 82,080 410,400 1.7 2.2
7. Tallberg Claes 369,756 32,588 402,344 1.7 2.5
8. Moomin Characters Oy Ltd 0 396,351 396,351 1.6 0.1
9. Evli Bank Plc 0 328,998 328,998 1.4 0.1
10. Svenska Litteratursällskapet i Finland 0 220,336 220.336 0.9 0.1
BREAKDOWN OF SHAREHOLDINGS
BY OWNER GROUP
Number of
shareholders
Proportion of
shareholders, %
Number
of shares
Proportion
of shares, %
Number
of votes
Proportion
of votes, %
Companies 219 4.2 12,995,043 53.9 192,859,683 63.8
Financial and insurance institutions 22 0.4 3,573,367 14.8 48,141,932 15.9
Public sector organizations 2 0.0 182,288 0.8 182,288 0.1
Households 4,886 94.5 6,372,768 26.4 60,502,324 20.0
Non-profit institutions 21 0.4 373,854 1.6 373,854 0.1
Foreigners 22 0.4 103,672 0.4 119,355 0.0
Total 5,172 100.0 24,109,420 100.0 302,179,436 100.0
of which nominee registered 10 508,428 2.1 508,428 0.2
Number of shares issued 24,109,420 100.0 302,179,436 100.0
BREAKDOWN OF SHAREHOLDINGS
BY SIZE CLASS
Number of
shareholders
Proportion of
shareholders, %
Number
of shares
Proportion
of shares, %
Number
of votes
Proportion
of votes, %
1-100 1,871 36.2 92,446 0.4 92,446 0.0
101-1.000 2,756 53.3 898,024 3.7 908,170 0.3
1.001-10.000 456 8.8 1,255,773 5.2 1,555,973 0.5
10.001-100.000 63 1.2 2,167,258 9.0 12,907,806 4.3
100.001-500.000 21 0.4 4,232,189 17.6 37,170,019 12.3
500.001- 5 0.1 15,463,730 64.1 249,545,022 82.6
Total 5,172 100.0 24,109,420 100.0 302,179,436 100.0
of which nominee registered 10 508,428 2.1 508,428 0.2
Number of shares issued 24,109,420 100.0 302,179,436 100.0
Breakdown of shareholdings
by owner group
Breakdown of votes
by owner group
24,109,420
302,179,436
Companies: 53.9%
Financial and insurance institutions: 14.8%
Public sector organizations: 0.8%
Households: 26.4%
Non-profit institutions: 1.6%
Foreigners: 0.4%
Nominee registered: 2.1%
Companies: 63.8%
Financial and insurance institutions: 15.9%
Public sector organizations: 0.1%
Households: 20.0%
Non-profit institutions: 0.1%
Foreigners: 0.0%
Nominee registered: 0.2%
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 53 | 149
FINANCIAL REVIEW
Authorisations given to the
Board of Directors
The Annual General Meeting on March 9, 2020
authorized the Board of Directors to decide on
the repurchase of the company’s own series A
and series B shares in one or more lots. The
total number of own series A shares to be
repurchased may be a maximum of 1,516,088
shares, and the total number of own series B
shares to be repurchased may be a maximum
of 874,055 shares. The proposed number of
shares represents approximately ten percent
of all the shares of the company’ on the date
of the Notice of the Annual General Meeting.
The authorisation remains in force until the fol-
lowing Annual General Meeting, however, no
longer than until June 30, 2021. In 2020 Evli did
not acquire any own shares.
Evli’s series A shares can be converted into
series B shares under Article 4 of the Articles
of Association. During 2020, the company
converted A shares into B shares as follows:
• 145,224 A shares were converted into B
shares on April 24, 2020. Public trading with
the converted shares began at Nasdaq Hel-
sinki Ltd on April 27, 2020.
• 375,387 A shares were converted into B
shares on September 11, 2020. Public tra-
ding with the converted shares began at
Nasdaq Helsinki Ltd on September 14,
2020.
• 5,000 A shares were converted into B shares
on December 18, 2020. Public trading with
the converted shares began at Nasdaq Hel-
sinki Ltd on December 21, 2020.
Option and share-based incentive
programs
Evli’s has three share-based incentive pro-
grams established in 2017, 2018 and 2019. The
rewards based on the incentive program are
given in Evli shares. Further information on the
incentive program on the web page www.evli.
com/investors and Note 1.8. Employee bene-
fits as well as from the remuneration report on
pages 140-142.
Share ownership of executives
The share ownership of the Board members
of Evli Bank Plc, including the holdings in the
controlled corporations, were 7,382,310 shares
in total on December 31, 2020, accounting for
30.6 percent of the total shares and 38.1 per-
cent of voting rights. The members of the
Board of Directors of Evli Bank Plc held no
stock options.
At year-end, CEO Maunu Lehtimäki owned
704,759 shares which is 2.9 percent of the
shares and 3.6 percent of the voting rights.
Moreover, he has been allocated 50,000 Evli
shares in the context of the share-based incen-
tive program established in 2019.
At year-end, other members of Evli Group’s Exe-
cutive Group owned 728,195 shares in aggregate,
corresponding to 3.0 percent of the total shares
and 2.4 percent of the voting rights. In addition,
the Executive Group was allocated 18,400 Evli
shares in the context of the share-based incen-
tive program established in 2017 and 28,002 Evli
shares in the context of the share-based incen-
tive program established in 2018 and 140,000 Evli
shares in the context of the share based incentive
program established in 2019.
CHANGES IN THE SHARE CAPITAL, BOARD AUTHORIZATIONS AND OPTION PROGRAMS
Number of own
shares held
Number of
outstanding
shares
Share capital,
M€
Share premium
fund, M€
Fund of invested
non-restricted
equity, M€
1.1.2019 375,387 23,313,533 30.2 1.8 18.3
Aquisition of own shares 0 0 0.0 0.0 0.0
Option rights subscription (option program 2014) 0 212,500 0.0 0.0 0.4
Aquisition of minority interest 0 0 0.0 0.0 0.0
31.12.2019 375,387 23,526,033 30.2 1.8 18.7
Total number of shares 23,901,420
1.1.2020 375,387 23,526,033 30.2 1.8 18.7
Aquisition of own shares 0 0 0.0 0.0 0.0
Option rights subscription (option program 2014) -46,389 254,389 0.0 0.0 1.5
Aquisition of minority interest 0 0 0.0 0.0 2.7
31.12.2020 328,998 23,780,422 30.2 1.8 22.8
Total number of shares 24,109,420
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 54 | 149
FINANCIAL REVIEW
Annual General Meeting
9.3.2021
Basic share information
Evli Bank has two share series, series A shares
and series B shares. A series A share confers
twenty (20) votes and a series B share con-
fers one (1) vote at the General Meeting. The
share series have identical entitlements to
dividends and other profit sharing. The com-
pany’s series B shares are listed on the offi-
cial list of Nasdaq Helsinki with the ticker
symbol “EVLI” and ISIN code FI4000170915.
• A shares (December 31, 2020): 14.635.264
• B shares (December 31, 2020): 9.474.156.
Investor calendar 2021
• Annual report and financial statements for
the financial year 2020: week 7
• Final registration date for voting at the
Annual General Meeting: March 2, 2021 at
4.00 pm.
• Annual General Meeting (AGM), Helsinki:
March 9, 2021
• Silent period: March 17-April 15, 2021
• The interim report for January-March 2021,
published on April 15, 2021
• Silent period: June 15-July 14, 2021
• The half-year financial report for Janu-
ary-June 2021, published on July 14, 2021
• Silent period: September 21-October 20,
2021
• The interim report for January-September
2021, published on October 20, 2021.
Evli’s financial reports as well as stock exchange
and press releases are published in Finnish
Information to shareholders
and in English. Evli’s stock exchange releases
and press releases can be subscribed to at
www.evli.com/investors.
Annual General Meeting of shareholders
The Annual General Meeting (AGM) of Evli
Bank Plc will be held on Tuesday, March 9,
2021. The meeting will be held in accordance
with the provisions of the temporary legislation
approved by the Finnish Parliament on Sep-
tember 15, 2020 (677/2020, Act on temporary
deviation from the Limited Liability Companies
Act) without the physical presence of share-
holders and their proxy representatives.
The notice to the AGM and the Board’s pro-
posals to the AGM are published as a stock
exchange release and on www.evli.com. The
notice lists the matters to be discussed at the
AGM. A shareholder has the right to request
on the agenda of the annual general meeting
an item that falls within the competence of the
general meeting by virtue of the Limited Lia-
bility Companies Act, provided that the share-
holder demands so in writing from the Board
of Directors, well in advance of the meeting,
so that the item can be added in the notice
of the annual general meeting. In accordance
with the Act on temporary deviation from the
Limited Liability Companies Act a decision
proposal may be included in the AGM agenda
provided that the shareholders having submit-
ted the proposal hold at least one percent of
all the shares in the company.
Registration and voting
A shareholder wishing exercise the right to
vote on matters to be discussed at the AGM
must register as a participant by March 2, 2021.
Additional information about the registration
at www.evli.com/agm
Proposed distribution of dividends
The Board proposes to the AGM a dividend of
a maximum of EUR 0.73 per share be paid for
series A and B shares, totalling approximately
EUR 17.4 million. It is proposed that the Annual
General Meeting would authorize the Board
of Directors to decide on the payment of the
dividend in one or more instalments at a time
it deems best, taking into account the current
authority recommendations.
Evli’s investor communications
The main channel for Evli’s investor commu-
nications is the company’s website, where
the company publishes all its stock exchange
releases and press releases, its interim reports,
financial statements, annual reports and Gene-
ral Meeting notices. The website also has pres-
entations related to the reporting of results for
investors and analysts, an investor calendar,
and information intended for shareholders and
analysts about the company’s shares, financial
performance, ownership and Corporate Gov-
ernance. www.evli.com/investors.
Contact information
Juho Mikola
CFO
Tel. +358 40 717 8888
Mikaela Herrala
Head of Marketing,
Communication & IR
Tel. +358 50 544 5740
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 55 | 149
FINANCIAL REVIEW
Capital adequacy
(2019: 15.1)
Capital adequacy ratio, %
15.2
As of January 1, 2014, capital adequacy has
been calculated according to the Basel III
standards. The term Basel III is used in the
financial statements to mean the EU’s Capital
Requirements Regulation 575/2013 and the
related additional regulations issued by the
European supervisory authority and interna-
tional supervisory authorities.
COMMON EQUITY TIER 1 CAPITAL, M€ 2020 2019
Own funds include share capital, funds and retained earnings. These items
are not subject to special terms.
Common equity tier 1 capital
Share capital 30.2 30.2
Funds total and retained earnings 40.3 32.7
Minority interest 0.0 0.0
Decreases:
Intangible assets 16.0 14.3
Other decreases 0.0 0.0
Total common equity tier 1 capital 54.5 48.6
Based on the capital adequacy disclosure requirements (CRR article 431), the following required additional
disclosures are presented in the financial statements in the following sections:
• Exposure to counterparty credit risk: Notes on risk position/ Credit Risk (counterparty risk)
• Credit risk adjustments: Notes on risk position/ General information on credit and dilution risk (standard
model) and Techniques to reduce credit risk.
• Use of ECAIs: Notes on risk position/ General information on credit and dilution risk (standard model)
• Exposure to market risk: Notes on risk position/ Market risk
• Operational risk: Notes on risk position/ Operational risk
• Exposures in equities not included in the trading book: Notes on risk position/ Shares outside the trading book.
• Risk management objectives and policies: Risk management and internal control
• Unencumbered assets: Notes to balance sheet/ Assets pledged as collateral and other commitments
• Exposure to interest rate risk on positions not included in the trading book:
Risk management and internal control
• Remuneration policy: Governance / Renumeration policy
• Leverage: Risk management and internal control
• Capital requirements, adequacy of internal capital: Risk management and internal control.
MINIMUN REQUIREMENT OF OWN FUNDS
Minimun capital adequacy requirement by asset group,
standard credit risk method
Own funds
min.
requirement
Risk-
weighted
value
Exposure
value after
credit risk
deductions
Claims from the state and central banks 0.0 0.0 332.2
Claims from regional governments and local authorities 0.0 0.0 8.0
Claims from credit institutions and investment firms 2.8 35.0 152.3
Investments in mutual funds 4.1 50.7 50.7
Claims secured with property 0.1 1.1 3.1
Claims from corporate customers 2.5 30.9 34.5
Items with high risk, as defined by the authorities 0.1 1.3 0.9
Other items 7.7 95.8 95.8
Total 17.2 214.8 677.6
Minimum amount of own funds, market risk 0.5 5.8 0.0
Risk-weighted receivables, investments and off-balance
sheet obligations, total 17.7 220.6 677.6
Minimum amount of own funds, operational risk 11.1 138.9 0.0
Total 28.8 359.6 677.6
EVLI GROUP´S CAPITAL ADECUACY 2020 2019 2018 2017 2016
Own assets (common equity Tier 1 capital), M€ 54.5 48.6 48.8 43.0 45.7
Risk-weighted items total for market- and credit risks, M€ 220.6 188.1 177.3 166.9 184.8
Operational risk, capital requirement 11.1 10.7 9.9 9.6 9.0
Capital adequacy ratio, % 15.2 15.1 16.2 15.0 15.3
Evli Bank Plc:s adequacy ratio, % 18.7 19.1 18.8 20.4 20.7
Own funds surplus M€ 25.8 22.8 24.8 20.0 21.8
Own funds in relation to the minimum capital requirement 1.9 1.9 2.0 1.9 1.9
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 56 | 149
FINANCIAL REVIEW
Calculation of key ratios
Sales
Net interest income + commission income + net income from
securities transactions and foreign exchange dealing + other
operating income.
Net revenue
From Income Statement. Includes gross returns, deducted by
interest and commission expenses.
Operating profit/loss From Income Statement.
Profit for the
financial year
From Income Statement.
Return on equity
(ROE), %
=
Profit / Loss for financial year
x 100
Equity capital and minority interest (average of the figures
for the beginning and at the end of the year)
Return on assets
(ROA), %
=
Profit / Loss for financial year
x 100
Average total assets (average of the figures for the beginning
and at the end of the year)
Equity ratio, % =
Equity incl. non-controlling interest’s share of equity
x 100
Average balance total
Expense/income
ratio
=
Administrative expenses + depreciation and impairment
charges + other operating expenses
Net interest income + net commission income + net income
from securities transactions and foreign exchange dealing +
other operating income
Comprehensive
Earnings per Share
(EPS), fully diluted
=
Comprehensive income for the year after taxes attributable
to the shareholders of Evli Bank Plc
Average number of shares outstanding including issued
shares and option rights
Earnings per Share
(EPS), fully diluted
=
Profit for the year after taxes attributable to the
shareholders of Evli Bank Plc
Average number of shares outstanding including issued
shares and option rights
Group´s capital
adecuacy (CET1), %
=
Group assets (common equity Tier 1 capital)
x 100
Risk-weighted items total
Equity per share =
Equity attributable to the shareholders of Evli Bank Plc
Number of shares at the end of the year
Recurring revenue to
operating costs ratio
=
All revenues that are not transaction based but time dependant*
All operative expenses excluding reservation for bonuses from
review period
*Asset management, fund fees, administration of incentive
systems, research, custody and client net interest fees
Earnings per Share
(EPS)
=
Profit for the year after taxes attributable to the shareholders
of Evli Bank Plc
Average number of shares outstanding
Net revenue per
employee
=
Net revenue
Number of personnel during the period, avarage
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 57 | 149
FINANCIAL REVIEW
Financial statements 1.1.-31.12.2020
Contents
Consolidated comprehensive income statement ................................59
Consolidated balance sheet ..................................................................60
Consolidated statement of cash ow ...................................................61
Consolidated statement of changes in equity .....................................62
Notes to the consolidated nancial statements ..............................63
Risk management and internal control .............................................69
1. Notes to the consolidated income statement ............................74
1.1. Interest income ................................................................................74
1.2. Interest expenses .............................................................................74
1.3. Commission income ........................................................................75
1.4. Commission expenses ....................................................................76
1.5. Net income from securities transactions
and foreign exchange dealing ..............................................................76
1.6. Income from equity investments ....................................................76
1.7. Other operating income .................................................................76
1.8. Personnel expenses .........................................................................76
1.9. Other expenses ...............................................................................79
1.10. Other operating expenses ...........................................................79
1.11. Depreciation, amortization and impairment losses ....................79
1.12. Expected credit losses on loans and other commitments
and impairment losses on other nancial assets .................................79
1.13. Share of prot or loss of associate companies ............................79
1.14. Income taxes ..................................................................................80
1.15. Earnings per share (EPS) ...............................................................80
2. Notes to the consolidated balance sheet ....................................81
2.1. Cash and cash equivalents..............................................................81
2.2. Claims on credit institutions ...........................................................81
2.3. Claims on the public and public sector entities by sector ...........81
2.4. Debt securities .................................................................................81
2.5. Shares and participations ................................................................82
2.6. Derivative contracts .........................................................................83
2.7. Intangible assets and goodwill .......................................................84
2.8. Property, plant and equipment ......................................................86
2.9. Other assets .....................................................................................87
2.10. Accrued income and prepayments ..............................................87
2.11. Deferred taxes ...............................................................................87
2.12. Liabilities to credit institutions and central banks .......................87
2.13. Liabilities to the public and public sector entities ......................87
2.14. Debt securities issued to the public ............................................87
2.15. Derivative contracts and other liabilities held for trading ..........88
2.16. Other liabilities ...............................................................................88
2.17. Accrued expenses and deferred income ....................................88
2.18. Deferred tax liabilities ...................................................................88
2.19. Equity capital .................................................................................88
3. Off-balance-sheet commitments ....................................................89
3.1. Off-balance sheet commitments ....................................................89
4. Segment reporting ...........................................................................90
4.1. Segment income statement ...........................................................91
4.2. Geographical income statement and balance sheet ...................91
5. IFRS 9 ..................................................................................................92
5.1. Evaluation of substantial increase in credit risk.............................92
5.2. Calculation model for expected credit losses ...............................92
5.3. Items measured according to IFRS 9, excepcted credit losses ...93
6. Notes on risk position .....................................................................94
6.1. General information on credit
and dilution risk (standard model) ........................................................94
6.2. Techniques to reduce credit risk ....................................................94
6.3. Credit risk (counterparty risk) ..........................................................95
6.4. Market risk ........................................................................................95
6.5. Operational risk ...............................................................................96
6.6. Shares outside the trading book ....................................................96
7. Other notes .......................................................................................97
7.1. Maturities of nancial assets and liabilities ...................................97
7.2. Assets and liabilities denominated
in domestic and foreign currency ..........................................................98
7.3. Value of nancial instruments across the three levels
of the fair value hierarchy .......................................................................99
7.4. Analysis of nancial instruments categorized in level 3 .............101
7.5. Unrealized prot/loss for nancial instruments
categorized in level 3 ...........................................................................102
7.6. Classication of nancial instruments ..........................................102
7.7. Liquidity Coverage Requirement (LCR) .......................................103
7.8. Securities lending ..........................................................................103
7.9. Fair values and book values of nancial
assets and nancial liabilities ...............................................................103
7.10. Assets pledged as collateral .......................................................104
7.11. Asset under Management ..........................................................104
8. Consolidation ..................................................................................105
General concolidation principles ........................................................106
8.1. Corporate structure .......................................................................105
8.2. Shares and participations in associates and joint ventures ........107
8.3. Changes in corporate structure ....................................................108
8.4. Related party disclosures ..............................................................108
8.5 Fees paid to auditors .................................................................... 108
9. Parent company’s nancial statements ......................................109
The gures in the nancial statement are presented in millions
of euros, unless indicated otherwise.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 58 | 149
FINANCIAL REVIEW
Liite 2020 2019
Operating expenses
Personnel expenses 1.8. -30.5 -30.4
Other administrative expenses 1.9. -12.5 -14.0
Impairment charges on goodwill 1.11. 0.0 0.0
Depreciation and amortization on tangibleand intangible assets 1.11. -5.7 -3.6
Other operating expenses 1.10. -1.7 -3.7
Excpected credit losses on loans and other receivables 1.12. -0.1 -0.1
Impairment losses on other nancial assets 1.12. 0.0 0.0
OPERATING PROFIT/LOSS 29.1 24.1
Share of prot or loss of associates 1.13. 0.4 -0.6
PROFIT BEFORE INCOME TAX 29.5 23.5
Income taxes 1.14. -6.3 -4.9
PROFIT / LOSS FOR THE FINANCIAL YEAR 23.2 18.7
Attributable to
Minority interest 1.3 1.4
Shareholders of parent company 21.9 17.3
PROFIT / LOSS FOR THE FINANCIAL YEAR 23.2 18.7
OTHER COMPREHENSIVE INCOME / LOSS
Items that are or may be reclassied subsequently to prot
or loss
Foreign currency translation differences - foreign operations 0.2 0.0
Other comprehensive income/loss 0.2 0.0
Other comprehensive income after taxes / loss for the year 0.2 0.0
OTHER COMPREHENSIVE INCOME / LOSS FOR THE YEAR 23.4 18.6
Attributable to
Non-controlling interest 1.3 1.4
Equity holders of parent company 22.1 17.2
Earnings / Share (EPS) 1.15. 0.90 0.73
Earnings / Share (EPS), fully diluted 1.15. 0.87 0.71
Diluted earnings / share IFRS, fully diluted 1.15. 0.88 0.71
Note 2020 2019
Interest income 1.1. 2.8 3.6
Interest expenses 1.2. -2.6 -3.2
NET INTEREST INCOME 0.2 0.3
Income from equity investments 1.6. 0.0 0.0
Fee and commission income 1.3. 79.9 74.1
Fee and commission expenses 1.4. -3.1 -1.9
Net income from securities transactions 1.5. 2.4 3.2
Other operating income 1.7. 0.2 0.1
NET REVENUE 79.7 75.8
Net revenue per
employee, K€
318
(2019: 294)
Accounting policies
Operating prot
IAS 1 Presentation of Financial Statements does not dene the concept of operating prot. The Group has
dened it as follows: operating prot is the net sum formed after employee benets expenses, other admi-
nistrative expenses, depreciation, amortization and possible impairment losses, and other operating expenses
are deducted from net revenue. All other items than the ones mentioned above are presented below operating
prot in prot or loss.
Earnings per share
Undiluted earnings per share are calculated by dividing the prot or loss attributable to the parent company’s
shareholders by the weighted average number of shares in circulation during the nancial period, excluding Evli
shares acquired and held by the Group during the period. Diluted earnings per share are calculated by adjusting
the weighted average number of shares by the dilutive effect of the stock options granted under share-based
incentive programs.
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FINANCIAL REVIEW
ASSETS Note 31.12.2020 31.12.2019
CASH AND EQUIVALENTS 2.1. 331.6 305.7
Financial assets measured at amortized cost
Claims on credit institutions 2.2. 66.8 69.8
Claims on the public and public sector entities 2.3. 109.6 114.0
FINANCIAL ASSETS MEASURED AT AMORTIZED COST 176.4 183.8
Leasing 9.6 4.9
Financial assets at fair value through prot or loss
Debt securities eligible for renancing with central banks 2.4. 37.2 36.1
Debt securities 2.4. 9.8 227.6
Shares and participations 2.5. 57.3 31.5
Derivative contracts 2.6. 52.2 59.6
FINANCIAL ASSETS AT FAIR VALUE
THROUGH PROFIT OR LOSS 156.3 354.8
Other than nancial assets
Shares and participations in associates 8.2. 4.2 3.8
Intangible assets and goodwill 2.7. 16.0 14.3
Property, plant and equipment 2.8. 1.4 1.6
Other assets 2.9. 73.7 50.4
Accrued income and prepayments 2.10. 3.3 3.6
Deferred tax assets 2.11. 0.1 0.2
OTHER THAN FINANCIAL ASSETS, TOTAL 98.8 74.0
TOTAL ASSETS 772.6 923.2
LIABILITIES AND EQUITY Liite 31.12.2020 31.12.2019
LIABILITIES
Financial liabilities at amortized cost
Liabilities to credit institutions and central banks 2.12. 0.7 1.9
Liabilities to the public and public sector entities 2.13. 385.2 551.6
Debt securities issued to the public 2.14. 131.1 148.6
FINANCIAL LIABILITIES AT AMORTIZED COST, TOTAL 517.0 702.1
Financial liabilities at fair value through prot or loss
Derivative contracts and other liabilities held for trading 2.15. 52.5 59.7
FINANCIAL LIABILITIES AT FAIR VALUE
THROUGH PROFIT OR LOSS 52.5 59.7
Other than nancial liabilities
Other liabilities 2.16. 84.4 58.0
Accrued expenses and deferred income 2.17. 23.3 21.7
Deferred tax liabilities 2.18. 0.0 0.0
OTHER THAN FINANCIAL LIABILITIES, TOTAL 107.7 79.7
TOTAL LIABILITIES 677.2 841.5
EQUITY 2.19.
Share capital 30.2 30.2
Share premium fund 1.8 1.8
Fund of invested non-restricted equity 22.8 18.7
Translation difference 0.2 0.0
Retained earnings 37.4 29.4
Minority interest 3.0 1.7
TOTAL EQUITY 95.4 81.8
Equity to holders of parent company 92.4 80.1
Non-controlling interest in capital 3.0 1.7
TOTAL LIABILITIES AND EQUITY 772.6 923.2
GOVERNANCE
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Accounting policies
Additional information to the cash ow statement
In the cash ow statement, the ows of cash and cash equivalents during the nancial year are
presented for all operations. The cash ow statement has been prepared in accordance with the
direct method, where cash inows and outows are reported primarily in gross terms. Cash ows
are classied as cash ows from operating activities, cash ows from investing activities and cash
ows from nancing activities.
Operating activities
Operating activities are the principal revenue-producing activities. Cash ows are primarily fees
and interest received, and payments to providers of goods and services and personnel. Changes
in operating assets and liabilities consist of assets and liabilities that are part of normal business
activities, such as loans, deposits and debt securities in issue. Pending transactions and changes
in the trading book are presented in net terms.
Investing activities
Cash ow from investing activities consists of investments in intangible rights such as software
licenses and client agreements, and payments related to mergers and acquisitions.
Financing activities
Financing activities include payments from equity items to shareholders, share issues and pay-
ments of leasing liabilities.
Cash and cash equivalents
Cash assets consist of cash, and loans to banks payable on demand.
2020 2019
Operating activities
Operating prot 29.1 24.1
Adjustment for items not included in cash ow 8.2 9.5
Income taxes paid -5.0 -5.2
Cash ow from operating activities before changes
in operating assets and liabilities 32.3 28.5
Changes in operating asset, total 170.5 -6.0
Changes in operating liablities, total -158.4 64.8
Cash ow from operating activities 44.5 87.2
Investing activities
Change in intangible asset -0.6 -5.7
Change in property, plant and equipment -0.2 -0.2
Cash ow from investing activities -0.9 -5.9
Financing activities
Dividends paid to company´s shareholders -15.3 -14.4
Dividends paid to non-controlling interests in subsidiaries -1.0 -0.7
Payment of nance lease liabilities -2.0 -2.7
Used option rights 1.5 0.4
Cash ow from nancing activities -16.8 -17.4
Cash and cash equivalents at the beginning of period 311.4 247.4
Cash and cash equivalents at the end of year 338.2 311.4
Change 26.8 64.0
GOVERNANCE
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FINANCIAL REVIEW
Share capital
Share premium
fund
Reserve for
invested
unrestricted
equity
Retained
earnings Total
Non-controlling
interest Total Equity
Equity 31.12.2018 30.2 1.8 18.3 26.0 76.3 1.1 77.4
Translation difference 0.0 0.0 0.0
Prot/loss for the period 17.2 17.2 1.4 18.7
Dividends -14.4 -14.4 -1.1 -15.5
Share options exercised 0.4 0.4 0.4
Acquisition of own shares 0.0 0.0
Acquisition of non-controlling interest 0.0 0.0
Other changes* 0.6 0.6 0.2 0.8
Equity 31.12.2019 30.2 1.8 18.7 29.3 80.1 1.7 81.8
Translation difference 0.4 0.4 0.4
Prot/loss for the period 21.9 21.3 1.3 23.2
Dividends -15.3 -15.3 -1.0 -16.3
Share options exercised 1.5 1.5 1.5
Acquisition of own shares 0.0 0.0
Acquisition of non-controlling interest 0.0 0.0
Other changes** 2.7 1.2 3.8 1.0 5.4
Equity 31.12.2020 30.2 1.8 22.8 37.5 92.4 3.0 95.4
The Group´s equity capital is specied in Note 2.19. Equity Capital.
*Other changes from 2019 include the accrual of expenses arising from granted retention share programs, which is presented as part of the change in the retained earnings column (0.6 M€).
**Other changes from 2020 include the accrual of expenses arising from granted retention share programs, which is presented as part of the change in the retained earnings column (1.2 M€). In addition, the share exchange
between Evli Awards Management Oy and Alexander Incentives Oy and its effect is presented as other changes both in reserve for invested unrestricted equity (2.7 M€) fund and in non-controlling interests (1.0 M€).
GOVERNANCE
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Basic information on the company
Evli Bank Plc is a bank specializing in investment
whose clients are institutions, companies and
present or future high net worth individuals. Evli
Bank Plc and its subsidiaries form the Evli Group
(“Evli”). Evli serves its clients in international
groups in two business areas: Wealth Manage-
ment and Investor Clients and Advisory and
Corporate Clients. Evli’s product and service
selection include mutual funds, asset manage-
ment, capital market services, alternative invest-
ment products, investment research, incentive
plan design and administration, and M&A ser-
vices. The company also offers banking services
that support clients’ investment activities.
Evli’s head office is in Finland. In addition,
the company operates in Sweden through a
branch ofce of the Fund Management Com-
pany and its subsidiary Evli Corporate Finance
Ab and in the United Arab Emirates through its
subsidiary Terra Nova Ltd.
The Group’s parent company is Evli Bank Plc.
The parent company is domiciled in Helsinki
and its registered address is Aleksanterinkatu
19 A, 00100 Helsinki.
A copy of the consolidated financial state-
ments can be obtained from www.evli.com
or from the parent company’s head ofce at
Aleksanterinkatu 19 A, 00100 Helsinki.
Basis for preparation of the nancial
statements
The consolidated financial statements have
been prepared in compliance with IFRSs
(International Financial Reporting Standards),
approved for application in the EU, and IASs
(International Accounting Standards) valid at
the end of 2020, together with their respective
SIC (Standing Interpretations Committee) and
IFRIC (International Financial Reporting Inter-
pretations Committee) interpretations. In addi-
tion, Finland’s accounting and limited liability
company legislation and official regulations
have also been considered in preparing the
consolidated nancial statements. The gu-
res in the nancial statements are presented
in millions of euros, unless indicated otherwise.
The consolidated financial statements have
been prepared based on historical cost, with
the exception of nancial assets and liabilities
recognized at fair value through prot or loss,
and derivative nancial instruments.
During a financial year, the figures are pre-
sented in interim reports so that the income
statement items are compared with the cor-
responding period of the previous year while
the comparison of balance sheet items relates
to the end of the previous year, unless speci-
ed otherwise.
The accounting policies apply to 2020. The
accounting policies for comparative gures are
presented in the 2019 Financial Statements.
Read more at www.evli.com/investors.
Translation of items denominated in foreign
currency
The gures showing the prot/loss and nancial
position of the Group’s units are measured in
the currency used in each unit’s main functional
environment (“functional currency”). The con-
solidated nancial statements are presented in
euros, which is the functional and presentation
currency of the Group’s parent company.
Foreign currency transactions are translated
into the functional currency using the exchange
rates prevailing on the date of the transaction.
Monetary balance sheet items are translated
into the functional currency at the rate prevai-
ling on the balance sheet date. Exchange rate
differences arising in connection with the va-
luation are included in net income from
foreign exchange.
The income statements of foreign Group enti-
ties are translated into euros at the weighted
average rates for the period, and the balance
sheets at the rates prevailing on the balance
sheet date. In the consolidated income state-
ment and balance sheet, the translation diffe-
rences resulting from the use of different rates
for the translation of Group results for the
period is recognized in income and expenses
recognized directly in equity and presented
under equity. The translation differences ari-
sign from the elimination of the acquisition
cost of foreign subsidiaries and from post-ac-
quisition cumulative changes in equity items
are recognized in income and expenses rec-
ognized directly in equity and presented under
equity. When a subsidiary is disposed of wholly
or partly, the cumulative translation differences
are recognized in prot or loss as part of gains
or losses from disposal.
