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OP-Asuntoluottopankki Oyj (70ZM)

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Wednesday 03 November, 2010

OP-Asuntoluottopankki Oyj

3rd Quarter Results






OP Mortgage Bank
Interim Report, January-September 2010
3 November 2010, 9.00 am Finnish time (GMT+2)

INTERIM REPORT JANUARY-SEPTEMBER 2010

OP Mortgage Bank's (OPA) loan portfolio decreased to EUR 4,213 million in the
January-September period (EUR 4,360 million at the end of 2009). OPA launched a
covered bond issue at a nominal valued of  EUR 1 billion in June. The covered
bond, issued in 2008 at a nominal value of
EUR 1 billion, matured and were paid off in June.

Earnings Development

+-----------------------------+----------+----------+-------+-------+------+
|EUR thousand                 |Q1-Q3/2010|Q1-Q3/2009|Q3/2010|Q3/2009|  2009|
+-----------------------------+----------+----------+-------+-------+------+
|                             |          |          |       |       |      |
+-----------------------------+----------+----------+-------+-------+------+
|Income                       |          |          |       |       |      |
+-----------------------------+----------+----------+-------+-------+------+
|Net interest income          |    11,773|     9,355|  3,730|  3,455|14,030|
+-----------------------------+----------+----------+-------+-------+------+
|Net commissions and fees     |    -6,394|    -5,843| -2,054| -1,893|-7,970|
+-----------------------------+----------+----------+-------+-------+------+
|Net income from trading      |        -1|         4|      0|      4|     0|
+-----------------------------+----------+----------+-------+-------+------+
|Net income from investments  |         1|         1|      0|      0|     1|
+-----------------------------+----------+----------+-------+-------+------+
|Other operating income       |         8|        26|      0|     23|    26|
+-----------------------------+----------+----------+-------+-------+------+
|Total                        |     5,387|     3,543|  1,676|  1,588| 6,086|
+-----------------------------+----------+----------+-------+-------+------+
|                             |          |          |       |       |      |
+-----------------------------+----------+----------+-------+-------+------+
|Expenses                     |          |          |       |       |      |
+-----------------------------+----------+----------+-------+-------+------+
|Personnel costs              |       222|       145|     62|     16|   297|
+-----------------------------+----------+----------+-------+-------+------+
|Other administrative expenses|     1,022|       608|    310|    188|   983|
+-----------------------------+----------+----------+-------+-------+------+
|Other operating expenses     |       974|       649|    396|    298|   864|
+-----------------------------+----------+----------+-------+-------+------+
|Total                        |     2,218|     1,402|    768|    502| 2,145|
+-----------------------------+----------+----------+-------+-------+------+
|                             |          |          |       |       |      |
+-----------------------------+----------+----------+-------+-------+------+
|Earnings before tax          |     3,169|     2,140|    908|  1,086| 3,941|
+-----------------------------+----------+----------+-------+-------+------+


The net interest income for January-September totalled EUR 11,773 thousand
(9,355)[1]. Earnings before tax amounted to EUR 3,169 thousand (2,140). Increase
in net interest income was due to the growth in the loan portfolio.

Net commissions and fees were negative with commission income increasing to EUR
2,011 thousand (1,170) and commission expenses to EUR 8,405 thousand (7,013).
 Commission expenses mainly comprise commissions paid to OP-Pohjola Group member
banks for servicing housing loans. The bank's expenses amounted to EUR 2,218
thousand (1,402). Growth in expenses derived largely from the ICT-services and
the professional services purchased in connection with the new covered bond
issue. OPA did not recognise any loan losses for the first nine months.

Net interest income for July-September grow to EUR 3,730 thousand (3,455) and
earnings before taxes to EUR 908 thousand (1,086). The bank's expenses grow to
EUR 768 thousand (502).

Balance Sheet and Off-balance Sheet Commitments

OPA's balance sheet total amounted to EUR 4,418 million on 30 September (EUR
4,555 million)[2].

