95 Annual Information Business performance and financial position The Bank's commission business, and especially the securities business, delivered outstanding results in 2021. This business area delivered an increase of 32.0 percent compared to 2020. The volume of securities accounts the Bank manages for its clients increased to EUR 1,548.6 million (2020: EUR 1,466.8 million). Net income on fees and commissions increased by almost 17 percent to EUR 17.0 million (2020: EUR 14.6 million). Positive valuation effects relating to interest rate hedging transactions for fixed interest rate positions as well as to own issues increased the result from trading to EUR 9.9 million (2020: EUR -5.5 million). The result from financial investments deteriorated slightly to EUR -0.17 million (2020: EUR 0.16 million). Administrative expenses increased by 4.1 percent to EUR 57.6 million (2020: EUR 55.3 million). Personnel expenses, cost of materials and increased depreciation were responsible for the increases. Other operating expenses increased to EUR -7.6 million (2020: EUR -6.1 million) caused by the significantly higher cost of statutory contributions to the deposit guarantee schemes and resolution fund. This additional expense was partially offset by increased other operating income. HYPO Oberösterreich's cost-income ratio (CIR) improved significantly to 61.8 percent in 2021 (2020: 77.1 percent). This is found by dividing the administrative expenses by the total income, including other operating results. This resulted in an annual result before tax of EUR 32.5 million (2020: EUR 10.8 million). The result after tax increased to EUR 27.5 million (2020: EUR 9.3 million). The return on equity (ROE) thus improved to 6.8 percent in 2021 (2020: 2.3 percent). This is found by dividing the result before tax by the average equity. In the statement of comprehensive income, the other comprehensive income was affected primarily by valuation of the shareholdings in public limited companies. These must each be valued in the balance sheet at market value (e.g. share price) at year-end. HYPO Oberösterreich has indirect stakes of one percent in voestalpine AG and 0.5 percent in Austria Metall AG and Energie AG Oberösterreich. This has resulted in a positive contribution to the other comprehensive income of EUR 8.2 million in 2021 (2020: EUR 8.6 million). Contrasting with this, the interest rate increase at the end of 2021 devalued bonds in the own securities portfolio of EUR 6.7 million and the improvement of the own credit rating in all issuing categories led to a EUR 6.7 million valuation loss. The total comprehensive income for 2021 thus amounted to EUR 25.3 million (2020: EUR 15.3 million). Own equity Taking into account regulatory deductions, regulatory equity increased to EUR 542.7 million (2020: EUR 515.4 million). The increase is basically due to the good operating result. The major part after deduction of the distribution was allocated to retained earnings to strengthen equity. The prescribed growth rate in asset-side customer business in turn increased the total risk amount to EUR 3,348.0 million (2020: EUR 3,104.4 million). A total capital ratio of 16.2 percent (2020: 16.6 percent) was, however, nevertheless achieved. A similar picture emerges at the individual level of the institute. Eligible own funds could, on the one hand, be increased to EUR 440.1 million (2020: EUR 424.7 million) by allocation to retained earnings. On the other hand, however, the increase of regulatory assets to EUR 3,096.6 million (2020: EUR 2,871.9 million) correspondingly reduced the total capital ratio to 14.2 percent (2020: 14.8 percent). HYPO Oberösterreich, as at 31 December 2021, has an MREL (Minimum Requirement for Own Funds and Eligible Liabilities) surplus (TREA) of EUR 1,596.5 million (2020: EUR 1,689.2 million) with an MREL target (TREA) of EUR 560.6 million (2020: EUR 607.6 million).
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