Accounting policies
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Financial assets and liabilities
The Group’s nancial assets and liabilities are
classied in accordance with the IFRS 9 Finan-
cial Instruments standard. Under the IFRS 9
standard the classication of nancial assets
is based on the business model and the type
of contractually accrued cash ows. The busi-
ness model reects how a group of nancial
assets are managed in a business unit in order
to meet a certain nancial objective. The fol-
lowing are the classication groups:
• Financial assets measured at amortized
cost
• Financial assets measured at fair value
through comprehensive income
• Financial assets measured at fair value
through prot or loss.
A nancial asset is classied at amortized cost
if the following criteria are met:
• the aim of the business model is to collect
contractual cash ows
• the contractual cash ows only contain
payments of principal and interest (i.e. a
debt instrument).
A financial asset is classified at fair value
through comprehensive income if the follo-
wing criteria are met:
• the aim of the business model is both to
collect contractual cash ows and to sell
them
• the contractual cash ows only contain
payments of principal and interest (i.e. a
debt instrument).
All other nancial assets are classied at fair
value through profit or loss, for example
equity instruments. With respect to shares
and participations not in the trading book,
the company can make a decision on an indivi-
dual instrument basis if the instrument is clas-
sied as a nancial asset that is recognized at
fair value through comprehensive income. An
example of this is unquoted shares. However,
bond investments that should otherwise be
classied in the group “at fair value through
comprehensive income” can be classied at
fair value through prot or loss using the fair
value option if this classication can be used
to remove an accounting imbalance.
Evli applies the fair value option in classica-
tion, and measures all financial instruments,
including shares and participations, at fair value
through prot or loss as a general principle.
Financial assets are reclassied only if a busi-
ness unit’s operating model changes substan-
tially. Previously recorded prots and losses are
not changed retrospectively.
In the measurement of own debt instruments;
changes in measurements associated with a
change in credit risk must be reported under
equity under IFRS 9. Evli does not measure its
own debt at fair value.
Financial liabilities are measured at amor-
tized acquisition cost, or at fair value through
prot or loss.
The classication is done when a nancial instru-
ment is recognized initially. An impairment based
on expected credit losses is recognized in con-
junction with the recognition of nancial assets
that are classied at amortized acquisition cost.
A financial asset is derecognized when the
contractual rights to the cash ows from the
nancial asset expire or the Group has trans-
ferred substantially all the risks and rewards of
ownership of the nancial asset to an external
party. Financial assets and liabilities are recog-
nized according to the trade date. A nancial
liability is derecognized when the obligation
specied in the contract is discharged.
A nancial asset and a nancial liability shall
be offset only when the Group has a legally
enforceable right to set off the recognized
amounts and intends either to settle on a net
basis, or to realize the asset and settle the lia-
bility simultaneously. There are no substantial
offset items in the consolidated balance sheet.
The Group’s measurement process for nancial
instruments is approved by Evli Bank’s Board
of Directors. The measurements are based
on IFRS 9 and IFRS 13, and on the Financial
Supervisory Authority’s regulations 1/2013:
Bookkeeping in the nancial sector. The bank’s
nancial administration together with risk ma-
nagement administers the Group’s measure-
ment process which includes the inspection
and validation of valuation prices, checking the
parameters used in measurement, and classi-
cation of nancial instruments in accordance
with the standard. Every quarter, the bank’s
Audit Committee audits and submits for
approval by the Board of Directors the measu-
rement of equities and units for which no mar-
ket value is available (instruments in measure-
ment level 3 and associate companies).
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Financial assets
Equity investment and derivatives
Financial assets recognized at fair value
through prot or loss
The Group’s equity investments and deriva-
tives are all classified at fair value through
prot or loss as a general principle. This group
includes equities and derivatives in the trad-
ing book, and longer-term mutual fund and
equity investments by Group Operations.
Unrealized and realized gains and losses ari-
sing from changes in the fair value are recog-
nized in net income or loss from securities tra-
ding in profit or loss for the period in which
they were incurred.
Financial assets recognized at fair value
through comprehensive income
There were no equity investments recognized
through comprehensive income in the consoli-
dated balance sheet on the balance sheet date.
The value of nancial assets at fair value is deter-
mined on the basis of prices quoted on active
markets, i.e. bid quotations on the balance
sheet date and closing prices. In cases where
price quotations are not available from active
markets, the fair value is determined using com-
mon theoretical measurement models.
Common derivatives pricing models are used
in the pricing of unquoted derivatives, or the
price is obtained from the counterparty in the
case of an OTC instrument.
The fair value of unquoted shares is esti-
mated primarily using the instrument’s net
asset value or using a cash ow analysis based
on future outlook. If the company’s share has
been traded, this price information is used in
the assessment. If the acquisition price of an
unquoted investment falls short of the theo-
retical valuation, in individual cases, the instru-
ment’s acquisition price may be used as the
measurement principle, subject to considera-
tion. The acquisition price may be used if other
sufcient or sufciently accurate information
does not exist for making the measurement.
In measurement of private equity funds and
real estate funds the fund’s management com-
pany’s most recently published valuation price,
which is usually published four times per year,
is used.
Debt instruments
Financial assets recognized at fair value
through prot or loss
The Group’s investments in bonds and money
market instruments are all classified at fair
value through prot or loss as a general prin-
ciple. The Treasury function’s investments in
bonds and other interest-bearing papers,
including items in the liquidity reserve and the
corporate bond investments of the trading
book, are included in this group. Unrealized
and realized gains and losses on bonds ari-
sing from changes in the fair value are recog-
nized in net income or loss from securities tra-
ding for the period in which they were incurred.
Changes in the value of money market instru-
ments are recognized as xed income returns
or expenses
Financial assets recognized at fair value
through comprehensive income
The Group has not classied bond investments
as financial assets recognized at fair value
through comprehensive income.
Financial assets
Measured at amortized
cost; expected credit loss
calculation applied
Receivables from credit institutions and central banks
Receivables from the public;
lending
-Promissory notes from individuals and corporate entities
-Accounts with credit facility, individuals and companies
Financial assets measured at fair
value through prot or loss
Financial assets held
for trading
-Shares and participations, quoted
-Derivatives
-Bonds
Other nancial assets
measured at fair value
through prot or loss
-Shares and participations, quoted and unquoted
-Bonds and money market instruments
-Mutual funds
-Private equity and real estate funds
Financial assets measured at fair
value through comprehensive
income
The Group has not classied assets in this group
Distribution of nancial assets IFRS 9:
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FINANCIAL REVIEW
The value of interest-bearing papers mea-
sured at fair value is determined on the basis
of prices quoted on active markets, i.e. bid
quotations on the balance sheet date and
closing prices. The fair value of money market
instruments is calculated by discounting cash
ows with the relevant interest curve, and with
the yield spread that was valid on the day of
acquiring the instrument. For unquoted bonds,
a price quotation issued by an individual bank
or operator is used, or the price of the inter-
est-bearing paper is calculated by Evli Bank in
such a way that the instrument’s return require-
ment corresponds to the return requirement
of similar instruments with the same risk level.
More detailed information on measurement of
nancial assets measured at fair value through
comprehensive income is available in note 7.3.
Financial assets measured at amortized cost
The Group’s lending, including promissory
notes and accounts with credit facility, recei-
vables from credit institutions and other nan-
cial assets are classied under nancial assets
measured at amortized cost.
Financial assets measured at amortized cost
are initially recognized at fair value inclusive
of expenses immediately caused by the acqui-
sition. After initial recognition, the items are
measured at amortized cost using the effec-
tive interest rate method. This refers to the
interest rate at which the future payments that
are expected to become payable or receiva-
ble during the nancial instrument’s assumed
exercise period are discounted to the level of
the nancial instrument’s net book value. The
book value is adjusted by a credit loss provi-
sion using the expected credit loss measure-
ment model (see next section Impairment of
nancial assets).
Impairment of nancial assets
Calculation of expected credit loss is used in
impairment of financial assets, where credit
losses are recognized already in conjunction
with granting of loans and on reporting dates.
In the impairment model, the change in the
quality of the credit is evaluated after original
recognition according to a three-phase model.
The expected credit loss calculation is applied
to nancial assets that are measured at amor-
tized cost, such as granted loans. Impairments
also concern off-balance sheet commitments,
such as unused credit facilities. Impairment is
not applied to nancial assets measured at fair
value, unless they are measured at fair value
through comprehensive income. A simplied
calculation method has been devised for sale
and rental receivables.
Expected credit losses (ECL) are calculated
using the following formula with weighted
probabilities: Liability * PD (probability of
default) * LGD (loss % of liability when reali-
zation of collateral is included). The ECL is an
indicator of the bank’s estimate of how much
less cash ow it will receive on the loan than it
should under the contract. The probability of
loss is estimated using various statistical met-
hods such as analyzing the bank’s loan portfo-
lio and its loss history, and a wider group with
a credit risk that is assumed to be similar. In the
calculations, an estimate of the future market
environment and its trends must also be used.
In IFRS 9, credit losses are measured using a
three-phase model. In the rst phase, the likeli-
hood that the debtor will experience payment
issues within the following 12 months is esti-
mated. Phase 1 includes items where credit risk
is estimated not to have materially increased
after initial recognition or the credit risk of the
item is estimated to be low. If the debtor’s
credit risk has materially increased after initial
recognition, expected credit loss is estimated
for the entire duration of the contract (phase
2). Assets in phase 3 are assets with impaired
value regarding which matters have already
come to light that will have a negative impact
on future cash ows, including the insolvency
of the counterparty.
In a situation in which already impaired loans
and receivables are purchased, the model in
which the expected credit loss is estimated for
the entire exercise period is directly applied.
The loss provision is presented in the income
statement on its own row. The fixed income
returns on nancial assets are presented for
gross principal for nancial assets in phases
1 and 2, and for net principal, i.e. after provi-
sions, for items in phase 3.
Factors that inuence the estimation of coun-
terparty credit risk include overdue payments
and contract violations, negative changes in
the counterparty’s nancial situation and credit
rating and material changes in macroeconomic
factors that have a direct inuence on the bor-
rower’s solvency.
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A loan is recognized as non-performing when
more than 90 days have passed without the
borrower paying interest or making repayment
or if it is estimated that the borrower is unlikely
to perform on its future payment obligations.
The impairment is recognized as a credit loss
when the debtor has been found insolvent in
bankruptcy proceedings, it has closed down
operations or the receivable has been forgiven
in a voluntary or statutory loan arrangement.
Additional information on impairment and the
calculation model is provided in note 5. IFRS 9:
Expected credit losses.
Financial liabilities
Financial liabilities measured at amortized cost
Financial liabilities are initially recognized at
fair value based on the consideration received
inclusive of expenses immediately caused by
the acquisition. After initial recognition, nan-
cial liabilities such as bonds issued by the com-
pany, deposits by the public and other nan-
cial liabilities are measured using the effective
interest rate method at amortized cost.
Financial liabilities recognized at fair value
through prot or loss
Liabilities recognized at fair value through prot
or loss include shorted equities and derivative lia-
bilities held for trading, such as set stock options.
The fair value of liabilities measured at fair
value through prot or loss is determined prin-
cipally on the basis of prices quoted on active
markets, i.e. asking prices quoted on the ba-
lance sheet date and closing prices on the ba-
lance sheet date. In cases where price quota-
tions are not available from active markets, the
fair value is determined using common theo-
retical measurement models.
In securities lending occurring in conjunction
with shorting shares, the securities are retained
in the original owner’s balance sheet.
The liability corresponding to assets acquired
with nancial leasing agreements is included
under other liabilities.
Hedge accounting
The Group does not apply hedge accounting
in accordance with IFRS 9 in the nancial state-
ments.
IFRS 3 Business combination
Business combinations are carried out using
the acquisition cost method. Acquired, identi-
able assets and liabilities, with limited excep-
tions, are measured at fair value at the time
of acquisition. The Group recognizes the
non-controlling interest in the acquiree on an
acquisition-by-acquisition basis either at fair
value or, alternatively, based on the non-con-
trolling interest’s proportionate share of the
acquiree’s identifiable net assets. Acquisi-
tion-related costs are expensed as incurred.
To the extent that the acquisition price exceeds
the identiable assets of the acquiree, the sur-
plus is recognized as goodwill. If the acquisi-
tion price is less than the value of the identi-
able assets, the difference is recognized in
profit or loss. In the event that part of the
purchase price payment is deferred, future
amounts are discounted to their present value
at the time of the transaction. The discount
rate used is based on management’s estimate
of the Group’s cost of debt.
IFRS 15 Revenue from contracts with cus-
tomers
The IFRS 15 guidance applies to all revenues
collected from clients that are not processed in
accordance with other IFRS standards such as
IFRS 9. Interest and dividend income are also
examples of revenue items that do not come
under IFRS 15. According to IFRS 15, revenue
is recognized when a company transfers con-
trol of goods or services to a customer either
over time or at a point in time.
Key revenue streams that fall under the stan-
dard and are based on client contracts have
been analyzed using the ve-step model. The
client contract on which the stream is based
and any performance criteria on which fees
are based have been identied for each reve-
nue stream. The fee charged has then been
allocated to each performance criterion and
the revenue recognition principles have been
built around meeting the criteria. Breakdown
of revenue in accordance to IFRS standard
between overtime and at a point in time re-
cognized revenue is shown as part of the seg-
ment reporting.
IFRS 16 Leases
Leases
Leases of property, plant and equipment in which
substantially all the risks and rewards of owner-
ship are transferred to the Group are classied as
nance leases. An asset leased under a nance
lease is recognized at the inception of the lease
at the lower of the fair value of the leased asset
and the present value of the minimum lease pay-
ments. An asset leased under a nance lease is
depreciated over the shorter of the asset’s use-
ful life and the lease term. Lease payments are
Financial
liabilities
Financial liabilities measured at
fair value through prot or loss
- Derivative contracts
- Shorted shares
Other nancial liabilities, at
amortized cost
- Deposits by nancial institutions
- Deposits by the public
- Issued bonds
- Other nancial liabilities
Distribution of nancial liabilities IFRS 9:
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allocated between the interest expense and the
reduction of the outstanding liability during the
lease term to produce a constant periodic rate
of interest on the remaining balance of the lia-
bility for each nancial period. Finance lease lia-
bilities are included in other liabilities. In accord-
ance with IFRS 16, related leases are treated as
described above way.
Leases in which substantially all the risks and
rewards of ownership are retained by the lessor
are classied as other leases. Payments made
on other leases are recognized in prot or loss
on a straight-line basis over the lease term.
IFRS 16 Leases has been adopted as of Janu-
ary 1, 2019. In conjunction with the adoption
of IFRS 16, the company recognized lease lia-
bilities in relation to leases which had previ-
ously been classied as operating leases under
the principles of IAS 17 Leases. The liabilities
were measured at the present value of the
remaining lease payments. When conside-
ring the present value, an estimate of index-
based increases in future periods is taken into
account. Future cash ows of the leases have
been discounted at the reporting date using
a discount rate selected by the company. The
company has not calculated a separate interest
component for the assets required for nan-
cing the lease liabilities due to the company’s
low funding costs and excess liquidity. The lia-
bility entered in the balance sheet decreases
in a linear manner over time.
Evli has applied, for example, the following
practical expedients permitted by the stan-
dard when implementing IFRS 16:
• use of a single discount rate for a portfolio of
leases with reasonably similar characteristics,
• exclusion of leases with a lease term of
less than 12 months,
• use of hindsight in determining the lease
term where the contract contains options
to extend the lease.
Evli has analyzed its contract portfolio tak-
ing into account the IFRS 16 standard. Based
on the analysis, the IFRS 16 standard mainly
applies to leases of premises that the company
has previously treated as operating leases
under IAS 17. Typically, lease contract terms
range between two and five years and may
contain an option to extend the lease term.
Evli has negotiated individual contracts with
potentially differing terms and conditions for
each location.
The impact of the IFRS 16 standard on the
Group’s other assets and other liabilities at
the end of the nancial year was EUR 9.6 mil-
lion. Potential options to extend current leases
have not been considered due to uncertainty
related to the use of those options.
Matters requiring management
judgement
The drawing up of financial statements in
accordance with IFRS standards requires that
certain accounting assessments are made. In
addition, management must use its judge-
ment. Judgement affects the choice of accoun-
ting policies and their application, the amount
of assets, liabilities, revenues and expenses to
be reported and the notes that must be pre-
sented. The management exercises its judge-
ment on the basis of estimates and assumptions
that are based on earlier experience and the
MEASUREMENT OF LEASE LIABILITIES 2020
Commitments related to leases on 31.12.2019 4.9
Less (-) short-term leases not recognized as a liability 0.0
Less (-) leases of low-value assets 0.0
Add/less (-): contracts reassessed as lease contracts 0.0
Add/less (-): adjustments as a result of a different treatment of extension
and termination options 0.0
Add/less (-): adjustments relating to changes in the index
or rate affecting variable payments 0.0
Lease liability recognized on 1.1.2020 4.9
Additions 6.8
Deductions 0.0
Depreciation -2.1
Lease liability according to balance sheet on 31.12.2020 9.6
Of which are:
Current lease liabilities 2.2
Non-current lease liabilities 7.3
best view available to it on the balance sheet
date especially concerning the future perfor-
mance of the investment services market. Esti-
mates and decisions based on judgement are
constantly monitored and they are based on
actual performance and certain other factors
such as expected future events that are reaso-
nably anticipated to occur considering prevail-
ing circumstances. Actual performance may
deviate from estimates.
At Evli, the most signicant estimates concern
the impairment testing of goodwill and the
measurement principles of theoretically mea-
sured nancial instruments. Further informa-
tion on them is provided in the note in ques-
tion, under the title Management judgement.
Provisions
A provision is recognized when the Group has
a legal or constructive obligation as a result of
a past event, and it is probable that an outow
of economic benets will be required to settle
the obligation and the Group can reliably esti-
mate the amount of the obligation.
Adoption of new and amended standards
and interpretations applicable in future
nancial years
New standards are not expected for the next
financial year that would have a significant
impact on Evli Group´s accounting policies.
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Evli operates in a constantly changing market
environment, which subjects the company to
risks caused by changes in the business envi-
ronment or the company’s own operations.
Risk management refers to actions that sys-
tematically seek to assess, identify, analyse
and prevent risks. The objective of risk man-
agement is to:
• ensure the sufciency of own assets in
relation to risk positions
• maintain the nancial result and the varia-
tion in valuations within the set objectives
and limits
• price risks correctly to reach sustainable
protability.
Organisation of the control operations
Evli’s Board of Directors is primarily respon-
sible for Evli Group’s risk management. The
Board conrms the principles and responsibi-
lities of risk management, the Group’s risk li-
mits and other general guidelines according to
which the risk management and internal control
is organised. The Board has also appointed a
credit and asset liability committee (Credalco),
which briefs it on risk-taking matters. Its mem-
bers during the nancial year 2020 were Kristian
Nybergh (Chairman), Juho Mikola, Kim Pessala
and Maunu Lehtimäki; expert members were
Mari Etholén, Bengt Wahlström and Jan-Erik
Eriksson.
Evli Group’s risk management is founded on
the “three lines of defence” model:
1. The rst line of defence consists of the
business units. The managers of the busi-
ness units are responsible for ensuring that
risk management is at a sufcient level in each
respective unit.
2. The second line of defence consists of Risk
Control and Compliance functions. The Risk
Control function oversees daily operations
and compliance with the risk limits granted to
the business units, as well as compliance with
risk-taking policies and guidelines. The Risk
Control function reports on findings to Cre-
dalco, the Executive Group and the compa-
ny’s Board of Directors.
The Compliance function is responsible for
ensuring compliance with the rules in all of Evli
Group’s operations by supporting operating
management and the business units in apply-
ing the provisions of the law, the ofcial regu-
lations and internal guidelines, and in identi-
fying, managing and reporting on any risks of
insufcient compliance with the rules.
3. The third line of defence is Internal Audit.
Internal Audit is a body that is independent of
business operations, supports the Board of
Directors and the senior management, and
is organised administratively under the CEO.
Internal Audit assesses the functioning of Evli
Group’s internal control system, the appropri-
ateness and efficiency of its operations, and
the compliance with guidelines, through audits
that are based on a plan of action for internal
auditing that is conrmed annually by the Audit
Committee of Evli Bank’s Board of Directors.
Additional information about the organisation
of Evli Bank’s control operations in the Corpo-
rate Governance Statement on pages 136-138.
Risk management and the largest risks
Evli operates in a constantly changing market
environment, which subjects the company to
risks caused by changes in the business envi-
ronment or the company’s own operations.
The risk factors described below might have a
negative impact on the business operations or
nancial situation of the company, and hence its
value. Also, other risks, unknown to Evli at this
time, or risks not considered signicant at this
time, might become signicant in the future.
Evli divides risks into three main categories:
1. Financial risks: market, credit and liquidity
risks
2. Operational risks: legal, compliance and
information security risks
3. Strategic risks: deployment of new prod-
ucts and services and outsourcing of ope-
rations.
Financial risks
Financial risk is a risk caused by the operating
environment of the company and any market
changes therein, and the nature of the compa-
ny’s business. Financial risks include market risk
that contains equity, currency and interest rate
risk as well as credit and liquidity risks.
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Evli’s business involves an indirect equity risk
resulting from the business operations of Evli
Fund Management Company and the Wealth
Management and Investor Clients segment.
The stock market affects the allocation, size
and returns of the capital managed in these
business operations.
Currency risk
Evli’s Treasury manages the currency risk of the
balance sheet. The currency risk limit is dened
by currency and total gross amount. The gross
total currency position may not exceed four
million euros without an authorisation from
Credalco. The maximum total currency posi-
tion is six million euros, subject to Credalco’s
permission. The currency position on Decem-
ber 31, 2020 is described in more detail in the
Notes on risk position section 6.4. Market risk.
Interest risk
Interest risk refers to the sensitivity of the cur-
rent value in the balance sheet to changes in
the general interest rate. Interest risk arises as a
result of xed income investments of the nan-
cial activities, trading book, derivatives mar-
ket-making and strategic investments, which
Market risks
Evli is conservative when it comes to direct mar-
ket risk and taking market risk is not considered
as a real source of income for Evli. According to
Evli’s market risk strategy, market risk should not
have a signicant impact on Evli’s prot under
normal market conditions, and market risk
should not under any circumstances endanger
Evli’s continuity or protability.
Equity risk
Equity risk means the sensitivity of Evli’s pro-
tability and the market value of the balance
sheet to changes in the general price level
of the stock market. Evli’s direct equity risks
consist of Corporate Finance operations, the
temporary position of the brokerage business
and strategic investments. In the Corporate
Finance and brokerage business there were
no equity positions on December 31, 2020.
Most of the strategic investments are private
equity funds, in which Evli has either deve-
loped the product and/or acted as the dis-
tributor, or seed capital investments into Evli
Fund Management Company’s mutual funds,
hedges associated with business operations or
Business operations Market value Scenario A Scenario B Total
Assets – Financial activities 585.3 -1.6 0.2 -1.8
Liabilities – Financial activities -539.3 0.4 0.1 0.5
Strategic investments 0.1 0 0
Table 2: Interest risks December 31, 2020, M€
Business operations Market value
Effect of a 20% change in the stock
market to the nancial result
Brokerage 0.3 0.1
Strategic investments 8.8 1.8
Corporate Finance 0 0
Table 1: Equity risks December 31, 2020, M€
difcult-to-sell equities obtained in corporate
transactions. The direct equity risks are pre-
sented in table 1.
Share-based incentive plans administered
under agreement on behalf of clients are
implemented by purchasing shares of the cli-
ent companies in question. Due to contractual
arrangements made with clients, this arrange-
ment does not pose an equity market risk to
Evli. The credit risks and counterparty risks
generated by changes in the market prices are
monitored separately. The monitoring proce-
dure is described in the paragraph Credit risks.
Of the entire investment portfolio and tra-
ding book, 5.1 percent has been valuated
using theoretical valuation methods, since no
market price has been available. Information
about the methods used in the valuation of
the investment instruments is presented in the
accounting policies in the nancial statements.
Instruments measured by theoretical means
were recognised entirely through prot or loss
during the nancial year, because the matu-
rity periods of theoretically measured agree-
ments are short, and the accounting para-
meters used are primarily based on informa-
tion from the markets.
are seed capital investments into Evli Fund
Management Company’s xed-income funds.
The interest risks are presented in table 2.
The basic scenario, (Scenario A) measures
the effect on the current value of the balance
sheet, if the interest rate changes linearly by
one percentage point. Another scenario (Sce-
nario B), which is used for measuring the xed
income investments of the bank’s financial
activities, measures the effect of the change
in the slope of the interest rate curve to the
market value in the balance sheet. In Scenario
B, the short interest rates change by 0.5 per-
centage points, and at the same time, the over
one-year interest rates change in the opposite
direction by 0.25 percentage points. The net
result from Scenario A and B is added up, and
the result indicates the total sensitivity of the
nancial activities to interest rates. The inte-
rest rate risk, taking into account assets and
liabilities, was EUR 1.4 million on December
31, 2020. In the other operations the interest
risks were not signicant.
Credit risks
According to Evli´s credit risk strategy, ta-
king credit risks is not Evli’s primary source
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of income, but a consequence of other busi-
nesses, and under no circumstances can credit
risks jeopardise Evli’s continuity. Credit risks
arise from the bank’s financial activities, tra-
ding book and the counterparty risk of trading.
The credit risk in Evli’s nancial activities con-
sists of client lending, investments of the nan-
cial activities and the counterparty risk of cur-
rency/interest rate hedging. The purpose of
lending is not to be the primary source of
income alone, but lending focuses on the cli-
ents of Evli’s Wealth Management, and loans
must have corresponding collateral. Accept-
able collateral includes cash, liquid shares,
mutual funds, bonds and structured pro-
ducts. Not all of these products are eligible
for deduction in the standard method used
by Evli to assess the credit risk. The concen-
tration risk in lending is limited to five mil-
lion euros per individual client entity. The rest
of Evli´s assets of its banking operations are
invested primarily in securities issued by the
Government and other public-sector bodies
as well as banks and credit institutions opera-
ting in the Nordic countries or with at least a
credit rating A-. Investments in credit institu-
tions focus on credit institutions operating in
the Nordic countries. In addition, the Treasury
unit may invest in capital debt instruments or
funds investing in them, taking into account
the solvency and liquidity ratio. Credalco li-
mits the total amount of direct corporate debt
instruments made by Treasury. At the end of
2020, the limit was EUR 10 million. In addition,
the Treasury may invest in Evli’s xed income
funds, where the maximum investment per
fund is EUR 10 million according to the limits
of the Board of Directors.
The counterparty risk of currency and interest
hedges is managed with daily collateral ma-
nagement. Only cash qualies as collateral of
the counterparties in currency and interest rate
hedging. As a result, the credit risks of nan-
cial operations are at a moderate level. The
limits of nancial operations are set by taking
into account, among other factors, the credit
rating and geographical location of the issuer.
The credit risks of brokerage activities were low
during the nancial year. The counterparty risk
of derivatives operations is managed by means
of daily collateral management for standardised
and non-standardised derivatives contracts. Evli
monitors the size of the counterparties’ deri-
vatives positions and, if necessary, limits the
size of the derivatives positions of an indivi-
dual counterparty. Credalco gives its approvals
to all counterparties with whom non-standard-
ised derivatives agreements are made. Deri-
vative claims on marketplaces on December
31, 2020 were a total of EUR 15.1 million. Evli
has placed cash on the marketplace as a gua-
rantee and the clients have placed their client
portfolios as guarantee for Evli. Clients did not
have signicant collateral decits at the turn of
the year. The risks of share brokerage clearing
were low during the nancial year. The amount
of matured sales receivables was low and was
monitored with a standardised process. Table
3 summarises the credit risks. In addition, the
credit risk position is described in more detail
in the Notes on risk position in sections 6.4.-6.6.
Liquidity risks
As with other financial risks, the risk-taking
regarding liquidity risks is conservative, and
Evli’s liquidity cannot be compromised under
any circumstances. According to the liquidity
risk strategy, there must be an additional buffer
over the regulatory requirements.
Evli’s Board of Directors conrms the limits for
using tied-up capital. Proposals for these limits
are prepared by Credalco. In its funding ope-
rations, Evli must always be prepared to ensure
that its liquidity matches the set limits. The
Treasury function is responsible for managing
the liquidity risk. The liquidity risk is monitored
by, for example, having the risk management
unit of the Group follow the maturity distri-
bution of assets and liabilities and reporting
Market value Collateral Type of collateral
Financial activities
Lending 110.7 549.5 Clients’ portfolios
Investment activities 94.7 0
Finnish municipal paper 8.0 0
Banks (minimum credit rating A-) 37.2 0
Banks (no credit rating) 0 0
Corporate Bonds (direct) 1.4 0
Corporate Bonds (mutual funds) 48.1 0
OTC derivatives between banks -25.5 0 Cash
OTC derivatives between Evli and funds 10.6 52.6 Cash
Trading book 0 0
Table 3: Credit risks December 31, 2020, M€
this to the Executive Group, Credalco and the
Board of the company. The assets and liabili-
ties of the Group are presented in the Other
notes section 7.1. Maturities of nancial assets
and liabilities.
Most of the expenditure in 2020 consisted of
lending and the Treasury function’s investment
portfolio. Other factors tying up capital were
the collaterals for the clearing and derivatives
operations.
The Liquidity Coverage Ratio (LCR) entered
force on October 1, 2015. The requirement
describes the extent of the bank’s liquid assets
with relation to net outows that take place in
a stressed situation in a 30-day period. The net
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outows include outows of savings and other
funding, and can be offset by inows, such as
receivables falling due in 30 days.
As the LCR entered force, the ratio had to be
at least 100 percent. Evli’s Board of Directors
has set, that the ratio must be at least 110 per-
cent. The LCR calculation and its results are
described in more detail in the Other notes
in section 7.7 Liquidity Coverage Requirement
(LCR).
Furthermore, Evli’s internal liquidity adequacy
assessment process (ILAAP) has been deve-
loped to meet the requirements of authorities.
Leverage ratio
Leverage ratio describes the ratio of Tier 1
capital to the total exposures. The total expo-
sure includes the exposure values of all assets
and the amount of off-balance sheet items
which have not been subject to decreases
when determining the amount of own funds.
Off-balance sheet items are included in the cal-
culation according to the credit counter-value
ratio and derivatives according to the expo-
sure value. The leverage ratio of Evli Group
was 7.2 percent on December 31, 2020.
Operational risks
Operational risks mean a direct or indirect dan-
ger or nancial loss that is caused by insuf-
cient or failed internal processes, systems,
personnel or external factors. Operational
risks also include legal, compliance and data
security risks. Therefore, operational risks are
associated with, for example, the management
system, operative processes, information sys-
tems, individuals and various external factors
or threats. Each unit is responsible for ma-
naging the operational risks of their respective
areas. According to the risk management stra-
tegy, all relevant operational risks must be
identied and mitigated to such a level that
Evli’s continuity or protability is not compro-
mised.
Evli continuously pays special attention to the
identication, monitoring and control of ope-
rational risks. The business units carry out reg-
ular self-assessments of the operational risks of
products, services, individuals, operating pro-
cesses and systems. Evli has prepared a se-
parate group-wide standard operating proce-
dure for identifying, assessing, controlling and
reporting operational risks. Operational risks
increase the requirement for minimum capital
in the capital adequacy calculation. In its ca-
pital adequacy calculation, Evli uses the Basic
Indicator Approach for operational risks, where
the capital requirement of operational risks is
based on the average gross income from the
preceding three years multiplied by the factor
set by the Basel committee (0.15). The calcula-
tion of the solvency requirement is described
in the Notes on risk position 6.8. Solvency
Supplement.
Legal and compliance risks
Rapid changes in legislation and legal praxis
pose challenges to the implementation of
guidelines and regulations. Changes often
require a lot of time and effort. The primary
responsibility for compliance with specic laws
and governmental regulations applicable to
the different Evli companies always rests with
the line management in charge of the function
in question. Moreover, Evli’s Board of Direc-
tors has appointed a Compliance Ofcer, and
the Executive Group has designated a Com-
pliance Steering Committee whose members
represent the various business functions.
Information security risks
Evli’s operations are based to large extent on
the utilisation of information technology and
telecommunications. One of the key objec-
tives of all Evli functions is the efcient, error-
free and secure processing of information in
a variety of formats. Evli handles and stores
substantial amounts of information that is de-
signated as condential under applicable law,
guidelines or contracts or otherwise requires
special security arrangements. The conden-
tiality, accuracy and usability of such informa-
tion must be protected at all times. To manage
information risk, it is necessary to ensure that
information systems function properly and reli-
ably and to pay particular attention to the cor-
rectness of information updated in databases
and to the management of access rights.