Change in Major Asset and Liability Items

+-------------------+-----------+-----------+-----------+-----------+----------+
|                   |           |  30 June  | 31 March  |           |  30 Sep  |
|EUR Million        |30 Sep 2010|   2010    |   2010    |31 Dec 2009|   2009   |
+-------------------+-----------+-----------+-----------+-----------+----------+
|                   |           |           |           |           |          |
+-------------------+-----------+-----------+-----------+-----------+----------+
|Balance Sheet      |   4,418   |   4,624   |   4,450   |   4,555   |  2,862   |
+-------------------+-----------+-----------+-----------+-----------+----------+
|Receivables from   |   4,213   |   4,398   |   4,203   |   4,360   |  2,704   |
|customers          |           |           |           |           |          |
+-------------------+-----------+-----------+-----------+-----------+----------+
|Receivables from   |           |           |           |           |          |
|financial          |    48     |    89     |    56     |    55     |    33    |
|institutions       |           |           |           |           |          |
+-------------------+-----------+-----------+-----------+-----------+----------+
|Debt securities    |           |           |           |           |          |
|issued to the      |   3,330   |   3,332   |   3,336   |   3,311   |  2,087   |
|public             |           |           |           |           |          |
+-------------------+-----------+-----------+-----------+-----------+----------+
|Liabilities to     |           |           |           |           |          |
|financial          |    840    |   1,070   |    840    |   1,000   |   620    |
|institutions       |           |           |           |           |          |
+-------------------+-----------+-----------+-----------+-----------+----------+
|Shareholders'      |    143    |    142    |    141    |    140    |    89    |
|equity             |           |           |           |           |          |
+-------------------+-----------+-----------+-----------+-----------+----------+
|Off-balance sheet  |     9     |    10     |    12     |    15     |    19    |
|commitments        |           |           |           |           |          |
+-------------------+-----------+-----------+-----------+-----------+----------+

The loan portfolio decreased from EUR 4,360 million on 31 December 2009 to EUR
4,213 million on 30 September 2010 since the amount of new housing loans granted
directly from OPA's balance sheet to customers was lower than the total amount
of repaid loans. OPA increased its loan portfolio in the review period when it
purchased housing loans from OP-Pohjola-Group member banks for EUR 398 million.

On 30 September, households accounted for 99 % (99) of the loan portfolio and
housing corporations for 1 % (1). The bank's non-performing loans amounted to
EUR 0,8 million (0,8).
No impairment losses on loans were recognised.

The carrying amount of bonds issued to the public totalled EUR 3,330 million
(2,091) on 30 September. OPA issued its fourth covered bond at a nominal value
of EUR 1 billion on international capital markets in June. Moody's Investor
Services and Standard & Poor's Rating Services have given the bond their highest
credit ratings of Aaa and AAA. The covered bond, issued in 2008 at a nominal
value of EUR 1 billion, matured and were paid off in June. In addition to bonds,
other funding was based on financing loans granted by Pohjola Bank plc
(Pohjola). On 30 September, financing loans totalled EUR 840 million (1,000).

Shareholders' equity rose to EUR 142,6 million (140,2). Retained earnings
amounted to
EUR 12,6 million (10,2) at the end of the review period.

OPA has hedged against the interest-rate risk associated with its housing loan
portfolio through interest-rate swaps, i.e. base rate cash flows from housing
loans to be hedged are swapped to short-term Euribor cash flows. OPA has also
swapped the fixed interest rates of the bonds it has issued to short-term
variable rates. OPA's interest-rate derivative portfolio totalled EUR 8,716
million (7,832). All derivative contracts have been concluded for hedging
purposes. Pohjola is the counterparty to all derivative contracts.

Development of Capital Adequacy

OPA's capital adequacy ratio stood at 10,4 % on 30 September. Since the
beginning of 2008, OPA has calculated its capital adequacy in compliance with
Basel II.  Credit risk is calculated according to the standardised approach and
the capital requirement for operational risk is calculated using the basic
approach.


