Evli Bank Plc's Interim Report 1-3/2017 EVLI BA

EVLI BANK PLC STOCK EXCHANGE RELEASE APRIL 24, 2017, AT 12.15 PM

Evli Bank Plc's Interim Report 1-3/2017

Strong result for the year's first quarter

• Operating profit grew considerably in the Wealth Management and Investor Clients segment
• Earnings growth fell short of the target in the Advisory and Corporate Clients segment
• The income from trading activities increased more than anticipated in the Group Operations segment.

January-March 2017

• The Group's net revenue was EUR 16.1 million (1-3/2016: EUR 15.4 million)
• The Group's operating profit was EUR 4.6 million (EUR 3.1 million)
• The Group's profit was EUR 3.3 million (EUR 4.3 million). The profit in the comparison period was positively affected by Evli's share of the exit fees received by the associated company Northern Horizon Capital (EUR 1.9 million)
• Evli's diluted earnings per share were EUR 0.15 (EUR 0.17)
• Net assets under management grew year on year and totaled a record EUR 11.3 billion (EUR 9.5 billion) at the end of March.

Maunu Lehtimäki, CEO

During the first quarter, we launched a renewal of our organizational structure. The target of this renewal is to make Evli better suited to meet the evolving trends in the operating environment, the needs of clients and the changing regulation. As a consequence of the organizational change, Evli will have two business areas: Wealth Management and Investor Clients and Advisory and Corporate Clients. The business areas are supported by shared Group Operations, which consist of the bank operations and the investment activities through Evli's own balance sheet.

In the first quarter, our revenue increased four percent and our operating profit by 47 percent on the previous year. This earnings growth is mainly a result of the growth in client assets under management and an improvement in cost effectiveness. The ratio of our recurring revenues in relation to the Group's total costs continued to improve and reached a level of 112 percent. The expense/income ratio went down and was 0.72. The Group's return on equity was 20 percent.

The Wealth Management and Investor Client segment's revenue and operating result clearly improved on the previous year and client assets under management rose to EUR 11.3 billion. Net subscriptions to Evli's funds grew by close to EUR 500 million, and Evli Fund Management Company's market share increased to 6.4 percent of fund capital registered in Finland. The trend in our international fund sales was positive and foreign investors made up 18 percent of Evli's fund capital. The sales of private asset management services (institutional and Private Banking clients) also continued to do well, as in previous years, and in addition to the growth in assets under management the number of clients grew. Gross commissions from brokerage of equities and derivatives declined from the previous year, but sales revenue from structured investment products increased.

The Advisory and Corporate Clients segment's revenue declined 18 percent and operating result by 50 percent from the previous year. The decline was mainly due to a revenue decline in the Corporate Finance unit. Due to the income recognized in projects, significant fluctuations from one quarter to the next are typical for the Corporate Finance business. However, there was positive development in the unit's mandate base, which provides a good base for the coming quarters. The administration of incentive programs continued its steady performance. The sale of research services to listed companies that was launched last year started well and has been well received.

We still estimate that the result for 2017 will be clearly positive. This outlook is supported by the strong profit performance in the first quarter, the growth in client assets under management and the resulting improvement in the ratio of our recurring revenues in relation to the Group's total costs.

* Annualized **Dividend from 2016 approved by the Annual General Meeting. The dividend was paid on March 22, 2017. **Series A shares are valued at the closing value of the series B shares.

Outlook for 2017 updated

The stable performance of Evli's Wealth Management and Investor Clients business area is anticipated to continue. As a result, the proportion of recurring revenues to operating costs is expected to exceed the long-term target level of 100 percent. The mandate base of the Advisory and Corporate Clients business segment is good. However, substantial fluctuations in the annual return of the advisory business are possible. We estimate that the result for 2017 will be clearly positive.

Previously, it was estimated that the proportion of recurring revenues to operating costs would attain the long-term target level of 100 percent.

EVLI BANK PLC

For additional information, please contact:

Maunu Lehtimäki, CEO, tel. +358 (9) 4766 9304 or +358 (0)50 553 3000, maunu.lehtimaki@evli.com Juho Mikola, CFO, Evli Bank Plc, tel. +358 (0)9 4766 9871 or +358 (0)40 717 8888, juho.mikola@evli.com

Invitation to investor and analyst meeting

Maunu Lehtimäki, CEO, and Juho Mikola, CFO, will present the preliminary result to investors and analysts in Finnish on Tuesday, April 24, 2017 at 2.00 p.m. at Evli Bank, address Aleksanterinkatu 19 A, 4 fl, Helsinki. The presentation material will afterwards be available in English on Evli's website at www.evli.com > Investors

Evli Bank Plc in brief

Evli Bank Plc is a Finnish private bank specializing in investment. Evli's clients are present and future high net worth private individuals, companies, and institutions including insurance companies, pension funds, organizations and municipal authorities. Evli offers asset management services, various services related to the capital markets, alternative investment products, investment research, advisory services related to mergers and acquisitions as well as administration of incentive programs. The company also offers a comprehensive selection of funds, and banking services that support clients' investment activities.

Distribution: Nasdaq Helsinki Ltd, main media, www.evli.com

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