Information asset owners are primarily respon-
sible for protection of the information assets
at Evli. Information protection includes the
correctness, availability and condentiality of
data. The system administrator is the person
who takes care of the technical maintenance
tasks required for the system. Evli’s Information
Management is responsible for organising the
maintenance of Evli’s systems. Technical main-
tenance is planned and executed in collabora-
tion with the information system owner and its
administrator. For this reason, a specic “Infor-
mation Security Policy” that addresses infor-
mation security and related procedures has
been prepared for the management of ope-
rational risks related to information systems
and information security. No nancial losses
were sustained in 2020 as a result of misuse
of information systems or disturbances affec-
ting them. In addition to arranging normal
asset protection, Evli has comprehensive insur-
ance coverage for liability and criminal losses.
Strategic risks
New products and services
The safe introduction of new products and ser-
vices requires that, prior to making the final
decision on introduction, assurance has been
obtained that all units participating in the
delivery of the product know their respective
duties and that they have made the function in
question aware of any operational and other
risks involved in launching it on the market.
The indirect effects of the realisation of risks
on the whole Group need to be assessed with
particular care. Evli uses a standardised proce-
dure concerning the approval and introduction
of new products and services.
Outsourcing operations
The delegation of business operations to
agents or other outsourcing of operations does
not relieve Evli of its responsibilities or obli-
gations. Evli has adopted guidelines regard-
ing the principles that must be complied with
when Evli’s business operations are delegated
outside the Group. These guidelines ensure
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that the management and monitoring of oper-
ational risks relating to the outsourced func-
tions is arranged in the manner required by the
Financial Supervisory Authority.
Continuity management
Evli’s operations may be threatened by external
or internal crises of a physical or other nature.
In crisis situations, an organisation must:
• be prepared
• have crisis management capability
• have prepared by means of drills.
To ensure operational continuity, each function
has a continuity plan. The purpose of conti-
nuity planning is to ensure that, in the event
of certain threats materialising, it is possib-
le to ensure the safety of Evli’s clients and
employees, to protect tangible and intangib-
le property, to comply with the law and other
regulations, to maintain the targeted level of
customer service and internal operations and
to preserve the trust of stakeholders.
Each continuity plan will include system reco-
very plans, including guidelines on how to get
information systems into operating condition
in situations of severe failure, how to continue
operations and how to return operations to
normal.
Evli has compiled a Recovery Plan that com-
plies with ofcial requirements. The law states
that each bank must have a Recovery Plan
that describes the measures that will ensure
the continuation of operations if the bank’s
nancial position weakens. The coordination
of continuity planning is the responsibility of
the Group’s Risk Control unit.
Risk monitoring and reporting
The Group’s Risk Control unit is responsible
for corporate-wide risk reporting, which con-
sists of both numerical and written reports. The
reports include at least the following:
1. Daily report to the Executive Group on the
utilisation of corporate limits
2. Monthly numerical and verbal risk mana-
gement report and summary of client
exposure and limit utilisation to Credalco
3. Quarterly numeric and verbal summary of
risks to Evli’s Board of Directors
4. Annual operational risk assessment report
to the Executive Group and the Board of
Directors.
In addition, the Compliance function and the
internal audit report regularly on risk manage-
ment matters to the top management.
Managing capital adequacy
An essential element of the regulations is com-
pliance with the solvency requirement set by
the regulations and the Internal Capital Ade-
quacy Assessment Process (ICAAP). The ca-
pital adequacy regulation is based on the prin-
ciple that the quantity, quality and allocation
of the bank’s own assets must be continuously
sufficient to cover the material risks apply-
ing to the supervised party. It is not possible,
however, to use capital to replace deficien-
cies in the qualitative aspects of risk-bearing
capacity. Broadly speaking, risk-bearing capa-
city includes not only capital and protability,
but also reliable management, well-organised
internal control and risk management.
Evli’s Board of Directors has set a target of
maintaining at least a 13.0 percent BIS capital
adequacy. This target is monitored by means
of the Risk Control unit´s monthly reports to
the Board of Directors, the Executive Group
and Credalco. Evli’s internal capital adequacy
management calculations are updated as
deemed necessary by the management. How-
ever, this updating takes place at least once a
year as part of strategic planning during the
budgetary process.
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Accounting policies
Interest income and expenses
Interest income and expenses are calculated using the effective interest rate method. In recognizing an
impairment loss on a contract classied as a nancial asset, the recovery of interest is continued at the lo-
wered accounting balance using the original effective interest rate of the contract. If the receipt of interest
is unlikely, it is recognized as an impairment loss. Interest income obtained from nancial assets is recog-
nized as interest income.
Borrowing costs
Borrowing costs are recognized as an expense in the period in which they are incurred. The directly attributa-
ble transaction costs of a certain borrowing are included in the original amortized cost of the borrowing and
are amortized as interest expense by using the effective interest method or, if necessary, by following a formula
whose result can be deemed as being sufciently near the sum calculated by using the effective interest method.
Notes to income statement
1.1. INTEREST INCOME 2020 2019
At fair value through prot or loss
Debt securities 0.4 0.6
Derivative contracts 0.0 0.0
Interest income from other loans and claims
Claims on credit institutions 0.1 0.2
Claims on the public and public sector entities 1.5 1.6
Other interest income 0.9 1.2
Interest income, total 2.8 3.6
1.2. INTEREST EXPENSES 2020 2019
At fair value through prot or loss
Derivative contracts and trading liabilities 0.0 0.0
Interest expenses from other borrowing
Liabilities to the public, public sector entities and credit institutions -2.1 -2.0
Debt securities issued to the public -0.4 -0.5
Other interest expenses -0.2 -0.7
Interest expenses, total -2.6 -3.2
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1.3. COMMISSION INCOME 2020 2019
Credit related fees and commissions 0.0 0.1
Income from payment transactions 0.0 0.0
Insurance brokerage 0.1 0.1
Advisory services 10.1 11.6
Securities brokerage 9.2 9.6
Securities issue 0.0 0.0
Mutual funds 47.6 44.9
Asset management 10.8 7.3
Custody services 0.3 0.4
Other operations 1.7 0.2
Commission income, total 79.9 74.1
Accounting policies
Revenue recognition
From the Wealth Management and Investor Clients
-segment, Evli receives management fee income from
mutual funds and pays clients fee refunds related to
management fees. Fund fees consisting of manage-
ment fees and client refunds are recognized on a
monthly basis and are mainly invoiced retrospectively
in one, three, six- or twelve-month periods. These fees
are typically calculated based on the market value or
initial investment in the fund as well as on agreed
upon fee percentage over time. Any non-recurring
fees related to the mutual funds, such as acquisition,
subscription or redemption fees, are allocated to the
month in which the right to the fee arises.
With successful investment activities, fee income may
include performance-related fees. These may con-
sists of performance fees related to mutual and spe-
cial investment funds, carry fees received by the gene-
ral partner of an alternative investment fund as well as
performance fees related to asset management port-
folios. The performance-based fees of mutual funds
are taken into account daily in the values of the funds
and invoiced retrospectively on a monthly basis. The
performance-based fees of special investment funds
are invoiced on a quarterly basis. Performance fees
related to the asset management portfolios are recog-
nized as income only when the final amount of the
fee can be reliably estimated. Evli Group annually
reviews the performance-based fees of alternative
investment funds due to the general partner of the
fund, the so-called carry fees, and models the pro-
babilities related to their realization. The company will
only consider the performance fee for the alternative
funds to the extent that it is probable that the amount
of accrued recognized income will not need to be sig-
nicantly reversed at a later date.
Securities brokerage transactions are recorded
according to the trading date.
The calculatory commission from issued equity linked
notes is recognized immediately in the income state-
ment. The entire commission is available for use on
the date of issue of the notes, and the commission is
used to cover the arrangement and issuance of the
notes. The notes are recognized in the balance sheet
at the amortized cost, and the interest component of
the loan, which is the same as the value of the option,
is recognized as a separate debt item in the group
“Derivative contracts and trading liabilities”. The inte-
rest expense for the notes is calculated by using the
effective interest method.
Evli’s Advisory and Corporate Clients -segment
receives monthly retainer fees and success fees
related to corporate consulting, ie Corporate Finance.
Monthly retainer fees are recognized as income over
time whereas recognition of success fees, which are
treated as variable consideration, is linked to the com-
pletion of projects. Project success fee income is recog-
nized as income in the period when the outcome of
the project can be estimated reliably and when the
performance obligation has been met. Costs incurred
for any project are expensed immediately.
Evli also receives fees related to the design and
management of incentive programs. Fees related
to the design of incentive programs are invoiced on
a monthly basis and recognized as income for the
period in which the invoicing has taken place. For the
management of incentive programs, fees are billed
on a quarterly, semi-annual or annual basis. Remune-
ration is accrued evenly over the period to which the
work relates. Other consultancy fees, including analy-
tical services, are recognized in the period in which the
work is performed.
Management judgment
The commission income of asset management
and mutual funds is subject to adjustment items
that can in some circumstances include ambigu-
ity with respect to the date of validity and scope,
among other things. This applies to situations in
which price reductions have been agreed upon
with clients by using “fee reimbursement con-
tracts”. For this reason, the management has used
its judgment and has strived to make the most
conservative assessment of the fee reimburse-
ment debt arising from these, or any contracts of
which there is knowledge but have not yet been
entered in the system. The debt is recovered
monthly and is included as an item that reduces
fund and asset management fees.
Commission Income
0
10
20
30
40
50
M€
Advisory services
Securities brokerage
Mutual funds
Asset management
Custody services
Other operations*
11,1
9,2
10,8
0,3 1,9
47,6
*Other includes lending, payment transaction, insurance brokerage, securities issuance and other activities.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 75 | 149
FINANCIAL REVIEW
1.8. PERSONNEL EXPENSES
Accounting policies
The total salaries paid by the Evli Group to its person-
nel consist of xed salaries and remuneration, variable
remuneration under the annually adopted reward sys-
tem, and long-term incentive systems.
Fixed salaries play an important role in the company.
By aiming to offer its employees a competitive pay
level, the company ensures that it continues to be
staffed by a skilled workforce. A reward system based
on variable salaries applies to all the Group’s employ-
ees. The objective of the reward system is to support
the implementation of the company’s strategy as well
as promote its competitiveness and long-term nan-
cial success.
In addition to the above remuneration methods, the
company may create separate long-term incentive sys-
tems. The company has three share-based incentive
program that are currently in effect: Share Program
2017, 2018 and 2019. Under 2017 and 2018 programs,
shares are issued gratuitously during the next three
years in equal installments to the members of the
program, provided that the person is still employed
by the company. After granting, there is still a three-
year evaluation period during which the company has
the right to recall the shares if there is a valid reason,
such as resignation. Correspondingly, in the 2019 pro-
gram shares are issued gratuitously four years after
the start of the program, provided that the person is
still employed by the company. The company’s Board
of Directors decides upon the distribution of shares.
Additional information on the share-based incentive
programs in the Remuneration policy on page 140-142
and Remuneration Report on page 143-146.
The Evli Group provides a reward fund for its employ-
ees. All employees of the Evli Group companies that
are based in Finland are members of the fund. Using
the fund is voluntary. Decisions to enter rewards in the
fund are made one year at a time. Social security costs
are not withheld from assets invested in the fund. The
fund invests its member share capital in accordance
with the Act on Personnel Funds. Capital is invested
in accordance with a strategy prepared jointly by the
fund’s Board of Directors and Wealth Management.
In the payment of benets payable upon termination
of employment, Evli complies with normal agreements
related to termination of employment pursuant to valid
legislation. During the nancial year, the company has
not paid sign-on payments to new employees.
All the Evli Group’s retirement plans are dened contri-
bution plans. Payments to dened contribution plans
are reected in prot or loss in the period in which they
are incurred. The Evli Group nances all its retirement
plans as contributions to pension insurance compa-
nies. The contributions take different countries’ local
regulations and practices into account.
1.4. COMMISSION EXPENSES 2020 2019
Trading fees paid to stock exchanges -1.8 -0.9
Other -1.3 -1.0
Commission expenses, total -3.1 -1.9
1.5. NET INCOME FROM SECURITIES TRANSACTIONS
AND FOREIGN EXCHANGE DEALING 2020 2019
Net income from securities transactions
Financial assets held for trading -0.2 0.0
Financial assets at fair value through prot or loss 0.6 2.1
Net income from securities transactions, total 0.4 2.1
Gains and
losses on sales
Changes in
fair value
Total
2020
Total
2019
Net income from securities
transactions by instrument
Debt securities -0.2 -0.6 -0.9 -0.5
Shares and derivative contracts 0.2 1.1 1.3 2.6
Net income from securities
transactions, total -0.1 0.5 0.4 2.1
Net income from foreign exchange
operations 2.0 0.0 2.0 1.1
Net income from securities transactions
and foreign exchange operations, total 1.9 0.5 2.4 3.2
1.6. INCOME FROM EQUITY INVESTMENTS 2020 2019
Dividends from nancial assets valued at fair value 0.0 0.0
Dividends from available-for-sales securities 0.0 0.0
Dividends from associated companies 0.0 0.0
Income from equity investments, total 0.0 0.0
1.7. OTHER OPERATING INCOME 2020 2019
Rental income 0.0 0.0
Gain on sale of owner-occupied investment properties 0.0 0.0
Other income 0.2 0.1
Other operating income, total 0.2 0.1
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 76 | 149
FINANCIAL REVIEW
261 persons
Men
61%
Women
39%
Employee facts
Women/Men
EMPLOYEE BENEFITS 2020 2019
Wages and salaries -24.6 -24.2
of which bonuses -4.8 -4.3
Other social security costs -1.2 -1.4
of which relating to bonuses -0.1 -0.2
Pension expenses -3.4 -4.1
of which relating to bonuses -0.3 -0.5
dened contribution plans -3.4 -4.1
Equity-settled share options -1.3 -0.6
Employee benets, total -30.5 -30.4
2020 2019
Number of personnel during the period, average 251 258
Number of personnel at the end of the period 261 249
Employees by business segment at the end of the period
Advisory and Corporate Clients 53 44
Wealth Management and Investor Clients 160 154
Group Operations 48 51
Total 261 249
Employees by geographic market at the end of the period
Finland 245 227
Sweden 15 21
Arab Emirates 1 1
Total 261 249
Employees per segment
Advisory and Corporate Clients 61%
Wealth Management and Investor Clients 20%
Group Operations 18%
261 persons
Employees per country
Finland 94%
Sweden 6%
United Arab Emirates 0.4%
261 persons
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 77 | 149
FINANCIAL REVIEW
SHARE BASED INCENTIVES
Plan
Option
program 2016
Restricted
Share Plan 2017
Restricted
Share Plan 2018
Restricted
Share Plan 2019 Total
Type Option Share Share Share
Annual General Shareholders`
Meeting date 8.3.2016 - - -
Initial amount, pcs 233.000 233,000 233,000 350,000 1,049,000
The subscription ratio
for underlying shares, pcs 1 - - -
Initial excercise price, € 8,74 - - -
Dividend adjustment Kyllä - - -
Current excercise price, € - - - -
Initial allocation date 14.6.2016 30.9.2017 8.6.2018 14.6.2019
30.9.2023 30.6.2023 30.6.2024
Vesting date 1.6.2020
30.9.2021 / 30.9.2022
/ 30.9.2023
30.6.2021 / 30.6.2022
/ 30.6.2023 30.6.2024
Maturity date 31.8.2020 - - -
Maximum contractual life, yrs 4,2 6.0 5.1 5.0 5.1
Remaining contractual life, yrs 0 2.7 2.5 3.5 2.3
Number of persons at the end of the reporting year 0 10 16 15
Payment method Equity Cash & Equity Cash & Equity
Cash & Equity
*Share subscription price is always at least EUR 2.0.
Changes during the period
Option program
2016
Restricted
Share Plan 2017
Restricted
Share Plan 2018
Restricted
Share Plan 2019
Weighted average
exercise price in € Total
1.1.2020
Outstanding at the beginning
of the reporting period, pcs 208,000 225,400 68,673 350,000 6.99 852,073
Changes during the period
Granted 0 0 68,673 0 68,673
Forfeited 0 0 0 0 0
Invalidated during the period 0 0 0 0 0
Excercised 208,000 76,670 0 0 6.99 284,670
Weighted average subscription price, € - - - - 6.99 -
Weighted average price of shares, €* - - - - 9.13 -
Expired 0 0 0 0 0
31.12.2020
Excercised at the end of the period 208,000 76,670 0 0 6.99 284,670
Outstanding at the end of the period 0 148,730 137,346 350,000 - 636,076
*Weighted average price for the company share during the reporting period or partial instrument term there in.
FAIR VALUE DETERMINATION
The fair value of share based incentives have been determined
at grant date and the fair value is expensed until vesting. The
pricing of the share based incentives granted during the
period was determined by the following inputs and had the
following effect:
Valuation parameters for instruments granted
during period
Share price at grant, € 8.62
Share price at reporting period end, € 12.20
Expected dividends, € 1.49
Fair value December 31, 2020, € 440,427
Expected volatility was determined by calculating the
historical volatility of the Group`s share using monthly
observations over corresponding maturity.
Effect of Share-based Incentives on the result
and nancial position during the period
Expenses for the nancial year, share-based
payments, equity-settled 1,314,863
Future cash payment to be paid to the tax
authorities from share-based payments,
estimated at the end of the period 3,880,064
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 78 | 149
FINANCIAL REVIEW
17.4 M€
1.9. OTHER ADMINISTRATIVE EXPENSES 2020 2019
Ofce expenses -1.3 -1.2
IT and infosystems -6.8 -6.7
Business expenses -0.5 -0.9
Travel expenses -0.3 -0.6
Car costs -0.1 -0.1
Other HR related expenses -0.5 -1.0
Marketing expenses -0.6 -0.7
Banking and custodian expenses -0.8 -1.2
External services -1.6 -1.6
Other administrative expenses, total -12.4 -14.0
1.11. DEPRECIATION, AMORTIZATION AND IMPAIRMENT LOSSES 2020 2019
Depreciation and amortization
Applications and software -2.3 -2.0
Other intangible assets -0.9 -1.1
Leasehold improvements -0.1 -0.1
Leasing -2.0 -0.0
Assets acquired under nance leases -0.1 -0.2
Equipment and furniture -0.2 -0.2
Depreciation, amortization and impaiment losses, total -5.7 -3.6
Write-downs
Impairment of goodwill 0.0 0.0
1.10. OTHER OPERATING EXPENSES 2020 2019
Supervision expenses -0.7 -0.7
Rental expenses -0.5 -2.8
Other expenses -0.6 -0.2
Other operating expenses, total -1.7 -3.7
1.12. EXPECTED CREDIT LOSSES ON LOANS AND OTHER COMMIT-
MENTS AND IMPAIRMENT LOSSES ON OTHER FINANCIAL ASSETS 2020 2019
Claims on the public and public sector entities
Expected credit losses on group level -0,1 0,0
Expected credit losses individual 0,0 -0,1
Guarantees and other off-balance sheet commitments 0,0 0,0
Sales receivables 0,0 0,0
Realised loan losses -0,1 0,0
Impairment losses on other nancial assets 0,0 0,0
Impairment losses, total -0,1 -0,1
1.13. SHARE OF PROFIT OR LOSS OF ASSOCIATE COMPANIES 2020 2019
Northern Horizon Capital A/S 0.4 -0.6
Management judgment
Evli does not participate in daily management of associated companies’ business operations, and instead focuses
on inuencing strategic decisions at the board level. At the time of preparing Evli’s consolidated nancial state-
ments, the income statement and balance sheet of associated companies are not yet known, which is why Evli’s
management must use judgment in estimating the share of associated companies’ prot for the nancial year.
The estimate is based on the most recent known prot performance, prior experience of possible last-minute
changes, and other possible factors that indicate changes.
Depreciation breakdown by asset class
Applications and software 37%
Other intangible assets 55%
Leasehold improvements 1%
Assets acquired under nance leases 1%
Equipment and furniture 6%
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 79 | 149
FINANCIAL REVIEW
1.14. INCOME TAXES
Accounting policies
The prot and loss account’s tax expenses comprise current and deferred tax. Current tax is calculated on the
taxable prot for the period determined on the basis of the enacted tax rate of each country, adjusted by any
taxes related to previous periods.
Deferred tax is generally calculated on all temporary differences between the carrying amount of an asset or lia-
bility in the balance sheet and its tax base. The largest temporary differences arise from the depreciation of xed
assets and tax losses. No deferred tax is recognized on the undistributed prots of subsidiaries to the extent it
is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax is measured
by using the tax rates enacted by the balance sheet date.
As both A and B series shares entitle holders to equal amounts of the company’s prot, these are not shown
separately.
INCOME TAXES 2020 2019
Current tax expense -5.9 -4.9
Taxes from previous years -0.4 -0.1
Deferred taxes 0.1 0.1
Other taxes 0.0 0.0
Income taxes, total -6.3 -4.9
Reconciliation between the income tax expense recognized in the
income statement and the taxes calculated using the parent company’s
domestic tax rate.
Prot/loss before taxes, Finland 28.2 22.3
Prot/loss before taxes, other countries 1.3 1.2
Prot/loss before taxes, total 29.5 23.5
Tax at domestic tax rate -5.9 4.7
Effect of foreign subsidiaries' differing tax rates -0.2 0.0
Income not subject to tax 0.0 -0.2
Expenses not deductible for tax purposes 0.0 0.4
Taxes from previous years -0.4 0.1
Change in other deferred tax assets 0.1 -0.1
Other taxes 0.0 0.0
Income tax charge in the consolidated income statement -6.5 4.9
1.15. EARNINGS PER SHARE 2020 2019
Prot for the year attributable to shareholders in Evli Bank Plc 21.31 17.26
Avarage number of A-shares 14,898,070 15,244,899
Avarage number of B-shares 9,107,351 8,550,271
Earnings / Share (EPS) 0.90 0.73
Share and option rights for share-based incentive programs 636,076 852,073
Earnings per Share (EPS), fully diluted, € 0.87 0.71
Comprehensive income attributable to shareholders in Evli Bank Plc 21.48 17.25
Comprehensive Earnings per Share (EPS), fully diluted, € 0.88 0.71
Earnings per share (EPS), fully diluted,
Five-year development
20202016 2017 2018 2019
0,69 0,68
0,71
0,87
0,42
0
0,20
0,40
0,60
1,00
0,80
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 80 | 149
FINANCIAL REVIEW
Notes to balance sheet
2.1. CASH AND CASH EQUIVALENTS 2020 2019
Balances with central banks 331.5 305.5
Other 0.1 0.2
Cash and cash equivalents total 331.6 305.7
2.2. CLAIMS ON CREDIT INSTITUTIONS 2020 2019
Repayable on demand
Domestic credit institutions 5.5 5.6
Foreign credit institutions 1.2 0.1
Repayable on demand, total 6.7 5.6
Other than repayable on demand
Domestic credit institutions 24.0 19.4
Foreign credit institutions 36.1 44.7
Other than repayable on demand, total 60.1 64.1
Claims on credit institutions, total 66.8 69.8
2.3. CLAIMS ON THE PUBLIC AND PUBLIC SECTOR ENTITIES BY SECTOR 2020 2019
Repayable on demand
Financial and insurance corporations 0.0 0.4
Repayable on demand, total 0.0 0.4
Other than repayable on demand
Enterprises and housing associations 27.0 25.0
Financial and insurance corporations 0.9 0.7
Households 71.8 74.5
Foreign countries 9.9 13.4
Other than repayable on demand, total 109.6 113.6
Claims on the public and public sector entities by sector, total 109.6 114.0
2.4. DEBT SECURITIES 2020 2019
Issued by public corporations
Publicly
quoted Other Total Total
Local government notes 0.0 8.0 8.0 220.0
Issued by other than public corporations 0.0 8.0 8.0 220.0
Issued by other than public corporations
Fair valued
Bonds issued by banks 37.2 0.4 37.5 37.5
Other debt securities 0.0 1.4 1.4 6.1
Issued by other than public corporations 37.2 1.8 38.9 43.7
Debt securities, total 37.2 9.8 46.9 263.7
2020 2019
Debt securities by balance sheet category
Debt securities eligible for refinancing with central banks
On public sector entities 0.0 0.0
Other 37.2 36.1
Debt securities
On public sector entities 8.0 220.0
Other 1.8 7.6
Total 46.9 263.7
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 81 | 149
FINANCIAL REVIEW
2.5. SHARES AND PARTICIPATIONS
2020
Balance sheet category Publicly quoted Other Total
Shares and participations
Valued at fair value through profit or loss
Held for trading 0.1 0.0 0.1
Other 49.9 7.2 57.0
Shares and participations, total 50.0 7.2 57.1
2019
Balance sheet category Publicly quoted Other Total
Shares and participations
Available for sale
Valued at fair value through profit or loss
Held for trading 0.0 0.0 0.0
Other 24.9 6.5 31.4
Shares and participations, total 24.9 6.5 31.4
Net risk position is described in section Market Risk, Notes on Risk Position.
Debt securities by country 2020 2019
Finland 30.6 247.2
Sweden 11.0 15.0
France 0.0 1.4
Denmark 5.3 0.0
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 82 | 149
FINANCIAL REVIEW
Accounting policies
The Group has treated derivative financial instruments in
accordance with IFRS 9 Financial Instruments. Derivative
financial instruments are initially recognized at cost, which
corresponds to their fair value. Subsequently derivative
financial instruments are measured at fair value. Resulting
gains and losses are treated in accordance with the pur-
pose of the derivative instrument. Positive changes in the
value of derivative contracts are recognized in the balance
sheet as assets and negative changes as liabilities.
The company does not apply hedge accounting, and
derivative financial instruments are classified as held for
trading. Changes in the value of derivatives in this cate-
gory during the year and the realized gains/losses are pre-
sented in the income statement under net income from
securities trading.
Equity derivatives in the banking book hedge the equity
risk in equity-linked bonds issued to the public.
The interest rate derivatives hedge the interest rate risk in
liabilities in the balance sheet.
Currency derivatives comprise commitments made against
clients and the associated hedges, and contracts made to
hedge currency risk in the balance sheet. The net open risk
position of the total amount is small. The largest part of
the contracts are in SEK (3,569 M€), and in USD (475 M€).
2.6. DERIVATIVE CONTRACTS
Overall effect of risks associated with derivative contracts
Nominal value of underlying , gross 2020 2020
Remaining maturity
Held for trading
Less than
1 year
1-5 years 5-15 years
Fair value
(+/-) ASSETS LIABILITIES
Interest rate derivatives
Interest rate swaps 2.1 100.7 2.2 0.0 1.0 1.0
Equity-linked derivatives
Futures 0.7 3.4 0.0 0.0 0.0 0.0
Options bought 0.0 0.0 0.0 0.0 0.0 0.0
Options sold 0.0 0.0 0.0 0.0 0.0 0.0
Currency-linked derivatives 4,555.2 32.1 0.0 0.1 51.1 51.0
Held for trading, total 4,558.0 136.1 2.2 0.1 52.2 52.0
Derivative contracts, total 4,558.0 136.1 2.2 0.1 52.2 52.0
Overall effect of risks associated with derivative contracts
Nominal value of underlying , gross 2019 2019
Held for trading
Interest rate derivatives
Interest rate swaps 2.4 82.1 18.9 0.0 4.4 4.4
Equity-linked derivatives
Futures 3.4 4.1 0.0 0.0 0.2 0.2
Options bought 3.7 0.0 0.0 0.3 0.3 0.0
Options sold 3.7 0.0 0.0 -0.3 0.0 0.3
Currency-linked derivatives 5.745.5 11.4 0.0 -0.1 54.7 54.8
Held for trading, total 5,758.7 97.7 18.9 -0.1 59.6 59.7
Derivative contracts, total 5,758.7 97.7 18.9 -0.1 59.6 59.7
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 83 | 149
FINANCIAL REVIEW
Goodwill
Goodwill represents the excess of the cost of an
acquired entity over the Group’s interest in the fair value
of the identifiable net assets and liabilities acquired at
the acquisition date. Goodwill is measured at historical
cost less cumulative impairment losses. Goodwill is not
amortized. Goodwill arising in connection with acquisi-
tions is tested annually or whenever events or changes
in circumstances indicate that the carrying amount may
not be recoverable. For this purpose, goodwill is allo-
cated to cash-generating units, or, in the case of a sub-
sidiary, goodwill is included in the subsidiary’s acquisi-
tion cost and the subsidiary forms a cash-generating
unit. If the carrying amount of goodwill for a cash-gene-
rating unit exceeds its recoverable amount, an impair-
ment loss equal to the difference will be recognized.
For the testing of impairment, the recoverable
amounts of an asset are determined by calculating the
asset’s value in use. The calculations are based on five-
year cash flow plans approved by the management.
In the cash flow model, items affecting each cash-gene-
rating unit’s operational cash flow – mainly income and
expenses – are examined. Cash flows extending after
the five-year forecast period have been calculated
using the “final value method”.
The income and expenses of each asset are estimated
based on the management’s understanding of future
development. Generally, income is expected to grow
moderately by 0-7 percent annually during the finan-
cial year.Correspondingly, expenses are expected to
grow by around two percent annually.
In the final value method growth is determined using
the management’s conservative
2.7. GOODWILL
Accounting policies
assessment of the long-term growth of cash flow. In
the testing carried out in 2020, annual growth of either
one or two percent, depending on the risk of the unit
tested, has been used as the growth factor of the final
value. The cash flows used to measure value in use
are discounted to the present value using the dis-
count rate that reflects assessments of the time value
of money and the risks specific to the asset. The dis-
count rate used in the testing of business functions
was eleven percent.
In conjunction with goodwill testing, the sensitivity of
the testing to changes in the variable affecting each
result is also assessed. Sensitivity analyses are per-
formed on goodwill impairment testing calculations
using worst-case scenario forecasts. These scenarios
were used to examine the change in value in use by
changing the basic assumptions in the definition of
value. Future income and expense cash flows, the dis-
count rate and final value growth rate were changed
in the sensitivity analyses. Among others, the following
tests were performed:
• income expectations for the five-year period under
review were stressed using 20 percent lower return
assumptions than originally assumed;
• The cost trend was stressed using 30 percent
higher cost-development than originally assumed
• The terminal value was set at 0 percent
• The discount rate was increased by 3 percent
On the basis of the sensitivity analyses carried out,
the change in the recoverable amount for the units
tested does not lead to a situation in which the carry-
ing amount is greater than the value in use.
Management judgment
Impairment testing of goodwill is based on the esti-
mated future recoverable net cash flows of the cash
generating units to which goodwill has been allo-
cated, which is then compared to this units’ carrying
amounts. The testing requires making of assump-
tions concerning variables such as the growth rate of
returns, costs of operations and the discount rate at
which the incoming cash flows are converted to the
current value.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 84 | 149
FINANCIAL REVIEW
Intangible assets
Intangible assets are recognized in the balance sheet
only if their acquisition cost can be reliably measured
and if it is probable that the expected future economic
benefits attributable to the assets will flow to the com-
pany. Intangible assets with definite useful lives are
recognized in the balance sheet at historical cost
and are amortized in the profit and loss account on a
straight-line basis over their known or estimated useful
lives. Intangible assets include software licenses and
other intangible rights whose useful life is 3-5 years.
Impairment of tangible and intangible assets
At each balance sheet date the Group assesses
whether there is any indication that an asset may be
impaired. If any such indication exists, the recoverable
amount of the asset is estimated. In addition, good-
will and intangible assets not yet available for use are
tested for impairment annually, regardless of the exis-
tence of indication of impairment. The need for
impairment is assessed for each cash-generating unit.
The recoverable amount is the higher of an asset’s
fair value less costs to sell and its value in use. The
value in use is determined as the future net cash
flows expected to be derived from the said asset or
cash-generating unit which are discounted to present
value. The discount rate used is a pre-tax discount rate
that reflects current market assessments of the time
value of money and the risks specific to the asset.
An impairment loss is recognized if the carrying
amount of an asset is higher than its recoverable
amount. The useful life of the asset is reviewed when
the impairment loss is recognized. An impairment
loss is reversed if circumstances have changed and
the recoverable amount has changed since the date
of recognizing the impairment loss. Impairment losses
recognized for goodwill are not reversed under any
circumstances.