+--------------+-----------+-----------+---------------+--------------+--------+
|OWN FUNDS, EUR|           |           |           31  |          31  |        |
|thousand      |           |  30 June  |     March     |     Dec      | 30 Sep |
|              |30 Sep 2010|   2010    |          2010 |         2009 |  2009  |
+--------------+-----------+-----------+---------------+--------------+--------+
|  Tier I      |    141,513|    140,764|        140,057|       139,067|  87,644|
+--------------+-----------+-----------+---------------+--------------+--------+
|       of     |           |           |               |              |        |
|which capital |           |           |               |              |        |
|loans         |           |           |               |              |        |
+--------------+-----------+-----------+---------------+--------------+--------+
|  Tier II     |     20,000|     20,000|         20,000|        20,000|  20,000|
+--------------+-----------+-----------+---------------+--------------+--------+
|  Decreases   |           |           |               |              |        |
+--------------+-----------+-----------+---------------+--------------+--------+
|Total         |    161,513|    160,764|        160,057|       159,067| 107,644|
+--------------+-----------+-----------+---------------+--------------+--------+
|              |           |           |               |              |        |
+--------------+-----------+-----------+---------------+--------------+--------+
|Risk-weighted |           |           |               |              |        |
|receivables,  |           |           |               |              |        |
|investments   |           |           |               |              |        |
|and off-      |           |           |               |              |        |
|balance sheet |           |           |               |              |        |
|commitments   |  1,556,949|  1,627,208|      1,562,989|     1,622,243| 996,072|
+--------------+-----------+-----------+---------------+--------------+--------+
|              |           |           |               |              |        |
+--------------+-----------+-----------+---------------+--------------+--------+
|Capital       |           |           |               |              |        |
|adequacy      |           |           |               |              |        |
|ratio, %      |       10.4|        9.9|           10.2|           9.8|    10,8|
+--------------+-----------+-----------+---------------+--------------+--------+
|              |           |           |               |              |        |
+--------------+-----------+-----------+---------------+--------------+--------+
|Tier I ratio  |           |           |               |              |        |
|to risk-      |           |           |               |              |        |
|weighted      |           |           |               |              |        |
|receivables,  |           |           |               |              |        |
|investments   |           |           |               |              |        |
|and off-      |           |           |               |              |        |
|balance sheet |           |           |               |              |        |
|commitments   |        9.1|        8.7|            9.0|           8.6|     8,8|
+--------------+-----------+-----------+---------------+--------------+--------+


The increase in shareholders' equity arising from the measurement of pension
liabilities and the assets covering them, under IFRS, is not considered own
funds. Furthermore, intangible assets was also deducted from own funds.

+-----------------+-----------+------------+-------------+---------+-----------+
|Risk-weighted    |           |            |             |         |           |
|receivables,     |           |            |             |         |           |
|investments and  |           |            |             |         |           |
|off balance-sheet|           |            |             |         |           |
|commitments,  EUR|           |            |             | 31 Dec  |           |
|thousand         |30 Sep 2010|30 June 2010|31 March 2010|  2009   |30 Sep 2009|
+-----------------+-----------+------------+-------------+---------+-----------+
|                 |           |            |             |         |           |
+-----------------+-----------+------------+-------------+---------+-----------+
| Receivables and |           |            |             |         |           |
|investments      |  1,543,476|   1,613,851|    1,548,950|1,610,079|    982,338|
+-----------------+-----------+------------+-------------+---------+-----------+
|  Off-balance-   |           |            |             |         |           |
|sheet items      |      2,621|       2,505|        3,187|    4,039|      5,609|
+-----------------+-----------+------------+-------------+---------+-----------+
| Market risk     |          -|           -|            -|        -|          -|
+-----------------+-----------+------------+-------------+---------+-----------+
| Operational     |           |            |             |         |           |
|risks            |     10,852|      10,852|       10,852|    8,125|      8,125|
+-----------------+-----------+------------+-------------+---------+-----------+
|Risk-weighted    |           |            |             |         |           |
|receivables,     |           |            |             |         |           |
|investments and  |  1,556,949|            |             |         |           |
|off balance-sheet|           |            |             |         |           |
|commitments,     |           |            |             |         |           |
|total            |           |   1,627,208|    1,562,989|1,622,243|    996,072|
+-----------------+-----------+------------+-------------+---------+-----------+


The decrease in the amount of risk-weighted receivables was due to an decreased
loan portfolio.

Joint Responsibility and Joint Security

Under the Act on Cooperative Banks and Other Cooperative Credit Institutions,
the

amalgamation of the cooperative banks comprises the organisation's central
institution

(OP-Pohjola Group Central Cooperative), the Central Cooperative's member credit

institutions and the companies belonging to their consolidation groups. This

amalgamation is monitored on a consolidated basis. The Central Cooperative and
its

member banks are ultimately responsible for each other's liabilities and
commitments.