Management judgment
At each balance sheet date management assesses
whether there is any indication that an asset may be
impaired. If any such indication exists, the recoverable
amount of the asset is estimated
Accounting policies
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FINANCIAL REVIEW
INTANGIBLE ASSETS AND GOODWILL 2020 2019
Goodwill
Cost at 1.1. 5.0 5.9
Increases/Decreases 4.3 2.0
Cost at 31.12. 9.3 7.9
Accumulated depreciation at 1.1. 0.0 -3.0
Impairment losses for the period 0.0
Accumulated depreciation at 31.12. 0.0 -3.0
Book value at 31.12. 9.2 4.9
Goodwill allocation
Administration of incentive programs 60%
Fund management 5%
Private Banking 13%
Alternative investment funds 22%
SOFTWARE OR PROJECTS IN PROGRESS 2020 2019
Cost at 1.1. 0.1 2.0
Increases/Decreases -0.1 -1.9
Cost at 31.12. 0.0 0.1
Book value at 31.12. 0.0 0.1
Applications and software 2020 2019
Cost at 1.1. 23.3 18.7
Increases/Decreases 0.7 4.7
Cost at 31.12. 24.1 23.3
Accumulated amortisation and impairment losses at 1.1. -15.4 -13.6
Amortisation for the period -2.3 -1.8
Accumulated amortisation and impairment losses at 31.12. -17.7 -15.4
Book value at 31.12. 6.4 7.9
Other intangible assets
Cost at 1.1. 7.1 6.4
Increases/Decreases 0.0 0.7
Cost at 31.12. 7.1 7.1
Accumulated amortisation and impairment losses at 1.1. -5.9 -4.8
Amortisation for the period -0.9 -1.0
Accumulated amortisation and impairment losses at 31.12. -6.7 -5.9
Book value at 31.12. 0.3 1.2
The most significant “Other intangible assets” are client relationships.
Book value of intangible assets at 31.12. 16.0 14.3
Intangible assets, total at 31.12. 16.0 14.3
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2.8. PROPERTY, PLANT AND EQUIPMENT
Accounting policies
Tangible fixed assets are measured at historical cost
less accumulated depreciation and impairment losses.
Subsequent costs are included in the carrying amount
of tangible fixed assets only if it is probable that the
future economic benefits attributable to the assets
will flow to the Group and that the cost of acquiring
the assets can be reliably measured. Other repair and
maintenance costs are recognized in profit or loss in
the period in which they were incurred.
Assets are depreciated on a straight-line basis over
their estimated useful lives. The estimated useful lives
are as follows:
• Machinery and equipment: 5 years
• IT equipment: 3 years
• Assets under finance leases: 3-5 years
• Renovations of leased premises: term of lease
The residual values and useful lives of assets are
reviewed at each reporting date and, if necessary, are
adjusted to reflect changes occurring in expectations
of useful life.
The depreciation of an item of property, plant and
equipment will cease when the tangible fixed asset
is classified as held for sale under IFRS 5 Non-current
assets held for sale and discontinued operations.
Gains and losses from the sales or disposals of tan-
gible fixed assets are included in other operating
income and expenses.
Property, plant and equipment 2020 2019
Equipment and furniture
Cost at 1.1. 1.7 1.5
Increases/Decreases 0.2 0.2
Cost at 31.12. 1.9 1.7
Accumulated depreciation at 1.1. -1.2 -0.9
Depreciation for the period -0.3 -0.2
Accumulated depreciation at 31.12. -1.4 -1.2
Book value at 31.12. 0.5 0.5
Property, plant and equipment 2020 2019
Assets acquired under finance leases
Cost at 1.1. 3.7 3.5
Increases/Decreases 0.1 0.1
Cost at 31.12. 3.7 3.7
Accumulated depreciation at 1.1. -3.5 -3.3
Depreciation for the period -0.1 -0.2
Accumulated depreciation at 31.12. -3.6 -3.5
Book value at 31.12. 0.2 0.2
Property, plant, and equipment, total 31.12. 0.7 0.7
Leasehold improvements
Cost at 1.1. 1.4 1.4
Cost at 31.12. 1.4 1.4
Accumulated depreciation at 1.1. -1.1 -1.0
Depreciation for the period -0.1 -0.1
Accumulated depreciation at 31.12. -1.3 -1.1
Book value at 31.12. 0.1 0.3
Other tangible assets
Cost at 1.1. 0.6 0.6
Cost at 31.12. 0.6 0.6
Book value at 31.12. 0.6 0.6
Property, plant and equipment, total at 31.12. 1.4 1.6
Book value of tangible assets at 31.12. 1.4 1.6
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2.9. OTHER ASSETS 2020 2019
Securities sale receivables 0.2 2.1
Commission receivables 19.9 14.8
Securities broking receivables 52.9 26.1
Other receivables 0.7 12.3
Other assets total 73.7 55.3
2.10. ACCRUED INCOME AND PREPAYMENTS 2020 2019
Interest 0.4 0.4
Taxes 0.5 1.5
Staff-related 0.1 0.1
Other items 2.4 1.6
Accrued income and prepayments total 3.3 3.6
2.11. DEFERRED TAXES
Management judgment
The entry of deferred tax assets in the balance sheet calls for judgment. Deferred tax assets are recognized to
the extent that future taxable income is likely to be generated, against which the confirmed losses can be used.
The impairment of deferred tax assets may be necessary if the future taxable income does not correspond with
the estimate. Deferred tax assets are assessed annually in relation to the Group’s ability to generate sufficient
taxable income in the future.
DEFERRED TAXES 2020 2019
Tax assets
Due to timing differences* 0.0 0.1
Other temporary differences
From tax losses carried forward 0.1 0.1
Deferred taxes total 0.1 0.2
*Deferred tax assets result from timing differences in fixed asset depreciation.
2.12. LIABILITIES TO CREDIT INSTITUTIONS AND CENTRAL BANKS 2020 2019
Credit institutions
Repayable on demand 0.0 0.2
Other than repayable on demand 0.7 1.7
Liabilities to credit institutions and central banks, total 0.7 1.9
2.13. LIABILITIES TO THE PUBLIC AND PUBLIC SECTOR ENTITIES 2020 2019
Deposits
Repayable on demand 385.1 551.5
Other than repayable on demand 0.1 0.1
Other liabilities
Repayable on demand 0.0 0.0
Other than repayable on demand 0.0 0.0
Liabilities to the public and public sector entities, total 385.2 551.6
2.14. DEBT SECURITIES ISSUED TO THE PUBLIC 2020 2019
Certificate of deposits 10.0 25.0
Bonds 121.1 123.6
Debt securities issued to the public, total 131.1 148.6
Changes in bonds issued to the public
Issues 31.7 49.5
Repurchases 34.4 44.3
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FINANCIAL REVIEW
2.15. DERIVATIVE CONTRACTS AND OTHER LIABILITIES
HELD FOR TRADING 2020 2019
Derivative contracts 52,0 59.7
Due to short selling of shares 0,4 0.0
Derivative contracts and other liabilities held for trading, total 52,5 59.7
2.16. BREAKDOWN OF OTHER LIABILITIES 2020 2019
Securities broking liabilities 54.7 32.3
Securities purchase liabilities 0.0 15.0
Finance lease payables 0.2 0.2
Income tax payable 0.0 0.1
Personnel related 0.7 0.7
Other short-term liabilities 3.4 2.9
Lease liability 9.6 4.9
Current lease liabilities 2.2 2.2
Non-current lease liabilities 7.3 2.7
Prepayments of cash customers 14.0 0.9
VAT payable 1.8 0.9
Other liabilities, total 84.4 58.0
2.17. ACCRUED EXPENSES AND DEFERRED INCOME 2020 2019
Interest 0.1 0.3
Tax payables 1.8 1.3
Personnel related 11.6 10.2
Other accrued expenses 9.8 9.8
Accrued expenses and deferred income, total 23.3 21.7
2.18. DEFERRED TAX LIABILITIES 2020 2019
Due to timing differences 0.0 0.0
Deferred tax liability, total 0.0 0.0
2.19. EQUITY CAPITAL
Accounting policies
Equity capital
The cost of treasury shares acquired by the parent company is deducted from equity. When such shares are
sold later, all consideration received is included in equity.
Share premium fund
The share premium fund comprises the following items: the amount exceeding the counter-book value of the
share paid for shares prior to September 1, 2006 in a new issue.
Fund of invested non-restricted equity
The fund of invested non-restricted equity includes the proceeds from the disposals of own shares received
after September 1, 2006, the amount paid for a subscription right based on an option right and redemptions
of own shares.
Own shares held by the credit institution
The company has not acquired own shares during the review period. On December 31, 2020 the company held
a total of 328,998 own shares.
2.19. EQUITY CAPITAL 2020 2019
Share capital 30.2 30.2
Share premium fund 1.8 1.8
Restricted equity 32.0 32.0
Reserve for invested unrestricted equity 22.8 18.7
Retained earnings 1.1. 29.3 25.9
Dividends -15.3 -14.4
Translation difference and other changes in retained earnings 1.6 0.6
Retained earnings 31.12. 15.6 12.1
Profit for the period 21.9 17.2
Unrestricted equity for shareholders 60.4 48.1
Non-controlling interest in capital 3.0 1.7
Equity capital 95.4 81.8
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Breakdown of off-balance sheet
commitments
Accounting policies
Segment reporting
Segment information is reported in accordance with
the Group’s division of business and geographical
segments. The business segments consist of business
units whose products and services and earnings logic
and profitability differ from one another. The business
risks related to the business segments are also diffe-
rent. Evli’s operations are divided by client type and
services into two segments: The Wealth Management
and Investor Clients segment and the Advisory and
Corporate Clients segment. Operations not included
above are classified as Group Operations, and the
business segments mentioned above make use of
these operations.
The Wealth Management and Investor Clients seg-
ment offers personal asset management services to
present and future high net worth private individuals
and institutions. The comprehensive product and ser-
vice selection includes wealth management services,
fund products offered by Evli and its partners, and var-
ious capital market services and alternative investment
products. The segment also includes production and
implementation activities that directly support core
activities.
The Advisory and Corporate Clients segment provides
services related to M&A transactions, including corpo-
rate acquisitions and divestments, and advisory ser-
vices related to IPOs and share issues. The segment
also offers incentive plan design and administration as
well as corporate analysis for listed companies.
The Group Operations segment includes support
functions serving the business areas, such as Informa-
tion Management, Financial Administration, Market-
ing, Communications and Investor Relations, Legal
Department, Human Resources and Internal Services.
Banking services and the company’s own investment
operations that support the company’s operations,
and the Group’s supervisory functions; Compliance,
Risk Management and Internal Audit, are also part of
Group Operations.
Inter-segment pricing occurs in arm’s length trans-
actions at fair value. The revenue and expenses that
are deemed as directly attributable to or can be allo-
cated on a reasonable basis to a particular business
area are allocated to that business area. The revenue
and expenses that are not allocated to a particular
business area, and the inter-business-area eliminations
in the Group, are reported under Group Operations.
The distribution of the Group’s assets and liabilities
among the business areas is not monitored on a regu-
lar basis and is therefore not reported in connection
with the segment reporting.
In addition to business segments, the Group uses geo-
graphical areas in monitoring revenue: Finland, Swe-
den and other countries.
Segment reporting
3.1. BREAKDOWN OF OFF-BALANCE SHEET COMMITMENTS 2020 2019
Commitments given to a third party on behalf of a customer* 5.4 6.9
Irrevocable commitments given in favour of a customer 2.3 0.3
Guarantees on behalf of others 0.0 0.5
Unused credit facilities, given to clients 9.6 5.4
*Commitments given to a third party on behalf of a customer include collaterals for derivatives positions given on
behalf of customers. The customers have covered their derivatives collateral to Evli in full. Other irrevocable com-
mitments given on behalf of a customer comprise subscription commitments guaranteed on behalf of customers.
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4.1. SEGMENT INCOME STATEMENT 2020 2019
Investor
Clients
Corporate
clients
Group
Operations Unallocated
Cost Center
Group
Investor
Clients
Corporate
clients
Group
Operations Unallocated
Cost Center
Group
REVENUE
Net Interest Income 0.0 0.0 0.2 0.0 0.2 0.0 0.0 0.3 0.0 0.3
Commission income and expense, net 67.2 9.7 0.0 0.0 76.8 61.6 11.0 0.0 -0.3 72.2
Net income from securities transactions and foreign exchange
dealing -0.1 0.0 2.5 0.0 2.4 0.0 0.0 3.2 0.0 3.2
Other operating income 0.0 0.1 0.2 0.0 0.2 0.0 0.0 0.1 0.0 0.1
External sales 67.1 9.7 2.8 0.0 79.7 61.6 10.9 3.6 -0.3 75.8
Inter-segment sales 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Total revenue 67.1 9.7 2.8 0.0 79.7 61.6 10.9 3.6 -0.3 75.8
Timing of revenue recognition
Over time 52.0 5.4 0.0 0.0 57.4 52.7 5.1 0.0 -0.3 57.5
At a point of time 15.2 4.3 0.0 0.0 19.4 8.9 5.8 0.0 0.0 14.7
RESULT
Segment operating expenses -30.3 -6.6 -8.9 1.1 -44.7 -30.3 -6.6 -11.3 0.2 -48.0
Business units operating profit before depreciations
and Group allocations 36.9 3.1 -6.1 1.1 35.0 31.3 4.4 -7.8 -0.2 27.8
Depreciation, amortisation and write-down -3.4 -0.4 -0.5 -1.5 -5.7 -3.0 -0.3 -0.5 0.3 -3.5
Impairment losses on loans and other receivables 0.0 0.0 -0.1 0.0 -0.1 0.0 0.0 -0.1 0.0 -0.1
Business units operating profit before Group allocations 33.5 2.7 -6.7 -0.4 29.1 28.3 4.0 -8.4 0.2 24.1
Allocated corporate expenses -5.8 -0.9 6.7 0.0 0.0 -7.5 -1.2 8.7 0.0 0.0
Operating profit including Group allocations 27.7 1.8 0.0 -0.4 29.1 20.8 2.8 0.3 0.2 24.1
Share of profits (losses) of associates 0.0 0.0 0.0 0.4 0.4 0.0 0.0 0.0 -0.6 -0.6
Income taxes* -3.6 -0.7 -2.0 0.1 -6.3 -2.7 -0.8 -1.4 0.0 -4.9
Segment profit/loss after taxes 24.1 1.1 -2.0 0.1 23.2 18.2 2.0 -1.0 -0.5 18.7
Regular reporting to top management does not include breakdown of assets and liabilities of Evli Group to different business segments. Because of this, the breakdown of assets and liabilities to segments is not included in the
official segment report. Allocated corporate expenses includes cost items relating to general administration of Evli Group and banking business that are allocated to business units using allocation drivers in place at each time
of review. Group Operations comprise support functions serving the business areas, such as Information Management, Financial Administration, Marketing, Communication and Investor Relations, Legal Department, Human
Resources and Internal Services. Banking services and the company´s own investment operations, and the Group´s supervisory functions; Compliance, Risk Management and Internal Audit, are also part of Group Operations.
4.2. GEOGRAPHICAL INCOME STATEMENT
AND BALANCE SHEET 1.1.–31.12.2020 1.1.–31.12.2019
Finland Sweden Other countries Group Finland Sweden Other countries Group
Income statement
Net revenue 73.7 4.6 1.4 79.7 68.5 6.7 0.6 75.8
Balance sheet
Assets 754.0 7.7 1.2 763.0 913.7 9.2 0.3 923.2
GOVERNANCE
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FINANCIAL REVIEW
IFRS 9, Expected credit losses
IFRS 9 is a standard related to expected losses, i.e.
evaluating a substantial increase in credit risk, and the
calculation model for expected credit losses, inclu-
ding the grouping of loans for calculation. The model
includes multiple input data that are subject to consi-
deration and can have a substantial effect on the
results of the calculation model. The results produced
by the bank’s calculation model are reported regularly
in the Group’s assets and liabilities committee (Cre-
dalco). The Group’s Financial Administration together
with the Group’s Risk Control and Treasury evaluates
credit risks and maintains the calculation model.
Evaluation of substantial increase in credit risk
A key component of the IFRS 9 standard is the analy-
sis of counterparties’ credit risks and changes in credit
risks that take place after a loan is granted. The credit
risks of financial assets are under constant scrutiny
at the bank. Evli Bank monitors various factors, both
quantitative and qualitative, which are estimated to be
significant in evaluating credit risk. Estimates of future
economic trends are also taken into account. In these
estimates, factors that are accessible without unrea-
sonable expenses and effort are taken into account.
If the credit risk of a liability has grown substantially
after a loan is granted, and the credit risk has not been
estimated to be low, the liability’s risk level is raised
to phase 2, in which case the expected credit loss of
the liability or loan is estimated for the entire exer-
cise period. The risk level is also separately evaluated
for entire credit groups. The following criteria indicate
that credit risk has increased substantially:
• The payments on a receivable are delayed by more
than 30 days, for non-technical reasons
• Changes in the counterparty’s financial position,
such as a substantial deterioration of creditwor-
thiness and financial status, and payment defaults.
Information on changes in the counterparties’ finan-
cial positions is obtained automatically through the
credit investigation service
• A substantial reduction in the value of collateral; the
counterparty is unable to cover the collateral shortfall
• The loan payment plan and terms and conditions
have been rearranged because of an increase in
credit risk
• A material change for the worse in macroeconomic
factors has taken place, which would have an impact
on the counterparties’ financial position
• Other factors that have a substantial impact on
credit risk or the value of collateral.
Factors that cause a loan to be classified as phase 3
Individual loans whose values have verifiably declined
are recognized in phase 3. One or several events have
come to light with respect to the counterparty that will
have a negative impact on future cash flows. These can
include one of the following, for example:
• the company’s bankruptcy or liquidation, or other
significant financial difficulties
• payments (repayment or interest) more than 90 days
late
• counterparty declared insolvent.
Credit risk decreases after classification change
If based on all available information it is estimated
that the credit risk has decreased substantially after
the loan’s risk level has been raised to phase 2, and the
risk is at the same level as at the time of granting the
loan, the loan’s risk level can be returned to phase 1.
At the balance sheet date, the Group had a total of
EUR 1.9 million (seven loans) in lending-related assets
in phase 2.
Calculation model for expected credit losses
ECL (Expected credit losses) is an estimate, with
weighted probabilities, of the difference between the
following cash flows: Contractual cash flows of the lia-
bility – the cash flows that the bank expects to receive
from an agreement.
ECL = probability of default (PD) * LGD (total loss when
realization of collateral is included) * principal of liability
The PD on a liability is estimated for the following 12
months (phase 1 financial assets) or for the entire exer-
cise period (phase 2 and 3 financial assets).
The principals that are included in the calculation are
assets measured at amortized cost:
• promissory notes and accounts with credit facility
(receivables from the public)
• receivables from credit institutions; fixed-term
deposits
• unused credit arrangements and facilities, and gua-
rantees on behalf of others
• sales receivables
Grouping of loans for calculation
Since it is not practical or affordable to analyze the
counterparties of loans on an individual basis in credit
risk evaluation, the loan portfolio is divided into various
groups that are similar in terms of their credit risk, coun-
terparties, product type, collateral type, and exercise
period. The grouping is examined at regular intervals to
avoid evaluation errors from taking place in a situation
in which a group is no longer homogenous in terms of
its credit risk. On the balance sheet date, Evli Group had
six different loan groups in the calculation model. The
largest group was investment loans of Wealth Manage-
ment customers (70 percent of all loans).
Determining the probability of default
In the model PD indicates the probability that the bor-
rower will not perform on its future obligations, either
on the horizon of the following 12 months, or during
the entire remaining exercise period.
In phase 1, the probabilities of default are determined
at the bank at the group level as a general principle,
provided that the PD of an individual loan does not
substantially differ from the group’s PD value, and it
is not practical to set a separate group for the loan.
A simplified model has been devised for sales recei-
vable items, where the PD is determined based on
how many days late the receivable is and whether the
counterparty belongs in the normal or high-risk group.
When the PD is being determined for a counterparty,
the counterparty’s collateral is not taken into account.
At Evli, the group-level initial PD percentage for house-
hold and corporate loans has been set as the proportion
of non-performing loans out of the entire loan portfolio
in Finland. Since the bank does not have a sufficiently
comprehensive history of its own credit losses at its dis-
posal, a wider comparison group is also used, in which
the credit risk is assumed to be similar. This model is jus-
tified by the fact that Evli’s loan portfolio consists pri-
marily of Finnish household and corporate loans (over
91 percent of the total loan portfolio). The Group’s loan
portfolio is assessed as being low- risk for the most part,
which is also reflected in the average PD values. Len-
ding is focused primarily on Wealth Management clients
whose historical credit risk has been very low.
Accounting policies
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FINANCIAL REVIEW
The PD percentages of loans were between 0.41 per-
cent and 2.20 percent on the balance sheet date for
household and corporate clients, for phase 1 assets.
If a loan is transferred to phase 2, the PD is always
redefined individually. In this case, the loan’s future
cash flows are estimated for the loan’s entire exercise
period, and are discounted to the current value, giving
an estimate of the total loss on the loan before reali-
zing collateral. In phase 2 PD assessments, the assess-
ments of credit investigation services are also used.
The amount of loans in phase 2 grew during the year,
primarily because of the Coronavirus crisis.
The PD percentage of other corporate receivables,
high-risk items and credit institution receivables is
determined with a statistical risk of making a loss that
is available on the basis of credit ratings. The statisti-
cal information is obtained from credit rating agencies.
The PD percentage is also determined for off-balance
sheet liabilities. The rate of use of open unused credit
Definition of loss given default (LGD)
LGD determines the total loss when the realization of
collateral is taken into account in a payment default
situation. In the ECL calculation, the bank estimates
what the loss is in a realization situation when the
worst-case scenario materializes with the estimated
probability: do the assets from realizing the collateral
cover the loan’s remaining principal in that situation.
The worst-case scenario in the bank’s calculation is a
strong decline in prices of securities or real estate, as
was the case during the stock market crash in 2008.
The calculation takes into account the average collat-
eral value of the collateral of the loans in the group,
the type of collateral and the liquidity of the colla-
teral. The collateral values given to the collateral are
so conservative in the Group that losses will not be
realized on promissory notes except as the result of
a strong decline in share prices. LGD is determined
for loans generally at group level. LGD at a one-year
level is obtained by estimating the probability that
the worst-case scenario will materialize during the fol-
facilities is estimated to be 50 percent, which means
that the facility is included in the calculation with a
50 percent weighting compared to facilities that have
been drawn. Guarantees given on behalf of others is
treated like normal drawn credit in the calculations.
If the future holds substantial uncertainty regarding
significant declines in the prices of securities, GDP fig-
ures, increased unemployment or other economic fac-
tors, the group-level PD figures can be raised in phase
1. Because of the coronavirus situation, the propabilities
of default for all loan groups were raised, leading to a
clearly higher credit loss reserve. The credit loss reserve
where at year-end still on a reasonable low level of EUR
0.2 million (EUR 0.1 million), because of the mostly low
risk level of the loan portfolio.
The group-level PD figures are updated quarterly, and
individual PD figures immediately when an individual
liability’s credit risk is evaluated as having grown sub-
stantially, or when the credit risk of a liability is evalu-
ated as differing from the credit risk of its group.
lowing 12 months. An individual LGD can be deter-
mined for individual loans if the number or quality of
the loan’s collateral differs substantially from collateral
in the group on average.
On the balance sheet date, the LGD values for len-
ding were, depending on the group, between 5 and
30 percent, for assets measured in accordance with
the first phase.
The most important variables that affect the calcula-
tion model with respect to LGD are realized and antic-
ipated changes in prices of securities, and the esti-
mated probability of a scenario in which the clients’
collateral is no longer sufficient to cover the value of
the liability. Because of the market uncertainty and the
coronavirus situation, the LGD parameters in the ECL
model were raised at the end of March.
5.3. ITEMS MEASURED ACCORDING TO IFRS 9, EXCEPCTED CREDIT LOSSES
Financial assets and sales receivables measured at amortised cost
Asset Total amount Level 1 assets Level 2 assets Level 3 assets
Expected
credit loss
Opening saldo,
credit loss
allowance 1.1.
Cash and Central Bank receivables 331.5 331.5 0.0 0.0 0.0 0.0
Claims on credit institutions 66.8 66.8 0.0 0.0 0.0 0.0
Claims on the public and public sector entities 109.6 107.7 1.9 0.0 0.2 0.1
Claims on corporations 31.3 29.8 1.5 0.0 0.1 0.0
Claims on private persons 78.3 77.9 0.4 0.0 0.1 0.1
Claims on other 0.0 0.0 0.0 0.0 0.0 0.0
Sales receivables 2.2 2.2 0.1 0.0 0.0 0.0
Total assets 510.1 508.1 2.0 0.0 0.2 0.1
Unused credit facilities, given to clients 9.6 9.5 0.2 0.0 0.0 0.0
Credit loss reserve total 0.2 0.1 0.1 0.0 0.2 0.1
During the year eight loan receivables have been transferred from level 1 to level 2, EUR 4.2 million and three loans have been
transferred back to level 1 from level 2, EUR 2.2 million. A credit loss of EUR 0.1 million was realized during the review period. The
bank has no credit payment receivables past due by at least 90 days. Expected credit loss is booked to the Income Statement.
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Notes on risk position
The credit rating institutions used in the standard method are Standard & Poor’s, Moody’s and Fitch. Their
credit ratings are used to assign risk weights for credit institutions and corporations. If a credit rating is not
available, the risk weight is assigned in accordance with the credit quality group of the home country of the
institution.
The Treasury function’s investments in debt instruments are focused at Nordic bank bonds, whose credit rating
is at minimum A, at corporate bonds and at short term investments like local government notes and
commercial papers. In the capital adequacy calculations, 17 percent of the investments had a risk weight of 0
percent, 65 percent a risk weight of 20 percent, 15 percent a risk weight of 50 percent, and 3 percent had a risk
weight of 100 percent. Total investments in debt instruments was at year-end EUR 47 million, additionally
treasury has invested EUR 48 million in interest rate mutual funds.
6.2. TECHNIQUES TO REDUCE CREDIT RISK
The valuation of collateral uses the credit and asset liability committee, Credalco’s approved collateral factors
that are based on the collateral’s realizability and susceptibility to changes in value.
The goal is to receive liquid collateral, which can also be used as risk-reducing collateral in the capital
adequacy calculations. Credalco decides the maximum amount of illiquid collateral which can be accepted per
customer. Only in certain special cases, can the Bank deviate from the normal process for accepting collateral.
Principal real collateral types used in capital adequacy calculation:
• Residential property collateral
• Cash deposits
• Bonds issued by Evli
Evli does not use master netting agreements or similar agreements in capital adequacy calculation.
Exposures hedged with approved collateral
in capital adequacy calculation 2020 2019
Mortgages 3.1 2.7
Other credits 26.4 35.4
Counterparty exposure of OTC derivatives hedged with collateral 51.6 60.5
6.1. GENERAL INFORMATION ON CREDIT AND DILUTION RISK (STANDARD MODEL)
Lending, exposure per geographic area and non-performing credits
Exposure and home country Lending stock
Average
remaining
maturity years
Overdue by at
least 90 days Impaired loans
Private Persons Finland 71.8 1.5 0.0 0.0
Corporations Finland 27.9 2.0 0.0 0.0
Other sectors Finland 0.0 0.0 0.0 0.0
Private persons EU countries 3.9 1.9 0.0 0.0
Corporations EU countries 3.4 0.8 0.0 0.0
Private persons other countries 2.6 1.3 0.0 0.0
Total 109.6 1.6 0.0 0.0
Loans are entered as non-performing if payment of interest or instalments are overdue by at least 90 days, or if
it is estimated that the debtor is propably not going to be able to manage the loan commitments. There were
no non-performing loans at year-end, and no loan payments overdue by at least 90 days in the loan stock by
31.12.2020. One non-performing loan expired during the year, and was written off as a realised loan loss, to the
amount of EUR 0.1 million.
The goal of the lending is to support customer relations and the Bank’s main businesses. At the same time, the
risk corrected income from lending has to be sufficient.
Lending is focused on wealth management customers. Domestic private customer’s share of the loan stock
was 65 percent and foreign private customer’s share was 6 percent.
Exposure by risk weight, credit risk standard model
Risk weight -%
Original
exposure value
Credit risk
reducing
collateral
Exposure value
after credit risk
deductions
Risk-weighted
value
0 340.2 0.0 340.2 0.0
20 140.3 -0.7 139.5 27.9
35 3.1 0.0 3.1 1.1
50 11.4 0.0 11.4 5.7
76 15.2 0.0 15.2 11.6
100 244.5 -77.3 165.9 165.9
150 0.9 0.0 0.9 1.3
Exposure by risk weight, total 755.6 -78.0 676.2 213.4
Credit value adjustment 1.4 0.0 1.4 1.4
Total 757.0 -78.0 677.6 214.8
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6.3. CREDIT RISK (COUNTERPARTY RISK) 2020 2019
Positive fair value of OTC derivatives in the financial statement 52.2 59.6
The derivatives comprise equity, currency and fixed income derivatives
Collateral reducing counterparty risk in capital adequacy calculations 51.6 60.5
After the collateral-reducing effect the credit counter-value
of derivatives totaled 47.1 54.4
Exchange traded derivatives OTC derivatives
2020
Nominal
value
Fair
value
Nominal
value
Fair
value
Derivatives assets 0.0 0.0 2,301.7 52.2
Derivatives liabilities 0.0 0.0 2,394.7 -52.0
Exchange traded derivatives OTC derivatives
2019
Nominal
value
Fair
value
Nominal
value
Fair
value
Derivatives assets 0.0 0.0 2,916.3 59.6
Derivatives liabilities 0.0 0.0 2,959.0 59.7
6.4. MARKET RISK 2020 2019
Minimun capital adequacy requirement, trading book
Position risk total 0.1 0.0
Position risk equity instruments 0.1 0.0
Position risk debt instruments 0.0 0.0
Settlement risk 0.0 0.0
Minimun requirement for the currency risk of all operations 0.4 0.3
Total 0.5 0.3
Net positions in trading book, equity instruments
Long net positions 0.1 0.0
Short net positions -0.4 0.0
Net total -0.3 0.0
Net positions in trading book, debt instruments
Long net positions 0.4 0.0
Short net positions 0.0 0.0
Net total 0.4 0.0
Net positions in currencies
Swedish krona 4.0 3.7
US dollar -2.1 0.1
Danish krona 0.0 0.1
Pound sterling -0.3 -0.1
Japanese yen 0.0 0.0
Norwegian krone -0.1 0.1
Swiss franc 0.0 -0.2
Other currency position 0.3 0.2
Total net position 1.8 4.0
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6.5. OPERATIONAL RISK
The method applied in the capital adequacy calculations is the basic indicator approach, which is based on
the Group’s revenues for the previous three years. The capital requirement is 15 percent of the average
revenue from the previous three calender years.
6.6. SHARES OUTSIDE THE TRADING BOOK
Shares and participations in the banking book are measured at fair value through profit or loss.
The value of the investments in the financial statements was EUR 57.2 million, which is the fair value of the
investments.
The listed shares are related to the equity incentive schemes, the shares don’t affect the market risk of the
bank.
Type of investment 2020 2019
Private equity funds 0.9 0.6
Real estate funds 6.1 5.6
Unlisted shares 0.3 0.4
Mutual funds 49.9 25.0
Listed shares 0.0 0.0
Total 57.2 31.5
Private equity funds, real estate funds and mutual funds have been valued by applying the last known fair
value from the funds’ management companies.
The fair value of unlisted shares is estimated primarily by using the share’s net asset value or a cah flow analysis
based on future outlooks. If no better estimate of the fair value is available, the acquisition price can be used
as the fair value.
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Other notes
7.1. MATURITIES OF FINANCIAL ASSETS AND LIABILITIES
Debt securities, loans and other claims, derivatives and financial liabilities at amortized cost are reported in the maturity class according to the maturity of the instrument. Shares and participations are reported so that quoted
shares in the trading book and quoted mutual funds are in the shortest maturity period. Unquoted shares are reported according to the estimated liquidation period, and venture capital- and real estate funds are reported
according to the expected ending day of the fund.
2020 2019
less than 3
months
3-12
month
1-5
years
5-10
years
over 10
years Total
less than 3
months
3-12
month
1-5
years
5-10
years
over 10
years Total
Assets
Cash and cash equivalents 331.6 0.0 0.0 0.0 0.0 331.6 305.7 0.0 0.0 0.0 0.0 305.7
Financial assets at amortized cost
Claims on credit institutions 66.8 0.0 0.0 0.0 0.0 66.8 69.8 0.0 0.0 0.0 0.0 69.8
Claims on the public and public
sector entities 4.9 22.7 81.2 0.7 0.0 109.6 8.7 26.9 72.4 6.1 0.0 114.0
Financial assets at fair value through
profit or loss
Debt securities eligible for refinancing
with central banks 0.0 15.7 21.5 0.0 0.0 37.2 13.0 18.0 5.0 0.0 0.0 36.1
Debt securities 8.3 0.0 1.1 0.4 0.0 9.8 206.2 17.5 1.1 0.0 2.9 227.6
Shares and participations 50.6 0.8 3.3 2.5 0.1 57.3 25.0 1.6 2.7 2.1 0.2 31.5
Derivative contracts 51.1 0.0 1.0 0.0 0.0 52.2 54.5 0.5 3.8 0.8 0.0 59.6
Accrued interest 0.3 0.1 0.0 0.0 0.0 0.4 0.2 0.1 0.0 0.0 0.0 0.3
Liabilities
Financial liabilities at amortized cost
Liabilities to credit institutions 0.7 0.0 0.0 0.0 0.0 0.7 1.4 0.5 0.0 0.0 0.0 1.9
Liabilities to the public and public s
ector entities 385.1 0.1 0.0 0.0 0.0 385.2 551.5 0.1 0.0 0.0 0.0 551.6
Debt securities issued to the public 1.0 11.8 116.0 2.2 0.0 131.1 12.2 22.8 94.7 18.9 0.0 148.6
Financial liabilities at fair value through
profit or loss 51.4 0.0 1.0 0.0 0.0 52.5 55.4 0.5 3.8 0.0 0.0 59.7
Accrued interest, debt 0.1 0.0 0.0 0.0 0.0 0.1 0.3 0.0 0.0 0.0 0.0 0.3
Off-balance sheet commitments 5.4 3.3 6.3 0.0 0.0 15.1 8.6 2.2 1.8 0.4 0.0 13.1
Leasing 0.6 1.7 6.0 1.4 0.0 9.6 0.5 1.6 2.7 0.0 0.0 4.9
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7.2. ASSETS AND LIABILITIES DENOMINATED IN DOMESTIC AND FOREIGN CURRENCY
2020 2019
Assets Domestic currency Foreign currency Total Domestic currency Foreign currency Total
Financial assets at amortized cost
Cash and cash equivalents 331.6 0.0 331.6 305.7 0.0 305.7
Claims on credit institutions 61.3 5.5 66.8 63.8 6.0 69.8
Claims on the public and public sector entities 109.6 0.0 109.6 114.0 0.0 114.0
Financial assets at fair value through profit or loss
Debt securities eligible for refinancing with central banks 0.0 0.0 0.0 36.1 0.0 36.1
Debt securities 46.6 0.4 46.9 226.2 1.4 227.6
Shares and participations 57.1 0.2 57.3 31.2 0.4 31.5
Derivative contracts 51.9 0.2 52.2 57.8 1.8 59.6
Other asset items 85.9 22.5 108.3 64.8 14.1 78.9
Total 743.9 28.7 772.6 899.6 23.7 923.2
Liabilities
Financial liabilities at amortized cost
Liabilities to credit institutions 0.7 0.0 0.7 1.9 0.0 1.9
Liabilities to the public and public sector entities 369.8 15.5 385.2 490.3 61.4 551.6
Debt securities issued to the public 131.1 0.0 131.1 148.6 0.0 148.6
Financial liabilities at fair value through profit or loss 51.8 0.7 52.5 57.9 1.8 59.7
Other liabilities items 85.4 22.3 107.7 65.3 14.4 79.8
Total 638.7 38.5 677.2 763.9 77.6 841.5
The largest foreign currency assets and liabilities are in SEK (assets 20.2 M€, liabilities 24.5 M€) and USD (assets 3.7 M€, liabilities 7.0 M€).
Derivatives positions which hedge the foreign exchange risk are not included in these figures.
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Management judgment
In situations where no external market price is available for
individual financial instruments when valuing unquoted secu-
rities or derivatives at their fair value, a price which is calcu-
lated based on the generally approved valuation models
used on the market is generally used. Alternatively, valuation
based on net asset value is employed.
Level 1 Level 2 Level 3
Financial assets: 2020 2020 2020 Total
Shares and participations classified as held for trading 0.1 0.0 0.0 0.1
Shares and participations, other 49.9 0.0 7.2 57.2
Debt securities eligible for refinancing with central banks 37.2 0.0 0.0 37.2
Debt securities 0.3 8.3 1.2 9.8
Positive market values from derivatives 0.0 51.1 1.1 52.2
Total financial assets held at fair value 87.5 59.4 9.5 156.3
Financial liabilities:
Shares and participations classified as held for trading 0.4 0.0 0.0 0.4
Negative market values from derivatives 0.0 50.9 1.1 52.0
Total financial liabilities held at fair value 0.4 50.9 1.1 52.5
Financial assets: 2019 2019 2019 Total
Shares and participations classified as held for trading 0.0 0.0 0.0 0.0
Shares and participations, other 25.0 0.0 6.5 31.5
Debt securities eligible for refinancing with central banks 36.1 0.0 0.0 36.1
Debt securities 1.4 222.5 3.6 227.6
Positive market values from derivatives 0.0 54.4 5.2 59.6
Total financial assets held at fair value 62.5 276.9 15.4 354.8
Financial liabilities:
Shares and participations classified as held for trading 0.0 0.0 0.0 0.0
Negative market values from derivatives 0.0 54.5 5.2 59.7
Total financial liabilities held at fair value 0.0 54.5 5.2 59.7
7.3. VALUE OF FINANCIAL INSTRUMENTS ACROSS THE THREE LEVELS OF THE FAIR VALUE HIERARCHY
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Explanation of fair value hierarchies:
Level 1
Fair values measured using quoted prices in active markets for identical instruments.
Level 2
Fair values measured using directly or indirectly observable inputs, other than those included in
level 1.
Level 3
Fair values measured using inputs that are not based on observable market data.
Level 1 of the hierarchy includes listed shares, mutual funds and derivatives listed on exchanges,
and debt securities that are traded in active OTC- and public markets.
Shares and participations classified in level 3 are usually instruments which are not publicly
traded, like venture capital funds, real estate funds, equities and equity rights.
Derivatives in level 2 are forwards whose values are calculated with inputs like quoted interest
rates and currency rates.
Derivative valuations for level 3 instruments contain inputs (volatility and dividend estimate)
which are not directly observable in the market. The values are calculated with pricing models
widely in use, like Black-Scholes. Valuations received from the counterparty of the OTC trade are
classified as level 3 valuations.
Debt securities valuations that are obtained from markets that are not fully active, have a fair value
level hierarchy of 2. Level 3 valuations for debt securities are valuations for illiquid securities that are
received directly from the arranger of the issue, or the valuation is calculated by Evli Bank.
The fair values of financial instruments are defined in accordance to IFRS13. In principle,
valuation of financial instruments is based on public market quotations. For unquoted financial
instruments, Evli Bank’s Financial Administration together with the Risk Control function evaluate
and classify instruments.
Level 2 valuation methods, detailed description:
Financial instrument Valuation method/ inputs
Money market instrument, not quoted Interest rate spread to Euribor-curve, acquisition date spread
is used if no significant change has occured in the credit risk
of the instrument.
Bond instrument, no active market Bid quote (price source Bloomberg)
Derivative instruments: OTC forwards Price calculated by using the market price of the underlying
instrument, and quoted interest and currency rates.
Level 3 valuation methods, detailed description:
Financial instrument Valuation method/ inputs
Bond instrument, illiquid/not quoted Price received from arranger of issue or price calculated by
Evli Bank.
Shares, unlisted Estimate of company value calculated by using the book
value of the share, or by an estimated future cash-flow
analysis. If the share has been traded, the price level can be
used in the valuation. If no better estimate of the fair value is
available, the acquisition price can be used as the fair value.
Unlisted options, warrants and equity rights The values are calculated at Evli Bank with pricing models
widely in use. Calculation inputs which are estimated are the
volatility of the underlying instrument, and dividend estimate.
Venture capital and real estate funds Last known fair value from the funds’ management compa-
nies, valuation received four times a year. The valuation is
corrected if after the valuation date, such information has
been received of an ownership in the portfolio that
significantly will affect the value of the fund.
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7.4. ANALYSIS OF FINANCIAL INSTRUMENTS CATEGORIZED IN LEVEL 3 2020 2019
Financial assets:
Shares and participations classified as held for trading 0.0 0.0
Unlisted shares and participations 0.3 0.4
Venture capital funds and real estate funds 7.0 6.1
Debt securities 1.2 3.6
Quoted equity derivatives 0.0 0.0
OTC equity derivatives 1.1 5.2
Total financial assets held at fair value 9.5 15.4
Financial liabilities:
Shares and participations classified as held for trading 0.0 0.0
Quoted equity derivatives 0.0 0.0
OTC equity derivatives 1.1 5.2
Total financial liabilities held at fair value 1.1 5.2
Changes during the year. considering level 3 categorized instruments:
Financial assets 2020 2019
Shares and participations classified as held for trading-Initial Balance
31.12.2019 0.0 0.0
Purchases 0.0 0.0
Sales 0.0 0.0
Valuation changes 0.0 0.0
Shares and participations classified as held for trading 31.12.2020 0.0 0.0
Unlisted shares and participations-Initial Balance 31.12.2019 0.4 0.4
Purchases 0.0 0.0
Sales 0.0 0.0
Valuation changes -0.1 0.0
Unlisted shares and participations 31.12.2020 0.3 0.4
Venture capital funds and real estate funds-Initial Balance 31.12.2019 6.1 5.7
Purchases 0.3 0.9
Sales 0.0 -0.8
Valuation changes 0.6 0.4
Venture capital funds and real estate funds 31.12.2020 7.0 6.1
2020 2019
Debt securities-Initial Balance 31.12.2019 3.6 2.8
Purchases 0.1 2.2
Sales -2.0 -0.7
Valuation changes -0.6 -0.6
Debt securities 31.12.2020 1.2 3.6
OTC equity derivatives-Initial Balance 31.12.2019 4.5 0.9
Purchases 0.0 0.0
Sales -0.5 -0.3
Valuation changes -2.9 4.5
OTC equity derivatives 31.12.2020 1.1 5.2
Financial liabilities 2020 2019
Shares and participations classified as held for trading-Initial Balance
31.12.2019 0.0 0.6
Purchases 0.0 0.0
Sales 0.0 -0.6
Valuation changes 0.0 0.0
Shares and participations classified as held for trading 31.12.2020 0.0 0.0
OTC equity derivatives-Initial Balance 31.12.2019 4.5 0.9
Purchases 0.0 0.0
Sales -0.5 -0.3
Valuation changes -2.9 4.5
OTC equity derivatives 31.12.2020 1.1 5.2
Sensitivity analysis for level 3 instruments; effect of measurements to fair values
Derivative contracts
If the volatility estimate in the options pricing model for level 3 categorized options, is changed to a publicly available historical
volatility (3 months), the options market value would change by net EUR 0.0 million. Volatility is the standard deviation or variability of
the price of the underlying instrument for a given time period.
Shares and participations
When determining the fair value of unquoted instruments Evli uses estimates of the company’s future cash flows and trends. The
estimates are based on conservative estimates, and the use of other realistic alternative scenarios would not change the fair value
estimates significantly. For real estate funds, there are uncertainty factors related to the valuation of real estate that have an impact on
the fund’s NAV. The total impact on fair value in the share and participations group is under EUR -0.8 million.
Debt securities
The return requirements used in the pricing of unquoted bonds correspond to the returns of instruments with similar risk levels and
characteristics. If the discount rate used is raised by 1 percentage unit, the fair value will decline in total by less than EUR 0.1 million.
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7.5. UNREALIZED PROFIT/LOSS FOR FINANCIAL
INSTRUMENTS CATEGORIZED IN LEVEL 3
Unrealised profit/loss
2020 2019
Financial assets
Shares in trading book 0.0 0.0
Other shares 0.9 0.0
Debt securities -1.2 -0.8
Derivatives 1.0 4.6
Unrealized P/L at year-end,
financial assets 0.6 3.8
Financial liabilities
Shares in trading book
liabilities 0.0 0.0
Derivatives liabilities -1.0 -4.6
Unrealized P/L at year-end,
financial liabilities -1.0 -4.6
Unrealised profit/loss total*,
level 3 instruments -0.4 -0.8
*Total unrealized profit is recorded in net income from securities
transactions.
7.6. CLASSIFICATION OF FINANCIAL INSTRUMENTS
2020
Assets
Financial assets
measured at
amortized cost
Fair value through
profit and loss
Fair valued through
comprehensive
income Other assets Total
Cash and cash equivalents 331.6 331.6
Claims on credit institutions 66.8 66.8
Claims on the public
and public sector entities 109.6 109.6
Debt securities eligible for refinancing with
central banks 37.2 37.2
Debt securities 9.8 9.8
Shares and participations 57.3 57.3
Derivative contracts 52.2 52.2
Shares and participations in associates 4.2 4.2
Intangible assets and goodwill 16.0 16.0
Property, plant and equipment 1.4 1.4
Other assets 73.7 73.7
Leasing 9.6 9.6
Accrued income and prepayments 3.3 3.3
Deferred tax assets 0.1 0.1
Total 507.9 156.3 0.0 108.3 772.6
Liabilities
Valued at
amortized cost
Fair valued through
profit and loss Other debt Total
Liabilities to credit institutions and central banks 0.7 0.7
Liabilities to the public and public sector entities 385.2 385.2
Debt securities issued to the public 131.1 131.1
Financial liabilities at fair value through profit or loss 52.5 52.5
Other liabilities 84.4 84.4
Accrued expenses and deferred income 23.3 23.3
Deferred tax liabilities 0.0 0.0
Total 517.0 52.5 107.7 677.2
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7.7. LIQUIDITY COVERAGE REQUIREMENT (LCR)
2020
Items included in the liquidity coverage ratio
Requirement 100%
Amount/
market value Weighted value
Liquidity buffer
Central Bank deposits, withdrawable 326.7 326.7
Local government notes 8.0 8.0
Liquidity buffer total 334.7 334.7
Amount/
market value Inflow
Inflows over the next 30 days
Maturing loans, retail customers 1.5 0.8
Monies due from financial customers 1.1 1.1
Inflow Total 2.6 1.8
Amount/
market value Outflow
Outflows over the next 30 days
Retail deposits 197.0 23.7
Deposits by financial customers 74.5 74.5
Deposits by other customers 38.2 14.4
Impact of an adverse market scenario on derivatives,
financing transactions and other contracts 67.2 67.2
Credit facilities 9.6 1.5
Planned derivatives payables 0.0 0.0
Other debt 16.0 16.0
Other off-balance sheet and contingent funding obliga-
tions 0.0 0.0
Issued debt securities 1.0 1.0
Outflow total 403.6 198.4
Net liquidity outflow 196.6
LCR % = Liquidity buffer / Net liquidity outflow 170.3%
7.8. SECURITIES LENDING 2020 2019
Market value of securities lending at 31.12., lent in 2.8 0.0
Market value of securities lending at 31.12., lent out 0.0 0.0
7.9. FAIR VALUES AND BOOK VALUES OF FINANCIAL ASSETS
AND FINANCIAL LIABILITIES 2020 2020
Book value Fair Value
Financial assets
Liquid assets 331.6 331.6
Debt securities eligible for refinancing with central banks 37.2 37.2
Claims on credit institutions 66.8 66.8
Claims on the public and public sector entities 109.6 109.6
Debt securities 9.8 9.8
Shares and participations 57.3 57.3
Derivative contracts 52.2 52.2
Financial liabilities
Liabilities to credit institutions and central banks 0.7 0.7
Liabilities to the public and public sector entities 385.2 385.2
Debt securities issued to the public 131.1 129.8
Derivative contracts and other liabilities held for trading 52.5 52.5
The lending rate is tied to the Euribor rates, and so the carrying amount of loans is not considered to differ
significantly from the fair value.
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7.11. ASSETS UNDER MANAGEMENT 2020 2019
Assets under management at Evli Group
as of 31 December
Gross 15,059.0 15,716.0
Net 12,395.0 12,848.0
Assets under management on the basis of
power of attorney
Discretionary asset management 5,024.0 5,121.0
Consultative asset management 162.0 169.0
Total 5,186.0 5,290.0
7.10 ASSETS PLEDGED AS COLLATERAL
Fair value of
encumbered assets
Fair value of
unencumbered assets
of which usable as
collateral
ASSETS 2020 2020 2020
Liquid assets and Central Bank deposits 0.0 331.6 326.7
Debt securities eligible for refinancing with central banks 33.8 3.4 3.4
Claims on credit institutions 60.1 6.7 6.7
Claims on the public and public sector entities 0.0 109.6 0.0
Debt securities 0.0 9.8 0.0
Shares and participations 0.0 57.3 0.0
93.9 518.2 336.7
Usage of collateral
Markeplace collateral, stock- and derivatives trades 10.0
Collateral for OTC derivatives trades 47.3
Collateral for securities lending 2.8
Bank Of Finland, collateral for daily limit account 33.8
93.9
Received collateral
Fair value of
collateral recieved
LIABILITIES
Received cash 53.3
ASSETS 2019 2019 2019
Liquid assets and Central Bank deposits 0.0 305.7 299.0
Debt securities eligible for refinancing with central banks 34.1 2.0 2.0
Claims on credit institutions 64.1 5.6 5.6
Claims on the public and public sector entities 0.0 114.0 0.0
Debt securities 0.0 227.6 0.0
Shares and participations 0.0 31.5 0.0
98.2 686.6 306.7
Usage of collateral
Markeplace collateral, stock- and derivatives trades 12.0
Collateral for OTC derivatives trades 52.1
Collateral for securities lending
Bank Of Finland, collateral for daily limit account 34.1
98.2
Received collateral
Fair value of
collateral recieved
LIABILITIES
Received cash 65.4
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 104 | 149
FINANCIAL REVIEW
8.1. GROUP STRUCTURE
Evli Bank´s affiliated company
Northern Horizon Capital A/S, 50%
Denmark
Evli Bank Plc
Finland
Terra Nova Capital
Advisors Ltd
(90%)
United Arab Emirates
Evli Corporate
Finance AB
(59.5%)
Sweden
Evli Life Ltd
(100%)
Finland
Evli Investment
Solutions Oy
(85%)
Finland
Evli Research
Partners Oy
(70%)
Finland
Evli Fund Management
Company Ltd
(100%)
Finland
Aurator
Asset Management Ltd
(100%)
Finland
Evli Fund Management Ltd (Finland)
Stockholm Branch, Sweden
Evli Infrastructure Partners Oy (82%), Finland
EAI Residential Partners Oy (75%), Finland
EAI Feeder GP Oy (100%), Finland
Evli HC I GP Oy (82%), Finland
EGP General Partner Oy (70%), Finland
Evli Private Equity Partners Oy (80%), FinlandEvli Private Equity II GP Oy (100%), Finland
Evli Private Equity I GP Oy (100%), Finland
GROUP STRUCTURE
Group company
Branch office
Associated companies
Consolidation
Evli Infrastructure I GP Oy (100%), Finland
Evli Impact Forest I GP Oy (100%), Finland
Evli Alexander
Incentives Ltd
(65%)
Finland
Alexander Incentives Oy (100%)
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 105 | 149
FINANCIAL REVIEW
Accounting policies
General consolidation principles
Subsidiaries
The consolidated financial statements comprise the
financial statements of Evli Bank Plc and all the sub-
sidiaries in which the parent company has control. The
Group controls an entity when the Group is exposed
to, or has rights to, variable returns from its involve-
ment with the entity and has the ability to affect those
returns through its power over the entity. Subsidia-
ries are consolidated from the date on which control
is transferred to the Group. They are deconsolidated
from the date that control ceases.
The Group’s internal shareholdings are eliminated
using the acquisition method of accounting. The
assets, liabilities, contingent assets and contingent lia-
bilities of a company acquired according to the acqui-
sition method are assessed at fair value at the time of
acquisition. Intangible assets, such as trademarks, pa-
tents or client relationships, that are not included in the
acquired company’s balance sheet are identified and
assessed in connection with the acquisition. Goodwill
is recognized for the amount by which the transferred
consideration, the share of non-controlling interests of
the target of acquisition and the previously held share
of the target of acquisition exceed the Group’s share
of the fair value of acquired net assets and liabilities.
All intra-group transactions, receivables, liabilities,
unrealized gains and internal distribution of profits
are eliminated in preparing the consolidated finan-
cial statements. Unrealized losses are not eliminated
if the loss is due to impairment of an asset. The profit
for the period attributable to the parent company’s
equity holders and non-controlling interests is pre-
sented in the income statement. The non-controlling
interests’ share of equity is presented separately in the
balance sheet within equity. Comprehensive income
is allocated to the parent company’s owners and to
non-controlling interests even if this would lead to
the non-controlling interests’ share becoming nega-
tive, unless the non-controlling interests have an
exemption not to meet obligations which exceed the
non-controlling interests’ investment in the company.
Associated companies
The consolidated financial statements encompass those
associates in which the parent company directly or indi-
rectly owns 20-50 percent of the shares with voting rights
or in which it otherwise exercises significant influence,
but not control. Associates are consolidated using the
equity method. The Group’s share of associates’ profit is
presented separately in the income statement.
Companies outside the Group
Subsidiaries and associated companies in which the
Group has a majority holding but in which a third party
has control are not consolidated in the consolidated
financial statements. In addition, holding companies
owned in connection with the management of cus-
tomer company incentive programs have not been
consolidated. Evli is not entitled to the variable returns
of these holding companies and Evli does not bear the
risk of the companies’ assets or liabilities.
Mutual funds managed on behalf of clients are also not
consolidated, since the Group has no control over them.
Related party disclosures
The Group’s related parties include the parent company,
subsidiaries, and associates. Related parties also include
the Group management consisting of the members of
the Board of Directors and the Group’s Executive Group,
as well as the board members of the subsidiaries.
Transactions between management and the company are
typical transactions between the bank and the client. The
company’s liabilities to management include the manage-
ment’s cash assets in their bank accounts in Evli. Similarly,
receivables relate to potential market-priced loans mana-
gement has drawn. There are no other exceptional loan
arrangements compared to other Evli’s clients.
Country Ownership, %
Share of voting
rights, %
Minority share
Evli Corporate Finance AB Sweden 40.5 40.5
Terra Nova Capital Advisors Ltd United Arab Emirates 10 10
Evli Research Partners Oy Finland 30 30
Evli Investment Solutions Oy Finland 15 15
EAI Residential Partners Oy Finland 25 25
Evli Private Equity Partners Oy Finland 20 20
Evli HC I GP Oy Finland 18 18
EGP General Partner Oy Finland 30 30
Evli Infrastructure Partners Oy Finland 18 18
Evli Alexander Incentives Oy Finland 35 35
Associated companies
Northern Horizon Capital A/S Denmark 50 45
Evli Bank Plc holds 50 percent of the share capital of Northern Horizon Capital A/S, which confers 45 percent
of the votes in the company as agreed upon in the partnership agreement. Considering that Evli Bank Plc does
not have control in the company, Northern Horizon Capital A/S is consolidated as an associated company by
using equity method of accounting.
The minority interests recognized in the consolidated financial statements are generated from Evli Corporate
Finance AB, Terra Nova Capital Advisors Ltd, Evli Research Partners Oy, Evli Investment Solutions Oy, EAI
Residential Partners Oy, Evli Private Equity Partners Oy, Evli HC I GP Oy, EGP General Partner Oy, Evli
Infrastructure Partners Oy and Evli Alexander Incentives Oy.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 106 | 149
FINANCIAL REVIEW
Financial success in companies with non-controlling owners
Company
Evli
Corporate
Finance AB
Terra Nova
Capital Advisors
Ltd
Evli Research
Partners Oy
Evli
Investment
Solutions Oy
EAI
Residential
Partners Oy
Evli
Private Equity
Partners Oy
Evli
HC I GP Oy
EGP General
Partner Oy
Evli
Infrastructure
Partners Oy
Evli Alexander
Incentives Oy
Domicile Sweden
United Arab
Emirates Finland Finland Finland Finland Finland Finland Finland Finland
Assets 1.6 1.2 0.5 1.5 0.5 1.1 0.5 0.9 0.2 7.8
Liabilities 1.7 0.2 0.2 0.0 0.1 0.3 0.4 0.3 0.1 1.5
Profit/Loss for the financial year -0.2 1.0 0.2 1.4 0.3 0.7 0.0 0.6 -0.1 1.8
Attributable to non-controlling interest -0.1 0.1 0.0 0.2 0.1 0.1 0.0 0.2 0.0 0.7
Dividends paid to non-controlling interest 0.5 0.0 0.1 0.2 0.1 0.0 0.0 0.2 0.0 0.1
Cash flow from operating activities -1.5 -0.2 -0.3 -0.5 -0.3 -0.5 0.0 -0.6 0.0 -2.7
Cash flow from investing activities 0.0 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 5.1
Cash flow from financing activities 0.0 0.0 0.0 0.0 0.0 0.5 0.0 0.0 0.0 -4.6
Change in cash and cash equivalents -1.0 0.0 -0.1 0.6 0.0 0.2 0.0 0.1 0.0 -1.1
Management judgment
An impairment is recognized in an associate’s value if the company’s financial position has deteriorated sub-
stantially or if the company’s future outlook is deemed to contain substantial risk factors that, if realized, would
weaken the associated company’s financial position. The valuation is calculated using theoretical methods, and
the impairment is reported in the income statement under “share of associated companies’ profit”.
8.2. SHARES AND PARTICIPATIONS IN ASSOCIATES AND JOINT VENTURES
Shares and participations in associates and joint ventures 2020 2019
At the beginning of the period 3.8 5.1
Share of profit/loss 0.0 -0.5
Additions 0.3 0.0
Disposals 0.0 -0.9
At the end of the period 4.2 3.8
Holdings in consolidated associated companies
Company name Northern Horizon Capital A/S
Domicile Denmark
Assets 8.3
Liabilities 1.0
Revenue 6.2
Profit/Loss 0.4
Profit adjustment -0.2
Evli's share of profit/loss 0.0
Ownership (%) 50.0
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 107 | 149
FINANCIAL REVIEW
8.3. CHANGES IN CORPORATE STRUCTURE
In June, Evli sold three percent of its shares in Evli Corporate Finance Ab to its employees. Following the
transaction, Evli’s ownership in the company is 56.5 percent.
In August, Evli bought 35 percent of Terra Nova Capital Advisors Ltd shares from the company’s employees.
Following the transaction, Evli’s ownership in the company is 90 percent.
In September, Evli Bank Plc and the owners of Alexander Incentives Oy signed an agreement on the exchange of
shares between Evli Awards Management Oy (“EAM”) and Alexander Incentives Oy, in which EAM gained 100
percent of the shares of Alexander Incentives Oy. As a consideration, EAM issued new own shares so that the
minority interest in the company’s shares rose to 35 percent. Evli Bank’s holding in the company is 65 percent.
PURCHASE PRICE OF ALEXANDER INCENTIVES OY
Apport payment 4.6
Total purchase price 4.6
ALLOCATION OF THE PURHASE PRICE
Total identified balance sheet items 0.3
Goodwill 4.3
Allocation total 4.6
8.4. RELATED PARTY TRANSACTIONS
Transactions with related parties 2020 Subsidiaries
Associated
companies
Group
management
Sales 25.0 0.0 0.0
Purchases 2.8 0.0 0.0
Receivables 4.3 0.0 0.5
Liabilities 23.9 0.0 0.1
Shares owned by related parties: 14.246.829 pcs
Transactions with related parties 2019
Sales 24.7 0.0 0.0
Purchases 2.2 0.0 0.0
Receivables 10.7 0.0 0.5
Liabilities 26.7 0.0 0.4
Shares owned by related parties: 14.057.857 pcs
Fees payd to auditors 2020 2019
Audit - Group
PricewaterhouseCoopers 0.2 0.2
Other companies 0.0 0.0
Audit - Parent Company
PricewaterhouseCoopers 0.1 0.1
Other companies 0.0 0.0
Total 0.3 0.3
Other than auditing fees
Other services - Group
PricewaterhouseCoopers* 0.1 0.2
Other companies 0.0 0.0
Other services - Parent company
PricewaterhouseCoopers 0.0 0.0
Other companies 0.0 0.0
Total 0.1 0.2
*The advisory services provided by PricewaterhouseCoopers Oy to Evli Group for the financial year 2020
comprise EUR 55,840.50.
8.5. FEES PAID TO AUDITORS
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 108 | 149
FINANCIAL REVIEW
Parent company’s income statement
Note 2020 2019
Interest income 9.1. 2.9 3.6
Interest expenses 9.2. -2.6 -3.2
NET INTEREST INCOME 0.3 0.4
Income from equity investments 9.3. 10.2 10.7
Fee and commission income 9.4. 38.8 37.1
Fee and commission expenses 9.5. -5.5 -4.2
Net income from securities transactions 9.6. 2.5 3.2
Other operating income 9.7. 3.5 4.5
NET REVENUE 49.7 51.7
Operating expenses
Personnel expenses 9.8. -16.1 -18.5
Other administrative expenses 9.9. -8.9 -9.7
Depreciation and amortization on tangible and intangible assets 9.10. -3.2 -3.1
Other operating expenses 9.11. -3.0 -3.0
Excpected credit losses on loans and other receivables 9.12. -0.1 -0.1
Impairment losses on other nancial assets 9.12. 0.0 0.0
OPERATING PROFIT/LOSS 18.4 17.2
PROFIT BEFORE INCOME TAX 18.4 17.2
Income taxes 9.13. -2.0 -1.4
PROFIT / LOSS FOR THE FINANCIAL YEAR 16.5 15.9
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 109 | 149
FINANCIAL REVIEW
Parent company’s balance sheet
Note 31.12.2020 31.12.2019
LIABILITIES AND EQUITY
LIABILITIES
Liabilities to credit institutions and central banks 9.26. 0.7 1.9
Liabilities to the public and public sector entities 9.27. 407.6 577.0
Debt securities issued to the public 9.28. 131.1 148.6
Derivative contracts and other liabilities held for trading 9.29. 52.5 59.7
Other liabilities 9.30. 73.4 52.4
Accrued expenses and deferred income 9.31. 9.0 8.5
Deferred tax liabilities 9.32. 0.0 0.0
TOTAL LIABILITIES 674.2 848.1
EQUITY 9.33.
Share capital 30.2 30.2
Share premium fund 1.8 1.8
Fund of invested non-restricted equity 23.3 24.8
Retained earnings 4.6 4.3
Prot/loss for nancial year 16.5 15.9
TOTAL EQUITY 76.4 77.0
TOTAL LIABILITIES AND EQUITY 750.5 925.0
Note 31.12.2020 31.12.2019
ASSETS
Cash and equivalents 9.14. 331.6 305.7
Debt securities eligible for renancing with central banks 9.17. 37.2 36.1
Claims on credit institutions 9.15. 61.2 66.2
Claims on the public and public sector entities 9.16. 110.7 115.1
Debt securities 9.17. 9.8 227.6
Shares and participations 9.18./9.19. 79.9 56.9
Derivative contracts 9.20. 52.2 59.6
Intangible assets and goodwill 9.21. 6.9 9.8
Property, plant and equipment 9.22. 1.0 1.0
Other assets 9.23. 59.1 45.6
Accrued income and prepayments 9.24. 1.3 1.2
Deferred tax assets 9.25. 0.0 0.2
TOTAL ASSETS 750.5 925.0
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 110 | 149
FINANCIAL REVIEW
2020 2019
Operating activities
Operating prot 18.4 17.2
Adjustment for items not included in cash ow 3.1 4.9
Income taxes paid -1.3 -1.4
Cash ow from operating activities before changes in operating assets and liabilities 20.2 20.7
Changes in operating asset 187.5 -5.9
Changes in operating liablities -168.5 63.5
Cash ow from operating activities 39.2 78.3
Investing activities
Change in intangible asset -0.1 -2.4
Change in property, plant and equipment -0.2 -0.1
Cash ow from investing activities -0.3 -2.6
Financing activities
Dividends paid -15.5 -14.4
Used option rights 1.5 0.4
Cash ow from nancing activities -14.1 -14.0
Cash and cash equivalents at the beginning of period 307.8 246.0
Cash and cash equivalents at the end of year 332.6 307.8
Change 24.8 61.7
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 111 | 149
FINANCIAL REVIEW
Parent Company´s accounting policies
Basic information on the company
Evli Bank Plc is domiciled in Helsinki and its registered
address is Aleksanterinkatu 19 A, 00100 Helsinki.