The Central Cooperative's members at the end of the report period comprised
             OP-Pohjola Group's 218 member banks as well as Pohjola Bank plc,
Helsinki OP Bank Plc, OP Mortgage Bank and OP-Kotipankki Oyj. OP-Pohjola Group's
insurance companies do not fall within the scope of joint responsibility.


Inspite of the joint responsibility and the joint security, pursuant to Section
17 of the Act on Mortgage Credit Banks, the holder of a bond with mortgage
collateral shall, notwithstanding the liquidation or bankruptcy of a mortgage
credit bank, have the right to receive payment, before other claims, for the
entire loan period of the bond, in accordance with the contract terms, from the
funds entered as collateral for the bond.

Personnel

On 30 September, OPA had five employees.  It purchases all key support services
from Central Cooperative and its Group companies, which reduces the need for
more staff.

Administration

The General Meeting held in August confirmed the composition of the new Board of
Directors. Mr. Harri Luhtala, Chief Financial Officer, OP-Pohjola Group Central
Cooperative was elected as a new member of the Board of Directors and Mr. Harri
Nummela was left out of the Board of Directors. The Board composition is as
follows:

Chairman   Harri Luhtala  Chief Financial Officer, OP-Pohjola      Group Central
Cooperative
Vice Chairman   Mikko Hyttinen   Senior Vice President, OP-Pohjola Group
       Central Cooperative
Members   Sakari Haapakoski   Bank Manager, Oulun Osuuspankki
   Jari Himanen   Managing Director, Etelä-Karjalan Osuuspankki
                   Hanno Hirvinen   Executive Vice President, Pohjola Bank plc
                        Heikki Kananen                        Managing Director,
Mäntsälän Osuuspankki
                        Matti Nykänen              Senior Vice President, OP-
Pohjola Group                                                         Central
Cooperative
                   Mikko Rosenlund   Managing Director, Tampereen Seudun
    Osuuspankki


Managing Director       Lauri Iloniemi.


Events after the review period

Shareholders' equity increased by EUR 15 million after OP-Pohjola Group Central
Cooperative made an additional investment in the company.

OPA increased its loan portfolio after the review period when it purchased
housing loans from OP-Pohjola Group member banks for EUR 1,015 million.

Prospects for the rest of the year

The overall quality of OPA's credit portfolio is expected to remain strong.
Earnings before tax in 2010 are expected to equal or exceed the 2009 figure.


Income Statement

+-----------------------------+----------+----------+-------+-------+------+
|EUR thousand                 |Q1-Q3/2010|Q1-Q3/2009|Q3/2010|Q3/2009|  2009|
+-----------------------------+----------+----------+-------+-------+------+
|                             |          |          |       |       |      |
+-----------------------------+----------+----------+-------+-------+------+
|Interest income              |    43,907|    54,924| 15,736| 11,332|68,928|
+-----------------------------+----------+----------+-------+-------+------+
|Interest expenses            |    32,134|    45,568| 12,006|  7,877|54,899|
+-----------------------------+----------+----------+-------+-------+------+
|Net interest income          |    11,773|     9,355|  3,730|  3,455|14,030|
+-----------------------------+----------+----------+-------+-------+------+
|Net commissions and fees     |    -6,394|    -5,843| -2,054| -1,893|-7,970|
+-----------------------------+----------+----------+-------+-------+------+
|Net income from trading      |        -1|         4|      0|      4|     0|
+-----------------------------+----------+----------+-------+-------+------+
|Net income from investments  |         1|         1|      0|      0|     1|
+-----------------------------+----------+----------+-------+-------+------+
|Other operating income       |         8|        26|      0|     23|    26|
+-----------------------------+----------+----------+-------+-------+------+
|Personnel costs              |       222|       145|     62|     16|   297|
+-----------------------------+----------+----------+-------+-------+------+
|Other administrative expenses|     1,022|       608|    310|    188|   983|
+-----------------------------+----------+----------+-------+-------+------+
|Other operative expenses     |       974|       650|    396|    298|   864|
+-----------------------------+----------+----------+-------+-------+------+
|Earnings before tax          |     3,169|     2,140|    908|  1,086| 3,941|
+-----------------------------+----------+----------+-------+-------+------+
|Income taxes                 |       759|       549|    170|    284| 1,017|
+-----------------------------+----------+----------+-------+-------+------+
|Profit for the period        |     2,410|     1,591|    739|    802| 2,924|
+-----------------------------+----------+----------+-------+-------+------+


Key Ratios

+-------------------------+----------+----------+-------+-------+----+
|                         |Q1-Q3/2010|Q1-Q3/2009|Q3/2010|Q3/2009|2009|
+-------------------------+----------+----------+-------+-------+----+
|Return on equity (ROE), %|       2.3|       2,4|    2.1|    3,7| 2.6|
+-------------------------+----------+----------+-------+-------+----+
|Cost/income ratio, %     |        41|        40|     46|     32|  35|
+-------------------------+----------+----------+-------+-------+----+


Calculation of key ratios

Return on equity, % = Annualised profit for the period / Equity capital (average
equity capital at the beginning and end of the period) × 100

Cost/income ratio, % = Personnel costs + Other administrative expenses + Other
operating expenses / Net interest income + Net commission income + Net income
from trading + Total net income from investments + Other operating income × 100


Balance Sheet
+-----------------+---------+------------+-------------+-----------+-----------+
|                 |   30 Sep|            |             |           |           |
|EUR thousand     |     2010|30 June 2010|31 March 2010|31 Dec 2009|30 Sep 2009|
+-----------------+---------+------------+-------------+-----------+-----------+
|                 |         |            |             |           |           |
+-----------------+---------+------------+-------------+-----------+-----------+
|Receivables from |         |            |             |           |           |
|financial        |         |            |             |           |           |
|institutions     |   48,373|      88,815|       56,093|     55,017|     33,000|
+-----------------+---------+------------+-------------+-----------+-----------+
|Derivative       |         |            |             |           |           |
|contracts        |   95,897|     103,945|       94,378|     75,934|     89,753|
+-----------------+---------+------------+-------------+-----------+-----------+
|Receivables from |         |            |             |           |           |
|customers        |4,212,596|   4,398,089|    4,202,733|  4,360,036|  2,703,595|
+-----------------+---------+------------+-------------+-----------+-----------+
|Investments      |         |            |             |           |           |
|assets           |       17|          17|           17|         17|         17|
+-----------------+---------+------------+-------------+-----------+-----------+
|Intangible assets|      954|         942|          886|        942|        975|
+-----------------+---------+------------+-------------+-----------+-----------+
|Tangible assets  |        4|           4|            5|          5|          1|
+-----------------+---------+------------+-------------+-----------+-----------+
|Other assets     |   59,985|      32,441|       95,524|     63,177|     34,144|
+-----------------+---------+------------+-------------+-----------+-----------+
|Tax receivables  |         |            |             |           |         33|
+-----------------+---------+------------+-------------+-----------+-----------+
|Total assets     |4,417,826|   4,624,252|    4,449,634|  4,555,128|  2,861,519|
+-----------------+---------+------------+-------------+-----------+-----------+
|                 |         |            |             |           |           |
+-----------------+---------+------------+-------------+-----------+-----------+
|Liabilities to   |         |            |             |           |           |
|financial        |         |            |             |           |           |
|institutions     |  840,000|   1,070,000|      840,000|  1,000,000|    620,000|
+-----------------+---------+------------+-------------+-----------+-----------+
|Derivative       |         |            |             |           |           |
|contracts        |    5,417|      12,012|        5,756|     11,971|      5,843|
+-----------------+---------+------------+-------------+-----------+-----------+
|Debt securities  |         |            |             |           |           |
|issued to the    |         |            |             |           |           |
|public           |3,329,640|   3,331,736|    3,336,060|  3,310,811|  2,087,102|
+-----------------+---------+------------+-------------+-----------+-----------+
|Reserves and     |         |            |             |           |           |
|other liabilities|   80,000|      48,390|      106,233|     71,727|     39,526|
+-----------------+---------+------------+-------------+-----------+-----------+
|Tax liabilities  |      135|         219|          450|        395|        156|
+-----------------+---------+------------+-------------+-----------+-----------+
|Subordinated debt|         |            |             |           |           |
|securities       |   20,000|      20,000|       20,000|     20,000|     20,000|
+-----------------+---------+------------+-------------+-----------+-----------+
|Total liabilities|4,275,192|   4,482,356|    4,308,500|  4,414,904|  2,772,627|
+-----------------+---------+------------+-------------+-----------+-----------+
|Shareholders'    |         |            |             |           |           |
|equity           |         |            |             |           |           |
+-----------------+---------+------------+-------------+-----------+-----------+
|  Share capital  |   60,000|      60,000|       60,000|     60,000|     60,000|
+-----------------+---------+------------+-------------+-----------+-----------+
|  Reserve for    |         |            |             |           |           |
|invested         |         |            |             |           |           |
|unrestricted     |         |            |             |           |           |
|      . equity   |   70,000|      70,000|       70,000|     70,000|     20,000|
+-----------------+---------+------------+-------------+-----------+-----------+
|  Retained       |         |            |             |           |           |
|earnings         |   12,635|      11,896|       11,135|     10,224|      8,892|
+-----------------+---------+------------+-------------+-----------+-----------+
|Total equity     |  142,635|     141,896|      141,135|    140,224|     88,892|
+-----------------+---------+------------+-------------+-----------+-----------+
|Total liabilities|         |            |             |           |           |
|and shareholders'|         |            |             |           |           |
|equity           |4,417,826|   4,624,252|    4,449,634|  4,555,128|  2,861,519|
+-----------------+---------+------------+-------------+-----------+-----------+