Evli Bank Plc’s nancial statements are prepared and
presented in accordance with the regulations of the
Act on Credit Institutions, the Ministry of Finance deci-
sion regarding credit institutions’ and investment ser-
vices providers’ nancial statements and the Financial
Supervisory Authority’s regulations. The Accounting
Act and the regulations on nancial statements of the
Limited Liability Companies Act are complied with,
with the exceptions stated in Section 30(2) of the Act
on Credit Institutions.
Evli Bank Plc’s notes to the separate nancial state-
ments correspond to the Evli Group’s principles,
except for the exceptions listed below.
Employee benets
Evli nances all its retirement plans as payments to
employee pension companies.
Income taxes
Deferred tax is generally calculated on all temporary
differences between the carrying amount of an asset
or liability in the balance sheet and its tax base. The
largest temporary differences arise from the depreci-
ation of xed assets.
Leases
Leases of property, plant and equipment in which the
company bears a substantial portion of the risks and
rewards of ownership are classied as nance leases.
In the parent company nancial statements, the pay-
ment made on the basis of such leases are treated as
rental expenses. The assets acquired through nance
leases are also not recognized in the balance sheet.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 112 | 149
FINANCIAL REVIEW
9.1. INTEREST INCOME 2020 2019
At fair value through prot or loss
Debt securities 0.4 0.6
Interest income from other loans and claims
Claims on credit institutions 0.1 0.2
Claims on the public and public sector entities 1.6 1.6
Other interest income 0.9 1.2
Interest income, total 2.9 3.6
9.2. INTEREST EXPENSES 2020 2019
At fair value through prot or loss
Interest expenses from other borrowing
Liabilities to the public, public sector entities and credit institutions -2.1 -2.0
Debt securities issued to the public -0.4 -0.5
Other interest expenses -0.1 -0.7
Interest expenses, total -2.6 -3.2
9.3. INCOME FROM EQUITY INVESTMENTS 2020 2019
Dividends from associated companies 0.0 0.8
Dividends from group companies 10.2 9.9
Income from equity investments, total 10.2 10.7
9.4. COMMISSION INCOME 2020 2019
Credit related fees and commissions 0.0 0.1
Advisory services 1.0 1.4
Securities brokerage 9.2 9.6
Securities issue 0.0 0.0
Mutual funds 17.8 15.5
Asset management 5.1 5.3
Custody services 3.9 5.0
Other operations 1.7 0.1
Commission income, total 38.8 37.1
9.5. COMMISSION EXPENSES 2020 2019
Trading fees paid to stock exchanges -1.8 -0.9
Other -3.7 -3.2
Commission expenses, total -5.5 -4.2
9.6. NET INCOME FROM SECURITIES TRANSACTIONS
AND FOREIGN EXCHANGE DEALING 2020 2019
Net income from securities transactions
Financial assets held for trading -0.2 0.0
Financial assets at fair value through prot or loss 0.6 2.1
Net income from securities transactions, total 0.4 2.1
Gains
and losses
on sales
Changes in
fair value Total Total
Net income from securities
transactions by instrument
Debt securities -0.2 -0.6 -0.9 -0.5
Shares and derivative contracts 0.2 1.1 1.3 2.6
Net income from securities
transactions, total -0.1 0.5 0.4 2.1
Net income from foreign
exchange operations 2.0 1.1
Net income from securities transactions
and foreign exchange operations, total 2.5 3.2
9.7. OTHER OPERATING INCOME 2020 2019
Other income 3.5 4.5
Other operating income, total 3.5 4.5
Parent company’s notes to income statement
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 113 | 149
FINANCIAL REVIEW
9.8. EMPLOYEE BENEFITS 2020 2019
Wages and salaries -13.8 -15.6
of which bonuses -2.7 -3.1
Other social security costs -0.4 -0.5
of which relating to bonuses 0.0 -0.1
Pension expenses -1.8 -2.4
of which relating to bonuses -0.2 -0.3
dened contribution plans -1.8 -2.4
Employee benets, total -16.1 -18.5
2020 2019
Number of personnel during the period, average 146 158
Number of personnel at the end of the period 147 150
Employees by business segment at the end of the period
Advisory and Corporate Clients 5 6
Wealth Management and Investor Clients 95 93
Group Operations 47 51
Total 147 150
9.9. OTHER OPERATING EXPENSES 2020 2019
Ofce expenses -1.1 -1.0
IT and infosystems -5.5 -4.9
Business expenses -0.2 -0.6
Travel expenses -0.1 -0.2
Other HR related expenses -0.3 -0.7
Marketing expenses -0.5 -0.5
Banking and custodian expenses -0.6 -1.1
External services -0.5 -0.7
Other operating expenses total -8.8 -9.7
9.10. DEPRECIATION, AMORTIZATION AND IMPAIRMENT LOSSES 2020 2019
Depreciation and amortization
From goodwill -0.2 -0.2
Applications and software -2.0 -1.7
Other intangible assets -0.8 -1.0
Equipment and furniture -0.2 -0.2
Depreciation, amortization and impaiment losses, total -3.2 -2.9
9.11. OTHER OPERATING EXPENSES 2020 2019
Supervision expenses -0.4 -0.5
Rental expenses -2.1 -2.2
Other expenses -0.6 -0.4
Other operating expenses total -3.0 -3.0
9.12. EXPECTED CREDIT LOSSES ON LOANS AND OTHER COMMIT-
MENTS AND IMPAIRMENT LOSSES ON OTHER FINANCIAL ASSETS 2020 2019
Claims on the public and public sector entities
Expected credit losses on group level -0.1 0.0
Expected credit losses individual 0.0 -0.1
Realised loan losses -0.1 0.0
Impairment losses, total -0.1 -0.1
9.13. INCOME TAXES 2020 2019
Current tax expense -1.7 -1.4
Taxes from previous years -0.3 0.0
Income taxes, total -2.0 -1.4
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 114 | 149
FINANCIAL REVIEW
Parent company’s notes to balance sheet
9.14. CASH AND EQUIVALENTS 2020 2019
Balances with central banks 331.5 305.5
Other 0.1 0.2
Cash and cash equivalents total 331.6 305.7
9.15. CLAIMS ON CREDIT INSTITUTIONS 2020 2019
Repayable on demand
Domestic credit institutions 1.1 2.0
Foreign credit institutions 0.0 0.1
Repayable on demand, total 1.1 2.1
Other than repayable on demand
Domestic credit institutions 24.0 19.4
Foreign credit institutions 36.1 44.7
Other than repayable on demand, total 60.1 64.1
Claims on credit institutions, total 61.2 66.2
9.16. CLAIMS ON THE PUBLIC AND PUBLIC SECTOR
ENTITIES BY SECTOR 2020 2019
Repayable on demand
Financial and insurance corporations 0.0 0.4
Repayable on demand, total 0.0 0.4
Other than repayable on demand
Enterprises and housing associations 27.0 25.0
Financial and insurance corporations 0.9 0.7
Households 71.8 74.5
Foreign countries 11.1 14.4
Other than repayable on demand, total 110.7 114.7
Claims on the public and public sector entities by sector, total 110.7 115.1
2020 2019
9.17. DEBT SECURITIES
Publicly
quoted Other Total Total
Issued by public corporations
Local government notes 0,0 8,0 8,0 220.0
Issued by other than public
corporations 0,0 8,0 8,0 220.0
Issued by other than public corporations
Bonds issued by banks 37,2 0,4 37,5 37.5
Other debt securities 0,0 1,4 1,4 6.1
Issued by other than public
corporations 37,2 1,8 38,9 43.7
Debt securities, total 46,9 263.7
Debt securities by balance sheet category
Debt securities eligible for renancing with central banks
Other 37,2 36.1
Debt securities
On public sector entities 8,0 220.0
Other 1,8 7.6
Total 46,9 263.7
Debt securities by country
Finland 30,6 247,2
Sweden 11,0 15,0
France 0,0 1,4
Denmark 5,3 0,0
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 115 | 149
FINANCIAL REVIEW
9.18. SHARES AND PARTICIPATIONS
Fair valued through prot or loss
2020
Balance sheet category
Publicly
quoted Other Total
Shares and participations
Valued at fair value through prot or loss
Held for trading 0.1 0.0 0.1
Other 49.9 7.2 57.0
Shares and participations, total 50.0 7.2 57.1
2019
Balance sheet category
Publicly
quoted Other Total
Shares and participations
Valued at fair value through prot or loss
Held for trading 0.0 0.0 0.0
Other 24.9 6.5 31.4
Shares and participations, total 24.9 6.5 31.4
Net risk position is described in section Market Risk, Notes on Risk Position.
9.19. SHARES AND PARTICIPATION IN ASSOCIATES
AND JOINT VENTURES 2020 2019
At the beginning of the period 4.4 4.4
Additions/Disposals 0.0 0.0
At the end of the period 4.4 4.4
Shares and participations in companies
belonging to Group
At the beginning of the period 21.2 21.2
Additions/Impairments -2.7 0.0
At the end of the period 18.5 21.2
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 116 | 149
FINANCIAL REVIEW
9.20. DERIVATIVE CONTRACTS
Overall effect of risks associated with derivative contracts 2020 2020
Nominal value of underlying , gross Remaining maturity
Held for trading
Less than 1
year
1-5
years
5-15
years
Fair value
(+/-) ASSETS LIABILITIES
Interest rate derivatives
Interest rate swaps 2.1 100.7 2.2 0.0 1.0 1.0
Equity-linked derivatives
Futures 0.7 3.4 0.0 0.0 0.0 0.0
Options bought 0.0 0.0 0.0 0.0 0.0 0.0
Options sold 0.0 0.0 0.0 0.0 0.0 0.0
Currency-linked derivatives 4 555.2 32.1 0.0 0.1 51.1 51.0
Held for trading, total 4 558.0 136.1 2.2 0.1 52.2 52.0
Derivative contracts, total 4 558.0 136.1 2.2 0.1 52.2 52.0
Overall effect of risks associated with derivative contracts 2019 2019
Held for trading
Interest rate derivatives
Interest rate swaps 2.4 82.1 18.9 0.0 4.4 4.4
Equity-linked derivatives
Futures 3.4 4.1 0.0 0.0 0.2 0.2
Options bought 3.7 0.0 0.0 0.3 0.3 0.0
Options sold 3.7 0.0 0.0 -0.3 0.0 0.3
Currency-linked derivatives 5,745.5 11.4 0.0 -0.1 54.7 54.8
Held for trading, total 5,758.7 97.7 18.9 -0.1 59.6 59.7
Derivative contracts, total 5,758.7 97.7 18.9 -0.1 59.6 59.7
Equity derivatives in the banking book hedge the
equity risk in equity-linked bonds issued to the
public.
The interest rate derivatives hedge the interest rate
risk in liabilities in the balance sheet.
Currency derivatives comprise commitments made
against clients and the associated hedges, and
contracts made to hedge currency risk in the balance
sheet. The net open risk position of the total amount
is small. The largest part of the contracts are in SEK
(3,569 M€), and in USD (475 M€)
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 117 | 149
FINANCIAL REVIEW
9.21. INTANGIBLE ASSETS AND GOODWILL 2020 2019
Goodwill
Cost at 1.1. 1.2 1.2
Increases/Decreases 0.0 0.0
Cost at 31.12. 1.2 1.2
Accumulated depreciation at 1.1. -0.3 0.0
Impairment losses for the period 0.0 -0.3
Accumulated depreciation at 31.12. -0.5 -0.3
Book value at 31.12. 0.6 0.9
Software or projects in progress
Cost at 1.1. 0.1 2.0
Increases/Decreases -0.1 -1.9
Cost at 31.12. 0.0 0.1
Book value at 31.12. 0.0 0.1
Applications and software
Cost at 1.1. 21.1 16.7
Increases/Decreases 0.2 4.4
Cost at 31.12. 21.3 21.1
Accumulated amortisation and impairment losses at 1.1. -13.7 -12.0
Amortisation for the period -2.0 -1.7
Accumulated amortisation and impairment losses at 31.12. -15.7 -13.7
Book value at 31.12. 5.6 7.4
Leasehold improvements FAS
Cost at 1.1. 1.4 1.4
Cost at 31.12. 1.4 1.4
Accumulated amortisation and impairment losses at 1.1. -1.1 -1.0
Amortisation for the period -0.1 -0.1
Accumulated amortisation and impairment losses at 31.12. -1.3 -1.1
Book value at 31.12. 0.1
0.3
9.22. PROPERTY, PLANT AND EQUIPMENT 2020 2019
Equipment and furniture
Cost at 1.1. 1.3 1.2
Increases/Decreases 0.2 0.1
Cost at 31.12. 1.5 1.3
Accumulated amortisation and impairment losses at 1.1. -1.0 -0.8
Amortisation for the period 0.0 -0.2
Accumulated amortisation in respect of decreases -0.2 0.0
Accumulated amortisation and impairment losses at 31.12. -1.2 -1.0
Book value at 31.12. 0.4 0.4
Property, plant, and equipment, total 31.12. 0.4 0.4
Other tangible assets
Cost at 1.1. 0.6 0.6
Cost at 31.12. 0.6 0.6
Book value at 31.12. 0.6 0.6
Property, plant and equipment, total at 31.12. 1.0 1.0
Book value of tangible assets at 31.12. 1.0 1.0
2020 2019
Other intangible assets
Cost at 1.1. 2.3 2.3
Cost at 31.12. 2.3 2.3
Accumulated amortisation and impairment losses at 1.1. -1.2 -0.3
Amortisation for the period -0.7 -0.9
Accumulated amortisation and impairment losses at 31.12. -1.9 1.1
Book value at 31.12. 0.4 1.1
Intangible assets, total at 31.12. 6.9 9.8
Book value of intangible assets at 31.12. 6.9 9.8
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 118 | 149
FINANCIAL REVIEW
9.23. OTHER ASSETS 2020 2019
Securities sale receivables 0.2 2.1
Commission receivables 2.0 1.8
Securities broking receivables 52.9 26.1
Other receivables 3.9 15.6
Other assets total 59.1 45.6
9.24. ACCRUED INCOME AND PREPAYMENTS 2020 2019
Interest 0.4 0.4
Staff-related 0.0 0.1
Other items 0.8 0.8
Accrued income and prepayments total 1.3 1.2
9.25. DEFERRED TAX ASSETS 2020 2019
Due to timing differences* 0.0 0.1
Deferred taxes total 0.0 0.2
*Deferred tax assets result from timing differences in xed asset depreciation.
9.26. LIABILITIES TO CREDIT INSTITUTIONS AND CENTRAL BANKS 2020 2019
Credit institutions
Repayable on demand 0.0 0.2
Other than repayable on demand 0.7 1.7
Liabilities to credit institutions and central banks, total 0.7 1.9
9.27. LIABILITIES TO THE PUBLIC AND PUBLIC SECTOR ENTITIES 2020 2019
Deposits
Repayable on demand 407,5 576.9
Other than repayable on demand 0,1 0.1
Liabilities to the public and public sector entities, total 407.6 577.0
9.28. DEBT SECURITIES ISSUED TO THE PUBLIC 2020 2019
Certicate of deposits 10.0 25.0
Bonds 121.1 123.6
Debt securities issued to the public, total 131.1 148.6
Changes in bonds issued to the public
Issues 31.7 49.5
Repurchases 34.4 44.3
9.29. DERIVATIVE CONTRACTS AND OTHER LIABILITIES
HELD FOR TRADING 2020 2019
Derivative contracts 52.0 59.7
Due to short selling of shares 0.4 0.0
Derivative contracts and other liabilities held for trading, total 52.5 59.7
9.30. OTHER LIABILITIES 2020 2019
Securities broking liabilities 54.7 32.3
Securities purchase liabilities 0.0 15.0
Income tax payable 0.0 0.1
Personnel related 0.4 0.4
Other short-term liabilities 3.9 3.4
Prepayments of cash customers 14.0 0.9
VAT payable 0.4 0.3
Other liabilities, total 73.4 52.4
9.31. ACCRUED EXPENSES AND DEFERRED INCOME 2020 2019
Interest 0.1 0.3
Tax payables 0.7 1.0
Personnel related 6.9 6.2
Other accrued expenses 1.3 1.0
Accrued expenses and deferred income, total 8.9 8.5
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 119 | 149
FINANCIAL REVIEW
9.32. EQUITY CAPITAL 2020 2019
Share capital
Book value 1.1. 30.2 30.2
Book value 31.12. 30.2 30.2
Share premium
Book value 1.1. 1.8 1.8
Book value 31.12. 1.8 1.8
Fund of invested non-restricted equity
Book value 1.1. 24.8 24.4
Increases/Decreases -1.5 0.4
Book value 31.12. 23.3 24.8
Retained earnings from previous years
Retained earnings 1.1. 20.1 18.6
Dividends -15.5 -14.4
Translation difference and other changes in retained earnings 0.0 0.0
Retained earnings 31.12. 4.6 4.2
Prot for the period 16.5 15.9
Own shares held by the credit institution
The company has not acquired own shares during 2020. On December 31, 2020 the company held a total of
328,998 own shares.
Share capital, parent company
Evli has two share series: series A and series B.
The A share confers 20 votes in a General Meeting while a B share confers one vote.
Number of shares-A-shares 14,635,264 shares
Number of shares-B-shares 9,474,156 shares
Total number of shares is 24,109,420 shares
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 120 | 149
FINANCIAL REVIEW
9.33. MATURITIES OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES OF CREDIT INSTITUTION
Debt securities, loans and other claims, derivatives and nancial liabilities at amortized cost are reported in the maturity class according to the maturity of the instrument. Shares and participations are reported so that quoted
shares in the trading book and quoted mutual funds are in the shortest maturity period. Unquoted shares are reported according to the estimated liquidation period, and venture capital- and real estate funds are reported
according to the expected ending day of the fund.
2020 2019
Less than 3
months
3-12
months
1-5
years
5-10
years
over 10
years Total
Less than 3
months
3-12
months
1-5
years
5-10
years
over 10
years Total
Assets
Cash and cash equivalents 331.6 0.0 0.0 0.0 0.0 331.6 305.7 0.0 0.0 0.0 0.0 305.7
Financial assets at amortized cost
Claims on credit institutions 61.2 0.0 0.0 0.0 0.0 61.2 66.2 0.0 0.0 0.0 0.0 66.2
Claims on the public
and public sector entities 4.9 23.9 81.2 0.7 0.0 110.7 8.7 27.9 72.4 6.1 0.0 115.1
Financial assets at fair value
through prot or loss
Debt securities eligible for
renancing with central banks 0.0 15.7 21.5 0.0 0.0 37.2 13.0 18.0 5.0 0.0 0.0 36.1
Debt securities 8.3 0.0 1.1 0.4 0.0 9.8 206.2 17.5 1.1 0.0 2.9 227.6
Shares and participations 50.5 0.8 3.3 2.4 0.1 57.1 24.9 1.6 2.7 2.1 0.1 31.4
Derivative contracts 51.1 0.0 1.0 0.0 0.0 52.2 54.5 0.5 3.8 0.8 0.0 59.6
Accrued interest 0.3 0.1 0.0 0.0 0.0 0.4 0.2 0.1 0.0 0.0 0.0 0.4
Liabilities
Financial liabilities at amortized cost
Liabilities to credit institutions 0.7 0.0 0.0 0.0 0.0 0.7 1.4 0.5 0.0 0.0 0.0 1.9
Liabilities to the public
and public sector entities 407.5 0.1 0.0 0.0 0.0 407.6 576.9 0.1 0.0 0.0 0.0 577.0
Debt securities issued to the public 1.0 11.8 116.0 2.2 0.0 131.1 12.2 22.8 94.7 18.9 0.0 148.6
Financial liabilities at fair value
through prot or loss 51.4 0.0 1.0 0.0 0.0 52.5 55.4 0.5 3.8 0.0 0.0 59.7
Accrued interest, debt 0.1 0.0 0.0 0.0 0.0 0.1 0.3 0.0 0.0 0.0 0.0 0.3
Off-balance sheet commitments 5.4 3.3 6.3 0.0 0.0 15.1 8.6 2.2 1.8 0.4 0.0 13.1
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 121 | 149
FINANCIAL REVIEW
9.34. ASSETS AND LIABILITIES DENOMINATED IN DOMESTIC AND FOREIGN CURRENCY
Assets
Domestic
currency
Foreign
currency
2020
Total
Domestic
currency
Foreign
currency
2019
Total
Financial assets at amortized cost
Cash and cash equivalents 331.6 0.0 331.6 305.7 0.0 305.7
Claims on credit institutions 56.9 4.2 61.2 61.9 4.3 66.2
Claims on the public and public sector entities 109.6 1.2 110.7 114.0 1.1 115.1
Financial assets at fair value through prot or loss
Debt securities eligible for renancing with central banks 0.0 0.0 0.0 36.1 0.0 36.1
Debt securities 46.6 0.4 46.9 226.2 1.4 227.6
Shares and participations 56.9 0.2 57.1 31.0 0.4 31.4
Derivative contracts 51.9 0.2 52.2 57.8 1.8 59.6
Other asset items 69.9 21.0 90.9 71.3 12.0 83.3
Total 723.4 27.1 750.5 904.1 21.0 925.0
Liabilities
Financial liabilities at amortized cost
Liabilities to credit institutions 0.7 0.0 0.7 1.9 0.0 1.9
Liabilities to the public and public sector entities 388.4 19.2 407.6 512.3 64.7 577.0
Debt securities issued to the public 131.1 0.0 131.1 148.6 0.0 148.6
Financial liabilities at fair value through prot or loss 51.8 0.7 52.5 57.9 1.8 59.7
Other liabilities items 60.8 21.5 82.4 47.6 13.3 60.9
Total 632.7 41.4 674.2 768.2 79.8 848.1
The largest foreign currency assets and liabilities are in SEK (assets 20.2 M€, liabilities 28.0 M€) and USD (assets 3.7 M€, liabilities 7.0 M€). Derivatives positions which hedge
the foreign exchange risk are not included in these gures.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 122 | 149
FINANCIAL REVIEW
9.35. SECURITIES LENDING 2020 2019
Market value of securities lending at 31.12.,
lent in 2.8 0.0
Market value of securities lending at 31.12.,
lent out 0.0 0.0
9.36. FAIR VALUES AND BOOK VALUES
OF FINANCIAL ASSETS AND FINANCIAL
LIABILITIES
Book value Fair value
2020 2020
Financial assets
Cash and equivalents 331.6 331.6
Debt securities eligible for renancing with
central banks 37.2 37.2
Claims on credit institutions 61.2 61.2
Claims on the public and public sector entities 110.7 110.7
Debt securities 9.8 9.8
Shares and participations 57.1 57.1
Derivative contracts 52.2 52.2
Financial liabilities
Liabilities to credit institutions and central banks 0.7 0.7
Liabilities to the public and public sector entities 407.6 407.6
Debt securities issued to the public 131.1 129.8
Derivative contracts and other liabilities
held for trading 52.5 52.5
9.37. ASSETS PLEDGED AS COLLATERAL
Fair value of
encumbered assets
Fair value of
unencumbered assets
of which usable
as collateral
ASSETS 2020 2020 2020
Cash and cash equivalents 0.0 331.6 326.7
Debt securities eligible for renancing with central banks 33.8 3.4 3.4
Claims on credit institutions 60.1 1.1 1.1
Claims on the public and public sector entities 0.0 110.7 0.0
Debt securities 0.0 9.8 0.0
Shares and participations 0.0 57.1 0.0
93.9 513.6 331.1
Usage of collateral
Markeplace collateral, stock- and derivatives trades 10.0
Collateral for OTC derivatives trades 47.3
Collateral for securities lending 2.8
Bank Of Finland, collateral for daily limit account 33.8
93.9
Received collateral
Fair value of
collateral recieved
LIABILITIES
Received cash 53.3
ASSETS 2019 2019 2019
Cash and cash equivalents 0.0 305.7 299.0
Debt securities eligible for renancing with central banks 34.1 2.0 2.0
Claims on credit institutions 64.1 2.1 2.1
Claims on the public and public sector entities 0.0 115.1 0.0
Debt securities 0.0 227.6 0.0
Shares and participations 0.0 31.4 0.0
98.2 683.9 303.1
Usage of collateral
Markeplace collateral, stock- and derivatives trades 12.0
Collateral for OTC derivatives trades 52.1
Collateral for securities lending
Bank Of Finland, collateral for daily limit account 34.1
98.2
Received collateral
Fair value of
collateral recieved
LIABILITIES
Received cash 65.4
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 123 | 149
FINANCIAL REVIEW
9.38. OTHER RENTAL COMMITMENTS 2020 2019
Rental liabilities up to one year 2.2 2.2
Rental liabilities over one year and less than 5 years 6.0 2.7
Rental liabilities over 5 years 1.4 0.0
Leasing liabilities not later than one year 0.1 0.0
Leasing liabilities over year not later than ve year 0.3 0.0
9.39. BREAKDOWN OF OFF-BALANCE SHEET COMMITMENTS 2020 2019
Commitments given to a third party on behalf of a customer* 5.4 6.9
Irrevocable commitments given in favour of a customer 2.3 0.3
Guarantees on behalf of others 0.0 0.5
Unused credit facilities, given to clients 9.6 5.4
*Commitments given on behalf of a client for a third party include collaterals for derivatives positions given on
behalf of clients. The clients have covered their derivatives collateral to Evli in full. Other irrevocable
commitments given on behalf of a client comprise subscription commitments guaranteed on behalf of clients.
MANDATORY ELEMENTS OF THE ESEF TAXONOMY
Name of reporting entity or other means of identication
Domicile of entity
Legal form of entity
Country of incorporation
Address of entity's registered ofce
Principal place of business
Description of nature of entity's operations
and principal activities
Name of parent entity
Name of ultimate parent of group
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 124 | 149
FINANCIAL REVIEW
The Board of Directors’ proposal to the General Meeting
Henrik Andersin Robert Ingman Fredrik Hacklin Sari Helander
Mikael Lilius Teuvo Salminen Maunu Lehtimäki
Chairman
CEO
Authorised Public Accountant (KHT)
The parent company’s distributable assets on December 31, 2020 totaled EUR 44,341,920.73 of which EUR 21,056,874.74
were retained earnings and EUR 23,285,045.99 were in the reserve for invested unrestricted equity. The Board of Directors
proposes to the Annual General Meeting of Shareholders that a dividend of a maximum of EUR 0.73 per share be paid.
The total proposed dividend calculated according to the number of shares (excluding own shares held by the company) on
the balance sheet date is EUR 17,359,708.06. It is proposed that the Annual General Meeting would authorize the Board of
Directors to decide on the payment of the dividend in one or more instalments at a time it deems best, taking into account
the current authority recommendations.
There have been no major changes in the company’s nancial position after the end of the nancial year. The proposed
distribution of prot does not endanger the nancial solidity or liquidity of the company.
Helsinki, February 8, 2021
Auditor´s Note
Based on the auditing an audit report has been issued today.
Helsinki, February 8, 2021
PricewaterhouseCoopers Oy
Authorised Public Accountants
Jukka Paunonen
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 125 | 149
FINANCIAL REVIEW
Auditor’s Report
(Translation of the Finnish Original)
To the Annual General Meeting of Evli Bank Plc
Report on the Audit of the Financial
Statements
Opinion
In our opinion
• the consolidated nancial statements give
a true and fair view of the group’s nancial
position and financial performance and
cash ows in accordance with International
Financial Reporting Standards (IFRS) as
adopted by the EU
• the financial statements give a true and
fair view of the parent company’s finan-
cial performance and nancial position in
accordance with the laws and regulations
governing the preparation of the nancial
statements in Finland and comply with stat-
utory requirements.
Our opinion is consistent with the additional
report to the Audit Committee.
What we have audited
We have audited the nancial statements of
Evli Bank Plc (business identity code 0533755-
0) for the nancial year January 1 to December
31, 2020. The nancial statements comprise:
• the consolidated comprehensive income
statement, consolidated balance sheet,
consolidated statement of cash ow, con-
solidated statement of changes in equity
and notes to the financial statements,
including a summary of signicant accoun-
ting policies
• the parent company’s income statement,
parent company’s balance sheet, parent
company’s statement of cash ow and notes
to the nancial statements, including a sum-
mary of signicant accounting policies.
Basis for opinion
We conducted our audit in accordance with
good auditing practice in Finland. Our respon-
sibilities under good auditing practice are fur-
ther described in the Auditor’s Responsibilities
for the Audit of the Financial Statements sec-
tion of our report.
We believe that the audit evidence we have
obtained is sufcient and appropriate to pro-
vide a basis for our opinion.
Independence
We are independent of the parent company
and of the group companies in accordance
with the ethical requirements that are appli-
cable in Finland and are relevant to our audit,
and we have fullled our other ethical respon-
sibilities in accordance with these require-
ments.
To the best of our knowledge and belief, the
non-audit services that we have provided to
the parent company and to the group com-
panies are in accordance with the applicable
law and regulations in Finland and we have not
provided non-audit services that are prohibi-
ted under Article 5(1) of the Regulation (EU)
No 537/2014. The non-audit services that we
have provided are disclosed in note 8.5 to the
Financial Statements.
Our audit approach
Overview
As part of designing our audit, we determined
materiality and assessed the risks of material
misstatement in the financial statements. In
particular, we considered areas where mana-
gement made subjective judgements; for
example, in respect of signicant accounting
estimates that involve assumptions and evalu-
ation of future events that are inherently uncer-
tain.
Materiality
• Overall group materiality: € 3.5 million, which
represents 0.46% of the balance sheet total
Audit Scope
• In addition to the parent company, the group audit
scope included ve signicant companies
Key audit matters
• Recognition of commission income
• Valuation of nancial assets and nancial liabilities
measured at fair value
GOVERNANCE
FINANCIAL REVIEW
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ANNUAL REPORT 2020EVLI BANK PLC 126 | 149
FINANCIAL REVIEW
Materiality
The scope of our audit was inuenced by our
application of materiality. An audit is designed
to obtain reasonable assurance whether the
financial statements are free from material
misstatement. Misstatements may arise due
to fraud or error. They are considered mate-
rial if individually or in aggregate, they could
reasonably be expected to inuence the eco-
nomic decisions of users taken on the basis of
the nancial statements.
Based on our professional judgement, we
determined certain quantitative thresholds for
materiality, including the overall group materi-
ality for the consolidated nancial statements
as set out in the table below. These, together
with qualitative considerations, helped us
to determine the scope of the audit and the
nature, timing and extent of the audit proce-
dures and to evaluate the effect of misstate-
ments on the nancial statements as a whole.
How we tailored our group audit scope
We tailored the scope of our audit, taking
into account the structure of Evli Group, the
accounting processes and controls, and the
industry in which the group operates.
We determined the type of work that needed
to be performed at group companies by us,
as the group engagement team. Audits were
performed in group companies which were
considered signicant either because of their
individual nancial signicance or due to their
specic nature, covering the majority of reve-
nue, assets and liabilities of the group. Analy-
tical procedures were performed to cover the
remaining group companies.
Key audit matters
Key audit matters are those matters that, in our
professional judgment, were of most signi-
cance in our audit of the nancial statements
of the current period. These matters were
addressed in the context of our audit of the
nancial statements as a whole, and in forming
our opinion thereon, and we do not provide a
separate opinion on these matters.
As in all of our audits, we also addressed the
risk of management override of internal con-
trols, including among other matters conside-
ration of whether there was evidence of bias
that represented a risk of material misstate-
ment due to fraud.
Overall group materiality EUR 3.5 million (previous year EUR 3.5 million)
How we determined it 0.46% of the balance sheet total
Rationale for the materiality
benchmark applied
We chose the balance sheet total as a benchmark,
because in our view, it is the appropriate benchmark
to assess the group’s performance, and it is a generally
accepted benchmark. We chose 0.46%, which is within
the range of acceptable quantitative materiality thres-
holds in auditing standards.
Key audit matter in the audit
of the group
How our audit addressed
the key audit matter
Recognition of commission income
Note 1.3 in the consolidated nancial state-
ments
The assets managed by Evli Group entitle it to
fee and commission income under the agree-
ments made with customers and coope-
ration parties.
The accuracy of calculation of commission
and fee income inherently involves risk, con-
sidering that the calculation is system-based
and partly manual based on contract data
and other source data.
Commission income in the consolidated
financial statements was EUR 79.9 million
representing a signicant item in the consoli-
dated income statement.
We have determined recognition of commis-
sion and fee income as a key audit matter due
to above mentioned aspects.
We obtained an understanding of business
processes and IT systems related to commis-
sion and fee income and assessed the control
environment.