Off-balance Sheet Commitments
+--------------------+-----------+------------+-------------+-----------+------+
|                    |           |            |             |           |30 Sep|
|EUR thousand        |30 Sep 2010|30 June 2010|31 March 2010|31 Dec 2009|  2009|
+--------------------+-----------+------------+-------------+-----------+------+
|Binding credit      |           |            |             |           |      |
|commitments         |      8,820|       9,939|       12,245|     15,108|17,949|
+--------------------+-----------+------------+-------------+-----------+------+

Statement of Changes in Equity

+--------------------+-------------+--------------+---------------+------------+
|                    |             |Other reserves|       Retained|            |
|EUR thousand        |Share capital|              |       earnings|Total equity|
+--------------------+-------------+--------------+---------------+------------+
|Shareholders' equity|             |              |               |            |
|1 Jan 2009          |       60,000|        20,000|          7,317|      87,317|
+--------------------+-------------+--------------+---------------+------------+
|Reserve for invested|             |              |               |            |
|unrestricted  equity|            -|             -|              -|           -|
+--------------------+-------------+--------------+---------------+------------+
|Profit for the      |             |              |               |            |
|period              |            -|             -|          1,591|       1,591|
+--------------------+-------------+--------------+---------------+------------+
|Other changes       |            -|             -|            -16|         -16|
+--------------------+-------------+--------------+---------------+------------+
|Shareholders' equity|             |              |               |            |
|30 Sep 2009         |       60,000|        20,000|          8,892|      88,892|
+--------------------+-------------+--------------+---------------+------------+
|                    |             |              |               |            |
+--------------------+-------------+--------------+---------------+------------+
|                    |             |              |Retained       |            |
|EUR thousand        |Share capital|Other reserves|earnings       |Total equity|
+--------------------+-------------+--------------+---------------+------------+
|Shareholders' equity|             |              |               |            |
|1 Jan 2010          |       60,000|        70,000|         10,224|     140,224|
+--------------------+-------------+--------------+---------------+------------+
|Reserve for invested|             |              |               |            |
|unrestricted equity |            -|             -|              -|           -|
+--------------------+-------------+--------------+---------------+------------+
|Profit for the      |             |              |               |            |
|period              |            -|             -|          2,410|       2,410|
+--------------------+-------------+--------------+---------------+------------+
|Other changes       |            -|             -|              -|           -|
+--------------------+-------------+--------------+---------------+------------+
|Shareholders' equity|             |              |               |            |
|30 Sep 2010         |       60,000|        70,000|         12,635|     142,635|
+--------------------+-------------+--------------+---------------+------------+