Our audit work also included a comparison of
accounting data between sub-ledger systems
and the general ledger. Furthermore, we have
performed substantive testing of commission
and fee income.
We have assessed calculation models for
recognized commission and fee income and
compared the input parameters applied in
the calculations to agreements on a sample
basis.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 127 | 149
FINANCIAL REVIEW
We have no key audit matters to report with
respect to our audit of the parent company
nancial statements.
There are no signicant risks of material mis-
statement referred to in Article 10(2c) of Regu-
lation (EU) No 537/2014 with respect to the
consolidated nancial statements or the pa-
rent company nancial statements.
Responsibilities of the Board of
Directors and the Managing Director for
the Financial Statements
The Board of Directors and the Managing
Director are responsible for the preparation of
the consolidated nancial statements that give
a true and fair view in accordance with Interna-
tional Financial Reporting Standards (IFRS) as
adopted by the EU, and of nancial statements
that give a true and fair view in accordance
with the laws and regulations governing the
preparation of nancial statements in Finland
and comply with statutory requirements. The
Board of Directors and the Managing Direc-
tor are also responsible for such internal con-
trol as they determine is necessary to enable
the preparation of nancial statements that are
free from material misstatement, whether due
to fraud or error.
In preparing the financial statements, the
Board of Directors and the Managing Director
are responsible for assessing the parent com-
pany’s and the group’s ability to continue as a
going concern, disclosing, as applicable, mat-
ters relating to going concern and using the
going concern basis of accounting. The nan-
cial statements are prepared using the going
concern basis of accounting unless there is an
intention to liquidate the parent company or
the group or to cease operations, or there is
no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit
of the Financial Statements
Our objectives are to obtain reasonable assu-
rance about whether the nancial statements
as a whole are free from material misstate-
ment, whether due to fraud or error, and to
issue an auditor’s report that includes our opin-
ion. Reasonable assurance is a high level of
assurance but is not a guarantee that an audit
conducted in accordance with good auditing
practice will always detect a material misstate-
ment when it exists. Misstatements can arise
from fraud or error and are considered material
if, individually or in the aggregate, they could
reasonably be expected to inuence the eco-
nomic decisions of users taken on the basis of
these nancial statements.
As part of an audit in accordance with good
auditing practice, we exercise professional
judgment and maintain professional skepti-
cism throughout the audit. We also:
• Identify and assess the risks of material
misstatement of the nancial statements,
whether due to fraud or error, design and
perform audit procedures responsive to
those risks, and obtain audit evidence
that is sufcient and appropriate to pro-
vide a basis for our opinion. The risk of
not detecting a material misstatement
resulting from fraud is higher than for one
resulting from error, as fraud may involve
collusion, forgery, intentional omissions,
misrepresentations, or the override of
internal control.
• Obtain an understanding of internal con-
trol relevant to the audit in order to design
audit procedures that are appropriate in
the circumstances, but not for the purpose
of expressing an opinion on the effec-
tiveness of the parent company’s or the
group’s internal control.
• Evaluate the appropriateness of accoun-
ting policies used and the reasonableness
of accounting estimates and related dis-
closures made by management.
• Conclude on the appropriateness of the
Board of Directors’ and the Managing
Director’s ’s use of the going concern basis
of accounting and based on the audit
evidence obtained, whether a material
uncertainty exists related to events or con-
ditions that may cast signicant doubt on
the parent company’s or the group’s ability
Key audit matter in the audit
of the group
How our audit addressed
the key audit matter
Valuation of nancial assets and nancial liabilities measured at fair value
Notes 2.4, 2.5, 2.6, 7.1, 7.3, 7.4, 7.5 and 7.6 in
the consolidated nancial statements
Determination of fair values is based on va-
luation principles outlined in the accounting
policies of Evli Group’s nancial statements.
A significant amount of financial assets
and liabilities valued at fair value (hereafter
referred to as “investments”) is comprised of
investments for which a quoted market price
cannot be obtained, i.e. hierarchy level 2 and
3 investments. Fair values for these are based
on valuation models that involve manage-
ment judgment.
Investments are a material line item in Evli
Group’s financial statements, and we have
therefore determined their valuation as a key
audit matter.
We have evaluated the valuation process,
valuation model and control environment
of investments and the compliance with the
accounting policies in Evli Group.
In connection with our audit, we have compa-
red input parameters applied in the valuation
model to market quotations and other exter-
nal price sources and assessed the results of
the valuation model.
We have also assessed the appropriateness
of the notes in the consolidated nancial sta-
tements regarding investments.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 128 | 149
FINANCIAL REVIEW
to continue as a going concern. If we con-
clude that a material uncertainty exists,
we are required to draw attention in our
auditor’s report to the related disclosures
in the nancial statements or, if such dis-
closures are inadequate, to modify our
opinion. Our conclusions are based on the
audit evidence obtained up to the date
of our auditor’s report. However, future
events or conditions may cause the parent
company or the group to cease to con-
tinue as a going concern.
• Evaluate the overall presentation, struc-
ture and content of the nancial state-
ments, including the disclosures, and
whether the nancial statements represent
the underlying transactions and events so
that the nancial statements give a true
and fair view.
• Obtain sufcient appropriate audit evi-
dence regarding the nancial informa-
tion of the entities or business operations
within the group to express an opinion on
the consolidated nancial statements. We
are responsible for the direction, supervi-
sion and performance of the group audit.
We remain solely responsible for our audit
opinion.
We communicate with those charged with gover-
nance regarding, among other matters, the
planned scope and timing of the audit and sig-
nicant audit ndings, including any signicant
deciencies in internal control that we identify
during our audit.
We also provide those charged with gov-
ernance with a statement that we have com-
plied with relevant ethical requirements regar-
ding independence, and to communicate with
them all relationships and other matters that
may reasonably be thought to bear on our
independence, and where applicable, related
safeguards.
From the matters communicated with those
charged with governance, we determine those
matters that were of most signicance in the
audit of the nancial statements of the current
period and are therefore the key audit mat-
ters. We describe these matters in our audi-
tor’s report unless law or regulation precludes
public disclosure about the matter or when,
in extremely rare circumstances, we determine
that a matter should not be communicated in
our report because the adverse consequences
of doing so would reasonably be expected to
outweigh the public interest benets of such
communication.
Other Reporting Requirements
Appointment
We were first appointed as auditors by the
annual general meeting on March 13, 2017.
We have acted as auditors consecutively for
four scal years.
Other Information
The Board of Directors and the Managing
Director are responsible for the other infor-
mation. The other information comprises the
report of the Board of Directors and the infor-
mation included in the Annual Report, but
does not include the nancial statements and
our auditor’s report thereon.
Our opinion on the nancial statements does
not cover the other information.
In connection with our audit of the financial
statements, our responsibility is to read the
other information and, in doing so, consider
whether the other information is materially
inconsistent with the nancial statements or
our knowledge obtained in the audit, or other-
wise appears to be materially misstated. With
respect to the report of the Board of Direc-
tors, our responsibility also includes consider-
ing whether the report of the Board of Direc-
tors has been prepared in accordance with the
applicable laws and regulations.
In our opinion
• the information in the report of the Board of
Directors is consistent with the information
in the nancial statements
• the report of the Board of Directors has
been prepared in accordance with the
applicable laws and regulations.
If, based on the work we have performed, we
conclude that there is a material misstatement
of the other information, we are required to
report that fact. We have nothing to report in
this regard.
Helsinki February 8, 2021
PricewaterhouseCoopers Oy
Authorised Public Accountants
Jukka Paunonen
Authorised Public Accountant (KHT)
GOVERNANCE
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RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 129 | 149
FINANCIAL REVIEW
Governance
In addition to the statutory tasks and tasks laid out in
the Board’s rules of procedure, the Board of Directors
of Evli Bank Plc placed a strong focus in 2020 on the
effects of the coronavirus pandemic on Evli’s business
and the progress of the strategy in the changed
operating environment. In addition, the Board’s work
focused on evaluating the strategy of the incentive
plan business, which was strengthened through an
acquisition during the autumn, as well as Evli’s product
offering and its future development.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
130 | 149ANNUAL REPORT 2020EVLI BANK PLC
Corporate governance statement
The governance of Evli Bank Plc (“Evli” or “company”) is based
on the Articles of Association, the Finnish Limited Liability Com-
panies Act, applicable statutory provisions governing the Finn-
ish securities markets, the Market Abuse Regulation (MAR), the
regulations of the Finnish Financial Supervisory Authority, the
rules and regulations of Nasdaq Helsinki Ltd, and other sta-
tutes and regulations concerning the governance of public li-
mited companies. The Articles of Association, the published po-
licies and other information on Evli’s corporate governance can
be found at the company’s website www.evli.com/investors.
Evli also complies with the Finnish Corporate Governance Code
issued by the Securities Market Association. The Code can be
viewed in full on the Securities Market Association’s website at
www.cgfinland.fi/en.
This Corporate Governance Statement referred to in Chapter
7, section 7 of the Securities Markets Act (746/2012) has been
compiled in compliance with the Finnish Corporate Govern-
ance Code and it has been prepared as a separate report from
the Board of Directors’ Report.
Evli’s governance structure
Evli’s management and business operations are the responsibi-
lity of the General Meeting of Shareholders, the Board of Direc-
tors and the CEO, whose tasks are determined in the Finnish
Limited Liability Companies Act and in Evli’s Articles of Asso-
ciation. Evli Group’s Executive Group assists the CEO in the
operative management of the company. The Executive Group
consists of managers of the business areas and group functions,
and it helps the CEO in the approval and execution of Group-
level operating principles and procedures.
Evli Bank Plc’s Governance Structure
General Meeting of Shareholders
Auditors
Board of Directors
CEO
Executive Group
Audit committee
Compensation Committee
Risk management and Internal audit
Risk management
Compliance
Internal Audit
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 131 | 149
Evli’s Board of Directors is primarily responsible for Evli Group’s
risk management. The Board confirms the principles and
responsibilities of risk management, the risk limits of the Group
and other general guidelines according to which the risk ma-
nagement and internal audit are organised.
General Meeting of Shareholders
The ultimate decision-making power in the company is exer-
cised by shareholders at General Meetings. By participating in
the General Meeting either personally or via a proxy, a share-
holder may exercise his/her right to vote and make inquiries
and participate in decision-making on matters concerning the
company. At the General Meeting, each Series A share of Evli
Bank Plc entitles its holder to twenty (20) votes and each Series
B share to one (1) vote.
General Meetings are held at least once a year. The Annual
General Meeting (AGM) is held upon completion of the com-
pany’s financial statements, at a place and on a date designated
by the Board of Directors. The date must be no later than the
end of June.
Matters to be discussed at a General Meeting are specified
in the Limited Liability Companies Act and in Evli’s Articles of
Association. The General Meeting normally discusses not only
the matters specified by law and in the Articles of Association
but also items presented to the meeting by the Board of Direc-
tors. Under the Limited Liability Companies Act, shareholders
are also entitled to bring up for discussion at a General Meeting
any matter that falls within the authority of the meeting.
A notice to the General Meeting is published no earlier than
three (3) months prior the record date of the General Meeting,
and no later than three (3) weeks prior to the General Meeting,
however, no later than nine (9) days before the record date of
the General Meeting. The notice is published on Evli’s website,
www.evli.com and as a stock exchange release. The Board of
Directors may, at their discretion, announce the General Meet-
ing in one or more newspapers.
Documents to be presented in the General Meeting and
the Board’s proposals for decisions to the General Meeting
are made available on Evli’s website (www.evli.com) three (3)
weeks before the General Meeting.
Annual General Meeting (AGM)
At the AGM, information is presented about the company’s
activities. The AGM also decides on the following:
• the adoption of the financial statements of the previous
financial year
• the company’s profit distribution
• discharging the Board members and the CEO and his/her
deputy from liability
• the election of Board members and their remuneration
• the appointment of auditors and their remuneration.
In 2020, the AGM of Evli Bank Plc was held in Helsinki on March
9, 2020. A total of 83 shareholders participated in the AGM
either personally or via a legal representative or an authorised
proxy. A total of 69 percent of votes entitled by all shares were
represented. The AGM participants included the Board mem-
bers, the CEO and the principally responsible auditor of the
company’s auditing firm.
Extraordinary General Meeting
The Board may convene an Extraordinary General Meeting if
it considers this necessary. The auditor and any shareholder
with more than ten percent of the company’s shares also have
the right to demand that an Extraordinary General Meeting
be called to discuss a matter to be presented by the auditor
or shareholder. No Extraordinary General Meetings were held
in 2020.
Board of Directors
The AGM of Evli Bank Plc elects each year a Board of Directors,
which, between General Meetings, exercises the ultimate deci-
sion-making power in Evli Group. The task of Evli’s Board is to
manage the company in accordance with the laws and official
regulations, and in compliance with the Articles of Association
and the decisions of the General Meeting.
Duties of the Board of Directors
The Board has approved a written procedure defining its duties
and meeting practices. The tasks of the Board are:
• taking responsibility for the company’s administration and
appropriate organisation of operations
• ensuring that the company’s accounting and asset manage-
ment are monitored in an appropriate manner
• the handling of all matters that are of extensive and funda-
mental importance for the operation of the company and
the entire Group
• deciding upon the Evli Group’s business strategy and
approving the budget
• confirming the principles for the arrangement of Evli Group’s
risk management and internal audit
• appointing the CEO and the members of the Executive
Group and relieving them of their duties
• deciding on the CEO’s salary and other benefits
• approving the objectives for the Group’s human resources
planning, and monitoring the implementation of these
objectives
• deciding the basis for the Group’s remuneration system and
other comprehensive matters that concern the personnel.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 132 | 149
In accordance with the principles of good governance, the
Board also ensures that the company, in its operations, endorses
the corporate values that have been set out for compliance. The
Board conducts an annual review of its activities and working
practices in the form of an internal self-assessment.
Composition of the Board of Directors
At the AGM, four to eight (4-8) members are elected to Evli’s
Board of Directors by representatives of major shareholders
and external independent experts. The major shareholders of
the company prepare a proposal on the composition of the
Board for the AGM. The Board members should be elected
so that the composition of the Board is as diverse as possi-
ble and supports Evli’s business goals and meets the follow-
ing principles:
• The Board as a whole must have sufficient competence and
experience to be able to carry out its duties diligently and
efficiently, taking into consideration the type and scope of
the company’s operations and its strategic goals and the
changes within business and the rest of society.
• The members of the Board should have supplementary edu-
cation and skills and experience in areas that are important
to the company.
• The members of the Board should have experience of Board
work and executive duties in business or other areas of society.
• The Board should include both men and women as far as
is possible.
• The Board should also be diverse in terms of age distribu-
tion and number of terms.
In addition, in accordance with the Corporate Governance
Code 2020, persons elected to the Board must have the oppor-
tunity to spend sufficient time carrying out their duties. All
Board candidates must submit their own assessment of their
independence to the Board at least once every year. In addi-
tion, the company also evaluates the independence of all exist-
ing members on the basis of documents in its possession and,
when needed, using public documents in accordance with the
Corporate Governance Code issued by the Securities Market
Association in 2020 or other applicable regulations.
The Board members are elected for a term of one year, which
starts at the conclusion of the AGM and ends at the conclu-
sion of the next AGM following the election. The Board elects
a Chairman and a Deputy Chairman among themselves. Evli
Bank Plc’s AGM held on March 9, 2020 confirmed six (6) as the
number of members of its Board of Directors. Henrik Andersin,
Fredrik Hacklin, Sari Helander, Robert Ingman, Mikael Lilius
and Teuvo Salminen were re-elected to Evli Bank Plc’s Board of
Directors. The Board elected Henrik Andersin as the Chairman
and Mikael Lilius as the Deputy Chairman.
In 2020, the Board of Directors convened 18 times. The ave-
rage attendance rate of Board members at the meetings was
95 percent. The participation of each member in the meetings
is listed in table 1.
Evli’s current Board of Directors consists of industry experts and
the company’s major shareholders. The Board has assessed the
independence of its members and has concluded that all the
members are independent of the company, excluding Henrik
Andersin. With the exception of Henrik Andersin and Robert
Ingman, the other Board members are independent of the com-
pany’s significant shareholders. Based on the shareholdings of
controlled companies, Henrik Andersin and Robert Ingman are
not independent of the company’s significant shareholders.
Committees set up by the Board
The Board has established an Audit Committee and a Com-
pensation Committee to prepare matters to be handled by the
Board. The committees have no independent decision-making
power; instead, decisions are made by the Board on the basis
of recommendations and information supplied by the commit-
tees. The committees make regular reports on their activities
to the Board.
Audit Committee
The Audit Committee is responsible for assisting the Board in
ensuring that the company has an adequate internal audit sys-
tem covering all operations and that the company’s risk mana-
gement has been arranged appropriately. It also monitors the
financial statements reporting process.
The Audit Committee is also responsible for:
• Overseeing the accuracy and correctness of the company’s
financial reporting and monitoring the statutory auditing of
the financial statements and consolidated financial statements.
• Preparing the proposal on the appointment of auditors and
the auditors’ fees, to be made to the AGM.
• Ensuring that the company’s operations and internal audit have
been arranged in accordance with all applicable laws, regula-
tions, and good management and governance practices.
• Monitoring the activity and efficiency of the internal audit
function.
• Assessing the independence of the statutory auditor or
auditing firm, and especially the provision of ancillary ser-
vices to the company.
The Audit Committee consists of at least two members, who
may not be part of the company’s management and must be
independent of the company. In addition to the Committee’s
regular members, the meetings are attended by the auditors,
the CEO, the CFO and the internal auditor. The Committee
meets every quarter.
The Audit Committee’s members are Teuvo Salminen (Chair-
man), Sari Helander and Robert Ingman. The Committee met
five times in 2020. The Audit Committee members’ average
attendance rate at meetings was 100 percent. The participation
of each member in the meetings is listed in table 1.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 133 | 149
Compensation Committee
The Compensation Committee is responsible for assisting the
Board of Directors in the preparation of matters related to the
company’s employment terms and compensation.
In addition, the Compensation Committee assists the Board
in the following:
• Preparation of matters related to the compensation and
incentive systems for management and personnel.
• Regular assessment of the functioning of and compliance
with the compensation system.
In addition, the Compensation Committee prepares the remu-
neration policy and remuneration report of the company’s gov-
erning bodies.
The Committee consists of at least two members, elected by
the Board from among its members. The Committee Chairman
is chosen from among the Committee members and must be an
independent Board member. The members of Evli’s Compen-
sation Committee are Mikael Lilius (chairman), Henrik Andersin
and Fredrik Hacklin. The Committee met five times in 2020. The
Compensation Committee members’ average attendance rate
at meetings was 100 percent. The participation of each member
in the meetings is listed in the table 1.
Operations of the Board in 2020
In addition to statutory tasks and tasks laid out in the Board’s
rules of procedure, the Board’s work was highly determined by
the coronavirus pandemic that started in the spring of 2020.
As the disease situation in Finland deteriorated rapidly in the
second quarter of the year, the Board met weekly to assess the
effects of the crisis on the company’s operations and operat-
ing environment. In addition to the pandemic, the focus was
on monitoring and evaluating strategic objectives. The Board
became acquainted with both the institutional and private cli-
ents segments and examined the product offering of alterna-
tive investment funds. In addition, the Board monitored the
Attendance
at board
meetings in
2020
Attendance
in Audit
Committee
meetings
2020
Attendance
in Compen-
sation
Committee
meetings
2020
Ownership
in the company
1)
,
number of shares
Name Personal data A-shares B-shares
Independent
of the
company
Independent
of the
shareholders
Henrik
Andersin
Board member since 1985.
Chairman of the Board since 2006,
Born 1960, M.Sc. (Econ) Commit-
tee memberships: Compensation
Committee
18/18 5/5 3,803,280 950,820
Fredrik
Hacklin
Board member since 2019. Born
1978, Ph.D. (Management), M.Sc.
(Engineering) Committee
memberships: Compensation
Committee
17/18 5/5 2,150 √ √
Sari
Helander
Board member since 2019. Born
1967, M.Sc. (Econ) Committee
memberships: Audit Committee
18/18 5/5 3,300 √ √
Robert
Ingman
Board member since 2010. Born
1961, M.Sc. (Tech), M.Sc. (Econ.
and Business Administration
Committee memberships: Audit
Committee
16/18 5/5 1,860,000
2)
652,000
2)
√
Mikael
Lilius
Board member since 2010. Born
1949, B.Sc. (Econ. and Business
Administration). Committee
memberships: Compensation
Committee (Chairman)
17/18 5/5 40,760 √ √
Teuvo
Salminen
Board member since 2010. Born
1954, M.Sc. (Econ. and business
administration) Committee
memberships: Audit Committee
(Chairman)
17/18 5/5 70,000 √ √
1)
Shareholding on December 31, 2020, including holdings through a controlled company.
2)
Includes holdings of Ingman Group Oy Ab
progress of the information system and process development
projects.
One of the themes of the autumn was the growth strategy of
the rewards and incentive plan business, which was strength-
ened through an acquisition in September. In addition, the
Board looked at the growth prospects and future plans of the
Corporate Finance business. Based on the review, the strategic
guidelines were clarified, and it was decided to continue the
work to promote the new projects. Towards the end of the year,
Table 1: Evli Bank Plc’s Board of Directors in 2020
the focus shifted again to the largest business, the Wealth Mana-
gement and Investor Clients segment. Among other things, the
Board met with portfolio managers of the alternative invest-
ment funds and got a deeper insight into the products offered
by Evli. The strategy work also continued. In the strategic review,
the Board focused on the challenges and opportunities brought
by the changed operating environment. The discussion focused
on Evli’s product offering as a whole and possible future new
products, as well as their external communication.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 134 | 149
Diversity of the Board of Directors
The principles concerning the diversity of the Board of Direc-
tors are stated in the Board’s diversity policy, which the Board
approved on December 13, 2017. Diversity strengthens Evli’s
goal of having a Board whose overall competence profile sup-
ports the development of Evli’s business. Diversity is seen as a key
success factor that enables Evli to reach its strategic goals and
continuously improve its client-centric operations. The diversity
of the Board is viewed from different perspectives. For Evli, the
essential factors are the Board members’ versatile and comple-
mentary expertise, experience from various industries and mana-
gement, and the personal qualities of the members. The age and
gender distribution of the Board members are taken into account,
which supports the diversity of the Board. The actualisation and
development of diversity towards the goals is evaluated in the
annual self-evaluation discussion of the Board.
At the end of the financial year 2020, the Board members rep-
resented a wide range of expertise on management and board
tasks in several industries, and their educational backgrounds
and expertise complement each other. Both genders were rep-
resented on the Board. Of the Board members, 17 percent were
female and 83 percent were male. The median of the year of
birth of the Board members was 1961, and the age difference
between the youngest and the oldest member was 29 years.
Corporate management
Evli’s corporate structure
Evli’s business operations is organised around two client seg-
ments: Wealth Management and Investor Clients, and Advi-
sory and Corporate Clients. These are supported by the Group
Operations, which include Information Management, Financial
Administration, Marketing, Communications and Investor Rela-
tions, Legal and Compliance, Human Resources, Internal Ser-
vices, Risk Management and Internal Audit.
Board diversity – age
51-60 years
50%
41-50 years
17%
71-80 years
17%
61-70 years
17%
D.Sc. (Tech.)
14%
Board diversity – education
M.Sc.
(Econ. and Business
Administration)
43%
B.Sc. (Econ. and Business
Administration)
14%
M.Sc. (Tech.)
29%
Corporate management
Evli’s Board of Directors appoints the company’s CEO and
decides the terms and conditions of his or her service relation-
ship. The CEO is responsible for the company’s day-to-day man-
agement in compliance with the instructions and decisions pro-
vided by the Board. Evli Group’s Executive Group assists the
CEO in the operative management of the company.
CEO
The CEO’s duties include the management and supervision of
the Group’s business, preparation of matters to be handled
by the Board, and implementation of the Board’s decisions. In
accordance with the Limited Liability Companies Act, the CEO
ensures that the company’s accounting is lawful, and that the
asset management is arranged reliably.
The CEO’s period of notice is six months, and the severance
compensation payable to the CEO in addition to the salary
for the period of notice corresponds to 12 months’ salary. The
CEO’s retirement age is 63 years. The company’s CEO is Maunu
Lehtimäki, M.Sc. (Econ.), born in 1967. In 2020, the CEO was
paid EUR 343,440 in salary and fringe benefits, performance
bonuses amounting to EUR 58,849 and a supplementary pen-
sion of EUR 51,516, totalling EUR 453.805. In addition, the
CEO subscribed to the 40,000 shares granted to him in the
Option-program 2016. The total value of the subscription was
EUR 372,000 based on the closing price on the subscription day.
The CEO was allocated 50,000 Evli shares, as part of the share-
based incentive plan established in 2019. The CEO Maunu Leh-
timäki’s share ownership in Evli Bank Plc is shown in table 2.
Executive Group
The Executive Group consists of the CEO and six members. The
CEO presents a proposal regarding the choice of members
to the Executive Group, and these names are then subject to
Board diversity – gender
6 persons
Male
83%
Female
17%
GOVERNANCE
FINANCIAL REVIEW
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ANNUAL REPORT 2020EVLI BANK PLC 135 | 149
confirmation by the Board of Directors. The CEO convenes the
Executive Group as necessary and serves as its Chairman. The
Executive Group normally meets twice a month. The Executive
Group’s task is to support the CEO in preparing and implement-
ing the strategy and in coordinating the Group’s operations.
The Executive Group’s duties also include preparing and exe-
cuting matters that are significant or involve fundamental prin-
ciples and ensuring internal co-operation and communication.
Operations of the Executive Group in 2020
In 2020, the Executive Group met twice a month, on average.
The exceptional year, due to the coronavirus pandemic, was also
reflected in the work of the Executive Group. With the intro-
duction of continuous remote working, the operating methods
rapidly changed and this, combined with the impacts of the
pandemic on the business environment, guided the Executive
Group’s work throughout the spring. In addition to the normal
strategic focus areas, growing the client base, expanding the
product range and streamlining operations, the Executive Group
focused on ensuring that the corporate culture and continuous
contact with clients was maintained in the remote working envi-
ronment.
Despite the difficult operating environment in the spring, the pro-
duct range was expanded in line with the strategy, for example by
launching Evli’s first infrastructure fund. The project portfolio, with
various development projects, also advanced and development
projects were finalised, creating a good base for the future.
During the summer and autumn, the market calmed down and
the work of the Executive Group focused more on growth. In
the Wealth Management and Investor Clients segment, the
focus areas were new client acquisition and the success of exist-
ing products. Among the processes, the outsourcing of custody
activities, among others, was also developed at the Executive
Group level. The project was completed at the end of the year.
In the Advisory and Corporate Clients segment, the merger
between Evli’s subsidiary focusing on incentive programs and
Alexander Incentives Oy, which plans incentive programs, was
Ownership in the company
1)
,
number of shares
Name Area of responsibility A-share B-share
Maunu Lehtimäki
2)
born in 1967, M.Sc. (Econ.) CEO 533,728 171,031
Mari Etholén
3)
born 1973, LL.M. Legal and Human Resources functions 60,000 16,306
Panu Jousimies
4)
born in 1969, M.Sc. (Econ.) Production and execution of securities transactions 59,691 114,249
Juho Mikola
5)
born in 1981, M.Sc. (Econ.) Financial and Group Administration, Deputy CEO 68,000 32,787
Esa Pensala
6)
born in 1974, M.Sc. (Tech) Private clients 142,000 35,500
Kim Pessala
7)
born in 1969, M.Sc. (Econ.) Institutional clients 12,331 92,331
Mikael Thunved
4)
born in 1965, B.Sc. (Econ.) Corporate Finance business - 95,000
1)
Shareholdings on December 31, 2020, including holdings through controlled entities.
2)
50,000 Evli shares allocated under the share-based incentive scheme established in 2019.
3)
9,334 Evli shares allocated under the share-based incentive scheme established in 2018 and 20,000 Evli shares under the share-based incentive scheme
established in 2019.
4)
20,000 Evli shares allocated under the share-based incentive scheme established in 2019.
5)
18,400 Evli shares allocated under the share-based incentive scheme established in 2017, 9,334 Evli shares under the share-based incentive scheme
established in 2018 and 30,000 Evli shares under the share-based incentive scheme established in 2019.
6)
30,000 Evli shares allocated under the share-based incentive scheme established in 2019.
7)
9,334 Evli shares allocated under the share-based incentive scheme established in 2018 and 20,000 Evli shares under the share-based incentive scheme
established in 2019.
Table 2: Evli’s Executive Group in 2020
Additional information
Board of Directors p. 147
Executive Group p. 148
executed during the autumn. By merging the operations, Evli
can serve its clients through the whole value chain of incentive
programs, from planning to management and implementa-
tion, which enables a completely new kind of growth potential
in both Finland and internationally. In addition to administra-
tive and strategic work, the members of the Executive Group
strived to participate in client and other stakeholder meetings
as much as possible, within the limits allowed by the corona-
virus restrictions.
Risk management and internal control
Evli’s values and its policy of transparent and appropriate com-
munications support the company’s operational integrity and
high ethical standards. The company’s organisational structure,
clearly established responsibilities and authorisations, and its
competent employees support the planning, execution, control
and monitoring of business operations in a manner that facili-
tates the achievement of set objectives.
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Risk management refers to actions aimed at systematically sur-
veying, identifying, analysing and preventing risks. The objec-
tives of risk management are to:
• ensure the sufficiency of own assets in relation to risk posi-
tions
• ensure that fluctuations in financial results and valuations
remain within the confirmed objectives and limits
• price risks correctly to achieve sustainable profitability
• support the uninterrupted implementation of the Group’s
strategy and income generation.
Evli defines risk as an event or series of events that jeopardise
the company’s income generation over the short or long term.
Evli’s Board of Directors is primarily responsible for Evli Group’s
risk management. The Board confirms the risk management pol-
icies, responsibilities, the Group’s risk limits, and other general
guidelines governing how risk management and internal con-
trol are to be organised. The Board has also set up a credit and
asset-liability committee (Credalco), which briefs it on risk-tak-
ing matters. In addition to the general risk management policies,
Evli Group’s risk management is founded on the “three lines of
defence” model.
First line of defence – business units
Risk management is a part of internal control, and therefore the
responsibility for executing risk management measures lies first
with the business units, as the first line of defence. The mana-
gers of the business units are responsible for ensuring that risk
management is at a sufficient level in each respective unit. The
task of business units is to:
• build the processes and competence for risk management
and internal audit
• identify and analyse risks
• make decisions on risk management by means of various
protection measures.
Evli Group’s risk management’s three lines of defence
Board of Directors and Executive Group
Credit and asset-liability committee (Credalco)
2nd line
of defence
1st line
of defence
3rd line
of defence
Business processes
Internal audit
Independent of business operations. Supports the Board of Directors
and senior management in assessing internal control
Risk Management and Compliance
Independent of business operations. Develops, maintains
and oversees the general principles of risk management
Business units
Risk management and internal audit in daily operations
and identifying and analyzing risk
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Second line of defence – Risk Control and Compliance
The second line of defence comprises the independent Risk
Control and Compliance functions, whose primary tasks are
to develop, maintain and oversee the general principles and
framework of risk management.
The Risk Control function oversees daily operations and com-
pliance with the risk limits granted to the business units, as well
as compliance with risk-taking policies and guidelines. The Risk
Control function reports monthly on Evli Group’s overall risk
position to the Board and the Executive Group.
The Compliance function is responsible for ensuring compli-
ance with the rules in all of Evli Group’s operations by support-
ing operating management and the business units in applying
the provisions of the law, the official regulations and internal
guidelines, and in identifying, managing and reporting on any
risks of insufficient compliance with the rules in accordance with
the separate compliance policy and monitoring plan confirmed
by Evli’s Board of Directors. The Compliance function reports
regularly via the audit committee to Evli’s Board and also to the
operating management.
Third line of defence – Internal Audit
The third line of defence is Internal Audit. The Internal Audit is
a support function for the Board of Directors and senior man-
agement that is independent of the business functions. It is
administratively subordinate to the CEO and reports to the
CEO and, via the Audit Committee, to the Board of Evli Bank.
The Internal Audit assesses the functioning of Evli Group’s inter-
nal control system, the appropriateness and efficiency of the
functions and the compliance with instructions. It does this by
means of inspections that are based on the internal audit action
plan adopted annually by the Audit Committee of the Board of
Evli Bank. The Internal Audit follows not only the internal audit
guidelines, but also the internationally acknowledged frame-
work of professional practices (The Institute of Internal Audi-
tors) and corresponding guidelines on information systems
audit standards (The Information Systems Audit and Control
Association).
Audit
The shareholders elect the company’s auditors each year at the
AGM. The auditors must be an auditing firm approved by the
Finland Chamber of Commerce. The auditors’ term continues
until the end of the first AGM that follows the election of the
auditors. The auditors’ duties are to ensure that the financial
statements have been prepared in accordance with the appli-
cable statutes and provide a true and fair view of the company’s
financial position and performance and other necessary infor-
mation for the company’s stakeholders.
As part of their annual audit duties, the auditors of Evli Bank Plc
audit the accounts and administration of the separate compa-
nies. The internal audit requirements are taken into account in
the auditors’ audit plans. Each year, the auditors submit their
report to the AGM of Evli Bank Plc. The auditors also report
the main points of the annual audit plan to the Board of Direc-
tors and to the Board’s Audit Committee as well as presenting,
in connection with each interim report and the financial state-
ments, a written audit report covering the entire Group.
The AGM held on March 9, 2020, elected PricewaterhouseCoop-
ers Oy, an auditing firm, as the auditor, with Jukka Paunonen,
Authorised Public Accountant, as the principally responsible
auditor. PricewaterhouseCoopers Oy generally serves as the
auditor for all of the subsidiaries, with the exception of Terra
Nova Capital Advisors Ltd. Terra Nova’s auditor is RSM Dah-
man Auditors.
In 2020, the auditing firms were paid fees totalling EUR
263,646.00. The fees for auditing came to EUR 207,805.50,
and the fees for services unconnected with auditing were EUR
55,840.50. Other fees consist mainly of tax and legal advisory
services.
Insider management
Evli has a guideline on insider rules and regulations that is
approved by its Board of Directors and is based on the Market
Abuse Regulation (MAR), Nasdaq Helsinki Ltd’s Guidelines for
Insiders of Listed Companies, as well as other relevant regulations
and directives. Evli Group companies that are registered outside
of Finland shall comply not only with these guidelines, but also
with the national legislation and official regulations of the country
where the company is located. The guideline on insider rules and
regulations is distributed to all persons engaged in an employ-
ment or service relationship with the Group. The persons defined
in the guideline on insider rules and regulations shall comply with
the restrictions regarding the use of insider information and trad-
ing, for example the closed window period. Evli maintains a regis-
ter of permanent insiders, which includes members of the Board
of Directors and Executive Group. Evli also maintains registers of
project-specific and transaction-specific insiders that are required
at any given time. The insider registers are maintained in the Tick-
er-system and Euroclear Finland Ltd’s SIRE system.
Evli also has specified that members of the Board of Directors
and Executive Group and their related parties are required to
disclose their business transactions with Evli Bank Plc’s shares
and other financial instruments based on these. The register of
persons subject to the disclosure requirement is maintained
in the Euroclear Finland Ltd’s SIRE system. Evli publishes as a
stock exchange release the transactions related to Evli’s shares
and other financial instruments made by persons in manage-
ment positions in the company and their related parties, as
required by the MAR.
Evli’s insiders may not trade in securities issued by the company
for 30 days before the publication of an interim report or the
financial statements bulletin. Evli also applies a similar 30-day
trading restriction to Evli Group’s employees who participate in
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the preparation or publication of the interim report and finan-
cial statements and who become aware of unpublished financial
information at the Group level. The person in charge of insider
issues at Evli is the company’s Head of Legal Affairs. Evli evalu-
ates and monitors related party transactions between the com-
pany and its related parties.
Evli maintains a list of related parties. Evli’s related parties com-
prise its subsidiaries as well as the Board of Directors, the CEO,
and the Executive Group, including any companies controlled
or significantly influenced by them. Evli’s financial management
monitors and reports related party transactions as part of the
company’s normal reporting and control practices. Related
party transactions which are not considered normal business
activities are decided by the Board of Directors. Evli reports
relevant and material related party transactions annually in the
notes of the consolidated financial statements.
Financial reporting
The Board of Directors is responsible for overseeing Evli Group’s
financial reporting. The Audit Committee assists the Board in
this work. The CEO’s and CFO’s tasks are to monitor and ensure
that the accounting and the financial reporting accord with the
law, the Group’s accounting policies and the guidelines and
orders issued by the Group’s Board of Directors.
The Group’s accounting and results reporting are centralised
under the responsibility of the Group’s Financial Administra-
tion unit. The Financial Administration unit is subordinate to
the CFO and is responsible for producing, on a centralised
basis, the financial statements information required for exter-
nal accounting. The unit also produces internal accounting anal-
yses and the results reports for monitoring business activities,
the separate companies and the Group’s profitability. Profit per-
formance is reported monthly both to the Executive Group and
the Board of Directors in the form of specific results reports.
The aim is to identify and demonstrate success factors as well
as development areas well in advance, thus making it possible
to react to these. Reporting practices are also used for moni-
toring the implementation of the business plans for the busi-
ness units. The Group’s Financial Administration unit is also
responsible for monitoring and reporting on the performance
of each business unit. Further responsibilities include report-
ing the financial results, sales and activity at least monthly, and
even daily depending on the unit, to the Executive Group and
other concerned parties.
Evli Group complies with the International Financial Reporting
Standards (IFRS) approved for application in the EU. The Group
prepares annual financial statements and also quarterly interim
reports (IAS 34). The instructions on financial reporting and the
accounting principles are applied in all of the Group compa-
nies. The accounting of all of the Group companies is included
in the same accounting system, with the exception of the mana-
gement companies of the private equity funds and the Group
company in the United Arab Emirates.
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Remuneration policy
Introduction
The following Remuneration Policy of Evli Bank Plc (“Evli” or
“company”) describes the general principles and the framework
concerning the remuneration of the Board of Directors and the
CEO. The policies regarding the CEO also apply to a poten-
tial Deputy CEO. Evli also complies with the Finnish Corpo-
rate Governance Code issued by the Securities Market Associ-
ation. The objective of Evli Group’s remuneration model is to
support the implementation of the company’s strategy and to
promote the company’s competitiveness and long-term finan-
cial success. A further aim is to contribute to a positive trend
in shareholder value, committing Evli’s Board of Directors and
CEO to the company’s objectives in the long run.
Evli complies with the Securities Market Association’s Corpo-
rate Governance Code. This Remuneration Policy has been
prepared in accordance with the Corporate Governance Code
2020. Evli’s Remuneration Policy is presented at Evli’s Annual
General Meeting (AGM) at least every four years and whenever
significant changes are proposed. The Remuneration Report is
presented annually, starting from the year 2021, at Evli’s AGM.
In all remuneration, Evli complies with applicable financial re-
gulations. This Remuneration Policy has been prepared taking
into account the applicable regulations and Evli Group’s over-
all remuneration model for all employees. The Remuneration
Policy must comply with the remuneration principles applicable
to all Evli employees.
The Group’s remuneration model consists of the following ele-
ments:
• a competitive fixed basic salary constitutes a solid foundation
for maintaining and constantly developing basic functions
• a variable remuneration, in accordance with the annual
remuneration plan approved by the Board of Directors, to
promote both Evli’s short-term growth objectives and the
attainment of its strategic targets
• long-term incentive programs to support the company’s
strategic development and to commit key employees to
the company’s business operations.
In accordance with the remuneration principles, the variable
bonus may not exceed 100 percent of the annual fixed salary.
Correspondingly, the variable remuneration and the long-term
incentives may not exceed 200 percent of the annual fixed salary.
Decision-making relating to remuneration
The Remuneration Policy is prepared by the Board’s Compen-
sation Committee and approved by the Board for presentation
to the General Meeting. Compliance with, and the performance
and outcomes of, the remuneration model are monitored by
the Compensation Committee appointed by the Board of
Directors, and by the Board of Directors. The company’s inter-
nal audit conducts an annual audit of the remuneration.
The remuneration of members of Evli Group’s bodies is always
decided by the body that has appointed them.
Evli’s AGM decides on the compensations payable to the mem-
bers of the Board of Directors. The company’s major sharehold-
ers are responsible for preparing the remuneration proposal.
The principles and elements of the remuneration of the CEO
and any Deputy CEO are approved by Evli’s Board of Directors
in accordance with this Remuneration Policy. The Compensa-
tion Committee, appointed by the Board of Directors, prepares
proposals on matters related to remuneration for decision-mak-
ing by the Board. All changes to the CEO’s salary and remu-
neration or executive contract are made by the Board of Direc-
tors based on a proposal by the Compensation Committee in
accordance with the Remuneration Policy.
Remuneration of the Board of Directors
In general, the remuneration of the Board of Directors is
decided by the General Meeting based on a proposal by the
major shareholders. The decision on the remuneration of the
members of the Board of Directors shall be based on the Remu-
neration Policy presented to the AGM and which is in force.
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The remuneration of the members of the Board of Directors
consists of a fixed monthly compensation and possible com-
pensation for meeting attendance. The Chairman of the Board
of Directors and the chairmen of the committees appointed by
the Board of Directors may be paid an increased compensation.
In situations in which a member of the Board of Directors par-
ticipates in project-based activities to develop the company’s
operations outside the work carried out by the Board of Direc-
tors, a separate compensation may be paid for such work at the
Board’s discretion. In addition to the monthly compensation and
compensation for meetings, the members of the Board of Direc-
tors are compensated for their travel expenses. In principle, the
Board of Directors’ compensation and allowance are paid in cash.
Remuneration of the CEO
The Board of Directors of Evli Group adopts the principles and
elements of the CEO’s remuneration on an annual basis in line
with the Remuneration Policy in force. All changes to the CEO’s
salary and remuneration are subject to approval by the Board
of Directors. The CEO’s remuneration is comprised, in principle,
of a fixed salary, variable remuneration, and long-term incen-
tives and commitment programs. In addition, the CEO may be
granted a separate, reasonable retirement plan or other bene-
fits to ensure that a competent CEO is committed to the com-
pany’s development.
The amount of the CEO’s variable remuneration and the relative
proportion to his fixed salary are within the limits set by financial
regulations. The CEO’s variable remuneration shall not exceed
100 percent of the CEO’s annual fixed salary. Correspondingly,
the CEO’s variable remuneration and the long-term incentives
may not exceed 200 percent of the CEO’s annual fixed salary.
The variable bonus is linked to the company’s financial success
and the achievement of its strategic goals. If deemed perti-
ELEMENTS OF THE
REMUNERATION PURPOSE AND LINK TO STRATEGY DESCRIPTION
Fixed salaries
The aim is to recruit and commit high-
quality experts to implement the
company’s strategy.
The base salary includes taxable fringe benefits (for example, a mobile phone). When evaluating the base salary level, a variety of factors
can be taken into account, such as market conditions, competitiveness, past performance and individual skills, as well as experience in the
company and in business management. The base salary is, in principle, reviewed annually.
Short-term
incentives (STI)
The purpose is to encourage and guide
in achieving short-term financial and
operational goals.
The short-term incentive scheme is based on one-year performance criteria. Rewards are paid in cash after the end of the performance
period, based on the achievement of the targets. The maximum pay-out for the annual incentive is capped. Short-term incentives are tied
to the company’s financial success, adherence to policies and guidelines, and ensuring solvency. The annual short-term incentive may not
exceed 100 percent of the annual fixed salary of the person in question.
Long-term
incentives (LTI)
The purpose is to encourage for long-term
shareholder value growth and commitment
to the company.
The Board of Directors decides on long-term incentives within the limits set by the Annual General Meeting. Long-term incentive
programs generally include a minimum three-year earning period. The Board of Directors sets the targets, indicators and their weightings
that may be the basis for the incentives. Long-term incentive programs can also be purely engagement programs if they are considered
to support the execution of the company’s long-term strategy. At the end of the earning period, the Board of Directors can evaluate the
award criteria to determine the final payment level. The annual short- and long-term incentives may not exceed 200 percent of the annual
fixed salary of the person in question.
Pension
The purpose is to provide a pension in
accordance with local market practices.
The retirement age and any supplementary pension arrangements provided are decided by the Board of Directors in line with market
practices.
Share ownership
The purpose is to ensure strong alignment
between the interests of the CEO and the
shareholders in the longer term.
The Board decides on the long-term target share ownership for the CEO.
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nent, the company may, by a decision of the Board of Direc-
tors, decide not to pay the variable bonus, in whole or in part.
The Board decides on the long-term incentive and commitment
schemes for the CEO on a case-by-case basis.
In certain circumstances, the company is obliged to defer pay-
ment of the variable bonus. In such case, the company will defer
payment of the variable bonus in accordance with the regula-
tions set by the financial market. The amount of the bonus pay-
able after the deferral depends on the financial performance of
the company during the deferral period and may even be zero.
The company expects that the CEO will not hedge with his/her
personal actions against any risk related to the amount or tim-
ing of future variable remuneration. In certain circumstances,
the company may also reclaim a variable bonus already paid.
The company shall also always have the right to reclaim a va-
riable bonus already paid if, after such payment, it becomes
apparent that the person receiving the bonus has endangered
the financial position of the company, violated the company’s
operating principles and practices, or contributed to such con-
duct through neglect. The CEO has a notice period consist-
ent with current market practices. Similarly, in cases where the
CEO’s contract is terminated by the company, he/she is entitled
to severance pay in accordance with prevailing market practices.
The above matters concerning the CEO also apply to a poten-
tial Deputy CEO.
Conditions for temporary deviation
The remuneration of the company’s bodies must, in general,
be based on the Remuneration Policy approved by the Gene-
ral Meeting. Deviations from the policy’s principles can only
be made if the achievement of the company’s long-term goals
and strategy is otherwise judged to be at risk. The option to
temporarily deviate from the Remuneration Policy of the bo-
dies is intended to apply only in exceptional circumstances in
which the core operating circumstances of a listed company
have, after the General Meeting’s consideration of the bodies’
Remuneration Policy, changed as a result of a change of CEO
or a merger or an acquisition proposal, and the existing Remu-
neration Policy is thus no longer appropriate in the changed
circumstances.
If the deviation from the Remuneration Policy is expected to
continue other than on a temporary basis, the company shall
draw up a new Remuneration Policy, which will be discussed at
the next AGM. Because of the provisions regarding the notice
to the AGM and the availability of the meeting materials, there
may be insufficient time to submit a new Remuneration Policy
to the next AGM if the need for deviation arises close to the
time of the meeting. In such a case, the Remuneration Policy
shall be submitted to the General Meeting for which it can be
appropriately prepared. If the temporary deviation from the
Remuneration Policy concerns the remuneration of a new CEO
or is due to a corporate restructuring or similar exceptional cir-
cumstances, the new remuneration terms will apply as agreed
regardless of the duration of the temporary deviation. Devia-
tions from the policies and principles of the policy are docu-
mented and reported to the Board of Directors and as part of
the remuneration report at the AGM.
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Remuneration Report 2020
Evli Bank Plc (“Evli” or “company”) has published its first remu-
neration report in accordance with the Corporate Governance
Code 2020 for the financial year beginning on January 1, 2020.
This Remuneration Report sets out how Evli has implemented
its Remuneration Policy in 2020 and presents the remuneration
and other financial benefits paid to the members of the Board
of Directors (“Board”) and the Group’s CEO during the year.
The Remuneration Report has been reviewed by Evli’s Com-
pensation Committee and approved by the Board. The share-
holders will make an advisory decision on the approval of the
Remuneration Report at Evli’s Annual General Meeting 2021.
Overview of remuneration in 2020
Remuneration of the company’s governing bodies is based on
the Remuneration Policy that was presented for an advisory
decision at the Annual General Meeting held on March 9, 2020.
The policy will be applied until the Annual General Meeting
2024, unless the Board decides to bring it forward for an advi-
sory decision at an earlier General Meeting.
The decision-making process on remuneration, as defined in
the Remuneration Policy, has been followed in the remuner-
ation decision-making in 2020. No temporary deviations from
the Remuneration Policy were applied in 2020. Furthermore,
the Board did not observe any circumstances or activities that
would have resulted in a need to apply claw-back clauses appli-
cable to the CEO’s variable remuneration in 2020. Regardless of
the extraordinary business environment caused by the COVID-
19 pandemic, the Board did not deem it necessary to use its
right to adjust the performance criteria applied in 2020.
In line with the Remuneration Policy, remuneration in 2020 has
supported Evli’s business strategy with a focus on creating long-
term growth and shareholder value. Although a significant part
of the CEO’s total remuneration is in the form of fixed pay-
ments, performance-based components are set to encourage
the achievement of targets. Remuneration is balanced to avoid
excessive risk-taking. The Compensation Committee has eval-
uated the CEO’s remuneration for 2020 to ensure a competi-
tive and fair total remuneration opportunity compared to rele-
vant peers and the market. To encourage share ownership in
the company, shareholding guidelines for the CEO were in
place to further support and align shareholder and top exe-
cutive interests.
Development of financial performance and
remuneration
5-year development of financial performance
Evli’s business has developed steadily over the past five years.
The company has set four key performance indicators that it
considers to be good proxies for its business performance.
These are the development of assets under management, the
recurring revenue ratio, return on equity and net commission
income. From a shareholder perspective, the company has
been able to provide stable returns to investors as depicted
by dividend per share development.
Net Assets Under Management
(bn €)
10.6
11.2
11.4
14.3
14.1
2019 20202016 2017 2018
Evli Bank Plc
Northern Horizon Capital A/S
Evli Alexander Incentives Oy
Net commission income
(M€)
2019
67.1
72.2
76.8
20202016 2017
54.3
2018
65.2
Proportion of recurring revenue
to operating expenses
(%)
113
124 124
94
113
20202016 2017 2018
2019
Return to equity
(%)
23.0 23.4
26.2
14.3
25.5
20202016 2017 2018
2019
*Diluted IFRS.
**Board of Directors’ proposal.
Earnings/share*
(€)
and dividend/share
(€)
0.42
0.40
0.69
0.68
0.71
0.52
0.66
0.61
20202016 2017 2018
2019
0.87
0.73**
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ANNUAL REPORT 2020EVLI BANK PLC 143 | 149
2016 2017 2018 2019 2020
Board of Directors
Chairman of the Board of Directors, EUR 72,000 72,100 86,500 90,000 84,000
Development, % - 0.1% 20% 4% -7%
Chairmen of the committees (on average), EUR 52,400 52,400 70,834 72,000 67,200
Development, % - - 35% 2% -7%
Other members of the Board of Directors (on average), EUR 49,200 49,200 60,000 60,000 56,000
Development, % - - 22% - -7%
CEO
CEO, EUR 431,840 422,673 440,109 488,116
3)
446,605
4)
Development, % - -2% 4% 11% -9%
Average employee salary
Total salary costs, EUR 27,690,982 28,857,269 27,910,327 30,373,161 30,546,297
Number of employees at the end of the year 244 240 254 249 261
Average salary for the employees, EUR
1)
113,488 120,239 109,883 121,981 122,676
Development, % - 6% -9% 11% 1%
Financial performance
Financial performance of the company
2)
60,016,144 71,399,497 68,508,584 75,797,457 79,700,850
Development, % - 19% -4% 11% 5%
1)
The salary development of the average employee is calculated from personnel expenses by deducting other personnel expenses from the total
and dividing it by the number of employees at the end of the year.
2)
Development of net revenue
3)
In addition, the CEO subscribed to the 212,500 shares granted to him in the Option-program 2014. The total value of the subscription was
EUR 1,810,500 based on the closing price on the subscription day. The gross earned income was EUR 1,388,800.
4)
In addition, the CEO subscribed to the 40,000 shares granted to him in the Option-program 2016. The total value of the subscription was
EUR 372,000 based on the closing price on the subscription day. The gross earned income was EUR 93,732.
5-year Development of Remuneration
Remuneration of the Board of Directors in 2020
Evli Bank Plc’s General Meeting decides on the compensations
payable to the Board members. The Annual General Meeting
of March 9, 2020 made the following resolution on the compen-
sation for attendance at meetings payable to the Chairman of
the Board and other members:
• Chairman of the Board EUR 7,500 per month
• Chairmen of the committees EUR 6,000 per month
• Members EUR 5,000 per month
The Board has established and appointed an Audit Commit-
tee and a Compensation Committee to prepare matters to be
handled by the Board. In the spring the Board of Directors cut
its compensations for four months due to the COVID-19 pan-
demic. In 2020, the total compensation paid to the Evli Group
Board members amounted to EUR 386,400. This sum is made
up of meeting participation fees related to the work carried out
in the Board and its committees. In 2020, the Board members
did not receive any shares or share-based rights as compensa-
tion for their work, nor were they granted any other benefits.
2020
Henrik Andersin, Chairman of the Board 84,000
Fredrik Hacklin, member of the Board of Directors 56,000
Sari Helander, member of the Board of Directors 56,000
Robert Ingman, member of the Board of Directors 56,000
Teuvo Salminen, Chairman of the Audit Committee 67,200
Mikael Lilius, Vice Chairman of the Board, Chairman of
the Compensation Committee 67,200
Total 386,400
Short-term incentive plan criteria 2020 Weight
Evli Group financial performance 50%
Group level Key Performance Indicator targets 30-50%
Finalising strategic projects 0-20%
Compensation paid to the members of the board, €
Remuneration of the CEO
The Board of Evli Group adopts the principles and elements of
the remunerations for the CEO on an annual basis. The remu-
neration of the CEO follows Evli’s Remuneration Policy in force.
All changes in the CEO’s salary and remuneration are subject
to the Board’s approval.
Application of performance criteria in 2020
In 2020, Evli had a short-term incentive plan in place for the
CEO. No long-term incentive plans were issued to the CEO du-
ring 2020. The purpose of the short-term incentive is to incentiv-
ise for the achievement of stretched financial and non-financial
short-term targets aligned with the business strategy. The short-
term incentive plan remuneration is dependent on the financial
performance of Evli, as well as reaching strategic targets. The
short-term incentive plan performance criteria are evaluated
annually by the Board. The Board also resolves on the perfor-
mance targets for the short-term incentive plan at the begin-
ning of the financial year.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 144 | 149
Restricted Share
Plan 2017
Restricted Share
Plan 2018
Restricted Share
Plan 2019
Installment I Installment II Installment III Installment I Installment II Installment III
Grant Date 5.9.2017 10.9.2018 14.6.2019 8.6.2018 Not granted 11.6.2020 14.6.2019
Payment 23.9.2020 30.9.2021 30.9.2022 30.6.2021 30.6.2022 30.6.2023 30.6.2023
Vesting 30.9.2021 30.9.2022 30.9.2023 30.6.2022 30.6.2023 30.6.2024 30.6.2024
Granted Reward Shares (gross)
Maunu Lehtimäki, CEO - - - - - - 50 000
Juho Mikola, Deputy CEO 9 200 9 200 9 200 4 667 - 4 667 30 000
Plan Granted Granted options Subscription period
Option Program 2016 August 19, 2016 40,000 June 1, 2020 to August 31, 2020
Although the business environment turned out to be extraor-
dinary during 2020 due to the COVID-19 pandemic, no adjust-
ments were made to the performance targets, due to Evli’s rela-
tively strong performance despite the challenging environment.
The criteria outcome in the short-term incentive plan 2020 was
at the target level. In accordance with the remuneration policy,
the maximum earnings from the short-term incentive plan was
100 percent of the annual fixed earnings, while the maximum
earnings from both the short-term and the long-term incentive
plans were a maximum of 200 percent of the total fixed annual
earnings. During 2020, the company paid the CEO the rewards
that were earned for the short-term incentive plan 2019, based
on the performance targets set for the financial year 2019 and
for the long-term retention plan 2016-2020.
Share-Based Incentives
The purpose of the share-based retention plans is to encour-
age the executives and the selected key employees to work
on a long-term basis to increase shareholder value and to
commit to the company. The shares are paid after a vesting
period of a minimum of three years, provided that the person
in question is still employed by Evli. The Board decides annu-
ally on the issuance of new plans based on the Compensa-
tion Committee’s proposal within limits provided by the Gene-
ral Meeting.
The Restricted Share Plan offers an opportunity to earn a pre-
determined number of the company’s shares as a reward for
continuous service and retention. Evli’s Restricted Share Plans
consist of one to three, annually commencing periods followed
by vesting periods of a minimum of three years. After the vest-
ing period, shares in the Restricted Share Plans are usually deli-
vered to the participants provided that their employment with
the company has continued uninterrupted throughout the dura-
tion of the plan and until the shares are delivered. The vest-
ing period is further followed by a one-year waiting period in
accordance with the regulation set for the financial sector. The
possible rewards under the Restricted Share Plans are paid
as a combination of shares and cash. The cash component is
dedicated to cover the taxes and tax-related costs related to
restricted shares.
Payment schedule for share based incentives
Remuneration of the CEO in 2020
Evli’s CEO in 2020 was Maunu Lehtimäki. The CEO was paid
EUR 343,440 in salary and fringe benefits, performance bonuses
amounting to EUR 58,849 and a supplementary pension of EUR
51,516, totalling EUR 453,805. In addition, the CEO subscribed
to the 40,000 shares granted to him in the Option-program 2016
at a price of 6.992 euro/share. The total value of the subscrip-
tion was EUR 372,000 based on the closing price on the sub-
scription day.
Summary of share based incentives paid to CEO in 2020
The CEO has no significant separate fringe benefits and is co-
vered by the shared Evli Group reward system. The CEO is co-
vered by a six-month period of notice binding to both parties.
The CEO is entitled to receive a severance pay corresponding
to 12-months’ salary if the CEO´s contract is terminated by the
company.
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 145 | 149
CEO, € Base salary
Additional
pension payment
Paid annual
incentive
Paid long-term
retention
Total paid
compensation
Earned annual
incentive
Earned long-term
retention
Total earned
compensation
CEO, Maunu Lehtimäki 343,440
1)
51,516 58,849
2)
93,732
3)
547,537 144,422
4)
-*
5
) 144,422*
6)
Deputy CEO, € Base salary
Additional
pension payment
Paid annual
incentive
Paid long-term
retention
Total paid
compensation
Earned annual
incentive
Earned long-term
retention
Total earned
compensation
CFO, Deputy CEO,
Juho Mikola 163,200
1)
- 58,849
2)
171,953
3)
394,002 99,602
4)
-*
5)
99,602 *
6)
1)
Including fringe benefits
2)
Earned in 2019.
3)
Long-term retention for 2016-2020. 40,000 gross shares at July 15, 2020 share price EUR 6.992.
4)
Earned in 2020, paid in 2021.
5)
No long-term retention plans introduced for the CEO in 2020.
6)
Total Annual incentives and long-term retention earned in 2020.
*Actual value depends on Company share price at the reward payment date. For illustration purposes
valued here using share price when plan was introduced.
1)
Including fringe benefits
2)
Earned in 2019.
3)
Long-term retention for 2016-2020. 35,000 gross shares at July 15, 2020 share price EUR 6.992.
4)
Earned in 2020, paid in 2021.
5)
No long-term retention plans introduced for the Deputy CEO in 2020.
6)
Total Annual incentives and long-term retention earned in 2020.
*Actual value depends on Company share price at the reward payment date. For illustration
purposes valued here using share price when plan was introduced.
Structure of paid compensation in 2020
Base salary
Additional pension
Paid annual incentive
Paid long-term retention
Base salary
Additional pension payment
Paid annual incentive
Paid long-term retention
Structure of paid compensation in 2020
Remuneration of the Deputy CEO in 2020
Remuneration of the CEO in 2020
41%
0%
15%
44%
63%
11%
9%
17%
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 146 | 149
Board of
Directors
The composition of the Board of Directors
was resolved at Evli Bank Plc’s Annual
General Meeting on March 9, 2020.
Shareholdings on December 31, 2020
Henrik Andersin, born 1960
M.Sc. (Econ.)
• One of Evli Bank’s founding partners and main owners
• Chairman of the Board of Directors of Nokian Pan-
imo Oy and Oy Scripo Ab
• Member of the Board of Directors of Evli Bank Plc
since 1985, CEO of Evli Bank Plc 1994-2006 and
Chairman of the Board since 2006
• Shareholding: Holdings through controlled com-
pany Oy Scripo Ab 3,803,280 A shares and 950,820
B shares
Fredrik Hacklin, born 1978
Ph.D. (Management), M.Sc. (Engineering)
• Professor of Entrepreneurship at Vlerick Business
School, associate professor at ETH Zurich
• Previous positions at Booz Allen Hamilton, Harvard
University, Ericsson
• Advised multinationals and governments on entre-
preneurship, strategy and technology manage-
ment
• Member of the Board of Directors of Evli Bank Plc
since 2019
• Shareholding: 2,150 B shares
Sari Helander, born 1967
M.Sc. (Econ.)
• Partner, Greenstep Oy
• Previously served as CEO, Greenstap Oy. Before this
Senior Vice President (Logistics Solution) and CFO at
Posti Group Corporation and Vice President, Busi-
ness Reporting & Control Nokia Corporation
• Member of the Board of Directors of Enersense Inter-
national Plc and Member of the Supervisory Board
of LocalTapiola General Mutual Insurance Company
• Member of the Board of Directors of Evli Bank Plc
since 2019
• Shareholding: 3,300 B shares
Robert Ingman, born 1961
M.Sc. (Tech.), M.Sc. (Econ. and Business
Administration)
• Chairman of the Boards of Directors of Ingman
Group Oy Ab, Ingman Finance Oy Ab, Ingman
Development Oy Ab, Digia Oyj, Etteplan Oy, Halti
Oy and Qt Group Ltd
• Member of the Board of Directors of Evli Bank
Plc since 2010
• Shareholding: 1,860,000 A shares and 652,000
B shares*
*Includes holdings of Ingman Group Oy Ab
Mikael Lilius, born 1949
B.Sc. (Econ. and Business Administration)
• Previously served as a Senior Advisor at Fortum
Corporation. President and CEO of Fortum Cor-
poration 2000-2009, and before this held various
supervisory positions in the industry sector
• Chairman of the Boards of Directors of Metso
Outotec Oyj
• Member of the Board of Directors of Evli Bank Plc
since 2010
• Shareholding: 40,760 B shares
Teuvo Salminen, born 1954
M.Sc. (Econ. and Business Administration)
• Various supervisory positions in Pöyry Plc 1985-
2009
• Chairman of the Board of Directors of Glaston Oyj
and T2H Oy, Member of the Boards of Directors of
Cargotec Oyj and 3Step It Group Oy
• Member of the Board of Directors of Evli Bank Plc
since 2010
• Shareholding: 70,000 B shares
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 147 | 149
Executive Group
Shareholdings on December 31, 2020
Maunu Lehtimäki, born 1967
M.Sc. (Econ.)
• Chief Executive Officer
• Joined Evli Bank Plc in 1996
• Shareholding: 533,728 A shares and 171,031 B
shares
Mari Etholén, born 1973
LLM
• Legal and human resources functions
• Joined Evli Bank Plc in 2001
• Shareholding: 60,000 A shares and 16,306 B shares
Panu Jousimies, born 1969
M.Sc. (Econ.)
• Execution and Operations unit
• Joined Evli Bank Plc in 1997
• Shareholding: 59,691 A shares and 114,249 B
shares
Juho Mikola, born 1981
M.Sc. (Econ.)
• Financial and Group administration, Deputy CEO
• Joined Evli Bank Plc in 2004
• Shareholding: 68,000 A shares and 32,787 B shares
Esa Pensala, born 1974
M.Sc. (Tech.)
• Private clients
• Joined Evli Bank Plc in 2001
• Shareholding: 142,000 A shares and 35,500 B
shares
Kim Pessala, born 1969
M.Sc. (Econ.)
• Institutional clients
• Joined Evli Bank Plc in 1995
• Shareholding: 12,331 A shares and 92,331 B shares
Mikael Thunved, born 1965
B.Sc. (Econ.)
• Corporate Finance business area
• Joined Evli Bank Plc in 2002
• Shareholding: Holdings through controlled com-
pany 95,000 B shares
GOVERNANCE
FINANCIAL REVIEW
RESPONSIBILITY BUSINESS OVERVIEW
ANNUAL REPORT 2020EVLI BANK PLC 148 | 149
Evli Pankki_WM (in Finnish)
Evli Research (in Finnish)
Evli Fund Management Company (in English)
Evli - Sijoittajan Pankki (in Finnish)
Evli Fund Management Company (in English)
Evli Research (in Finnish)
Evli Bank Plc (in Finnish)
Evli Fund Management Company (in English)
evlipankki (in Finnish)
www.evli.com
Evli Bank PlcIAleksanterinkatu 19 AIP.O. Box 1081IFI-00101 Helsinki, FinlandITel. +358 (0)9 476 690Iwww.evli.com