Cash Flow Statement

+----------------------------+-----------+-----------+
| EUR thousand               | Q1-3/2010 | Q1-3/2009 |
+----------------------------+-----------+-----------+
|                            |           |           |
+----------------------------+-----------+-----------+
| Liquid assets 1 January    |    41,129 |    18,380 |
+----------------------------+-----------+-----------+
| Cash flow from operations  |    13,030 |    16,147 |
+----------------------------+-----------+-----------+
| Cash flow from investments |      -216 |      -423 |
+----------------------------+-----------+-----------+
| Cash flow from financing   |    -5,570 |   -14,991 |
+----------------------------+-----------+-----------+
| Liquid assets 30 September |    48,373 |    19,113 |
+----------------------------+-----------+-----------+

The cash flow statement presents the cash flows for the period on the cash
basis, divided into cash flows from operations, investments and financing. Cash
flows from operations includes the cash flows generated from day-to-day
operations. Cash flow from investments includes payments related to tangible and
intangible assets, investments held to maturity and shares that are not
considered as belonging to cash flow from operations. Cash flow from financing
includes cash flows originating in the financing of operations either on equity
or liability terms from money or capital market. Liquid assets include cash in
hand and receivables from financial institutions payable on demand.  The
statement has been prepared using the indirect method.

+---------------------------------------------------+----------------+---------+
|Fair values of financial assets and liabilities    |                |         |
+-----------------+-----------------+---------------+----------------+---------+
|                 |                 |  Recognised at|                |         |
|                 |                 |     fair value|                |         |
|                 |        Loans and| through profit|   Available for|         |
|EUR 1,000        |      receivables|        or loss|            sale|    Total|
+-----------------+-----------------+---------------+----------------+---------+
|                 |                 |               |                          |
+-----------------+-----------------+---------------+--------------------------+
|Financial assets |                 |               |                          |
+-----------------+-----------------+---------------+----------------+---------+
|Receivables from |                 |               |                |         |
|financial        |                 |               |                |         |
|institutions     |           48,373|              -|               -|   48,373|
+-----------------+-----------------+---------------+----------------+---------+
|Derivative       |                 |               |                |         |
|contracts        |                -|         95,897|               -|   95,897|
+-----------------+-----------------+---------------+----------------+---------+
|Receivables from |                 |               |                |         |
|customers        |        4,212,596|               |                |4,212,596|
+-----------------+-----------------+---------------+----------------+---------+
|Equities         |                -|              -|              17|       17|
+-----------------+-----------------+---------------+----------------+---------+
|Other receivables|           59,985|              -|               -|   59,985|
+-----------------+-----------------+---------------+----------------+---------+
|Balance at 30    |                 |               |                |         |
|September 2010   |        4,320,954|         95,897|              17|4,416,868|
+-----------------+-----------------+---------------+----------------+---------+
|Balance at 30    |                 |               |                |         |
|September 2009   |        2,771,749|         89,753|              17|2,861,519|
+-----------------+-----------------+---------------+----------------+---------+
|Balance at 31    |                 |               |                |         |
|December 2009    |        4,478,235|         75,934|              17|4,554,186|
+-----------------+-----------------+---------------+----------------+---------+
|                 |                 |               |                          |
+-----------------+-----------------+---------------+----------------+---------+
|                 |                 |  Recognised at|                |         |
|                 |                 |     fair value|                |         |
|                 |                 | through profit|           Other|         |
|EUR 1,000        |                 |        or loss|     liabilities|    Total|
+-----------------+-----------------+---------------+----------------+---------+
|Liabilities to   |                 |               |                |         |
|financial        |                 |               |                |         |
|institutions     |                -|              -|         840,000|  840,000|
+-----------------+-----------------+---------------+----------------+---------+
|Derivative       |                 |               |                |         |
|contracts        |                -|          5,417|               -|    5,417|
+-----------------+-----------------+---------------+----------------+---------+
|Debt securities  |                 |               |                |         |
|issued to the    |                 |               |                |         |
|public           |                -|              -|       3,329,640|3,329,640|
+-----------------+-----------------+---------------+----------------+---------+
|Subordinated     |                 |               |                |         |
|liabilities      |                -|              -|          20,000|   20,000|
+-----------------+-----------------+---------------+----------------+---------+
|Other liabilities|                -|              -|          80,135|   80,135|
+-----------------+-----------------+---------------+----------------+---------+
|Balance at 30    |                 |               |                |         |
|September 2010   |                -|          5,417|       4,269,775|4,275,192|
+-----------------+-----------------+---------------+----------------+---------+
|Balance at 30    |                 |               |                |         |
|September 2009   |                -|          5,843|       2,766,784|2,772,627|
+-----------------+-----------------+---------------+----------------+---------+
|Balance at 31    |                 |               |                |         |
|December 2009    |                -|         11,971|       4,402,933|4,414,904|
+-----------------+-----------------+---------------+----------------+---------+

Debt securities issued to the public are carried at amortised cost.  On 30
September 2010, the fair value of these debt instruments was approximately EUR
97,784 thousand higher than their carrying amount, based on information
available in markets and employing commonly used valuation techniques.
Subordinated liabilities are carried at amortised cost. Their  fair value are
substantially lower than their carrying amount, but determining fair values
realiably is difficult in the current market situation.

Derivative Contracts 30.9.2010

+-------------+-----------------------------------+------------------+---------+
|             |Nominal values/the remaining       |   Fair values    |         |
|EUR thousand |maturity                           |                  |         |
+-------------+--------+---------+------+---------+------+-----------+         |
|             |        |         |  More|         |      |           |         |
|             |    Less|         |  than|         |      |           | Credit  |
|             | than 1 |         |    5 |         |      |           |counter- |
|             |    year|1-5 years| years|    Total|Assets|Liabilities|  value  |
+-------------+--------+---------+------+---------+------+-----------+---------+
|Interest rate|        |         |      |         |      |           |         |
|derivatives  |        |         |      |         |      |           |         |
+-------------+--------+---------+------+---------+------+-----------+---------+
|  Hedging    | 256,249|8,459,739|     0|8,715,988|95,897|      5,417|  184,338|
+-------------+--------+---------+------+---------+------+-----------+---------+
|  Trading    |        |         |      |        -|      |           |         |
+-------------+--------+---------+------+---------+------+-----------+---------+
|Total        | 256,249|8,459,739|     0|8,715,988|95,897|      5,417|  184,338|
+-------------+--------+---------+------+---------+------+-----------+---------+


Derivative Contracts 30.9.2009

+------------+-------------------------------------+------------------+--------+
|EUR thousand|Nominal values/the remaining maturity|   Fair values    |        |
+------------+----------+---------+------+---------+------+-----------+        |
|            |          |         |  More|         |      |           |        |
|            |          |         |  than|         |      |           | Credit |
|            | Less than|         |    5 |         |      |           |counter-|
|            |    1 year|1-5 years| years|    Total|Assets|Liabilities| value  |
+------------+----------+---------+------+---------+------+-----------+--------+
|Interest    |          |         |      |         |      |           |        |
|rate        |          |         |      |         |      |           |        |
|derivatives |          |         |      |         |      |           |        |
+------------+----------+---------+------+---------+------+-----------+--------+
|  Hedging   | 2,005,720|2,697,887|     0|4,703,607|89,753|      5,843| 128,138|
+------------+----------+---------+------+---------+------+-----------+--------+
|  Trading   |          |         |      |        -|      |           |        |
+------------+----------+---------+------+---------+------+-----------+--------+
|Total       | 2,005,720|2,697,887|     0|4,703,607|89,753|      5,843| 128,138|
+------------+----------+---------+------+---------+------+-----------+--------+


All derivative contracts have been entered into for hedging purposes, regardless
of their classification in accounting.

Related-party transactions

OPA's related parties include OP-Pohjola Group Central Cooperative and its
subsidiaries,  the OP-Pohjola Group pension insurance organisations OP-Pension
Fund and OP-Pension Foundation, and the company's administrative personnel.
Standard terms and conditions for credit are applied to loans granted to the
related parties. Loans are tied to generally used reference rates. Related-party
transactions have not undergone any substantial changes since 31 December 2009.

The Interim Report for 1 January - 30 September 2010 has been prepared in
accordance with IAS 34 (Interim Financial Reporting), as approved by the EU.
 The Financial Statements 2009 contain a description of the accounting policies
applied. This Interim Report is based on unaudited figures. Given that all
figures have been rounded off, the sum total of individual figures may deviate
from the presented sums.

The interim report is unaudited.

Helsinki, 3 November 2010

OP Mortgage Bank
Board of Directors


For further information, please contact Mr Lauri Iloniemi, Managing Director,
tel. +358 10 252 3541


[HUG#1458367]








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