Review by the Supervisory Board










Reijo Karhinen, President and Group Executive Chairman, on his last day of work: "I am confident. The Group enjoys a new reform culture, exhibits willingness to see things in a new way – and shows strong financials."

Review by the Supervisory Board

Jaakko Pehkonen, Chair of the Supervisory Board, explains what OP's journey of change means and where we are heading.

Watch the video:

In 2017, OP continued its journey of transformation with customers at the core. We took several major steps forward in the implementation of our strategy that was published in 2016. The strong financial performance and capital adequacy made it possible to invest in service development as planned.

Reijo Karhinen, President and Group Executive Chairman, on his last day of work: "I am confident. The Group enjoys a new reform culture, exhibits willingness to see things in a new way – and shows strong financials."


Customers at the core

Our journey of change with customers at the core started as early as 1902, when the first cooperatives were established to provide services for their community. Since then the justification for our existence has been based on customer needs. We have implemented our mission by promoting the prosperity and wellbeing of our customers and our operating region.

The financial sector is undergoing a transformation where customers have more options, their expectations are changing and boundaries between industries are blurring. The change in customer behaviour that is underway guides OP Financial Group’s transformation. OP’s service packages under construction are a response to this change. Product and service ranges are being revamped and improved based on customer needs.

Investments in implementing the strategy

2017 was a good year in terms of financial performance, and as it met our expectations, it was possible to resource the transformation of our business operations. The implementation of our strategy proceeded as planned. We invested a record amount in the development of services, over 450 million euros. The majority of investments was targeted towards developing our traditional business operations. We launched several new products, both in traditional and new business lines. Our development work aims for a better customer experience, so we involved our customers in a more versatile, comprehensive manner in the development of services.

Our customer satisfaction and company image improved during 2017. The number of our owner-customers increased to over 1.8 million. The implementation of the efficiency-enhancement programme, as laid out in the strategy, did not entirely proceed according to the schedule, so the cost target of the programme was revised during 2017. Reaching our goal will still require active measures.

Changes in the operating environment and the substantial reinvention of our business require new competencies, while digitalisation and robotisation are transforming existing duties. In addition to developing systems, we are making heavy investments in modernising competencies. This modernisation is a challenge that not only applies to the financial sector but to society as a whole. We respond to this challenge with an operating model for competence reform, which we are building together with our personnel.

Economic growth as a source of delight

2017 brought with it an optimistic outlook and stronger, extensive growth in the Finnish economy. Exports picked up at a fast pace and companies increased their fixed investments, as consumer confidence boosted consumer spending. Favourable economic development is expected to continue, both in Finland and the rest of the euro area. In spite of increased economic activity, we must ensure the efficiency and cost-effectiveness of our functions now and in the coming years.

Common good

The year 2017 was also historical, because it was the centennial year of Finland’s independence. OP’s gift to the 100-year-old Finland – altogether 274 person years of volunteering together with personnel, customers, administration and partners – reflects our values and our mission as part of the Finnish society., a meeting place for volunteering, will continue to combine tasks and their performers this year too. We are active in promoting prosperity in our operating region, sense of community, responsibility and cooperation based on a people-first approach throughout Finland, through different actions and initiatives.

Boldly onwards together

OP’s strategy, published in 2016, is based on a future vision where the key driver of change is the change in customer behaviour that stems from digitalisation. In 2017 we updated this future vision and we are continuously monitoring the changes in customer behaviour and our operating environment.

We want to be a forerunner in our sector. For that we will need continuous and intense dialogue and co-operation with our customers, administration and personnel. Changes in the operating environment, competitive field and customer behaviour are also going to challenge us in the future. We need to make sure that we are heading in the right direction. At OP, customers lead the way, which means we are going to monitor our customers’ wishes even more closely. Our goal is to further improve customer experience and grow at above the market average rate.

During Executive Chairman Reijo Karhinen’s term of office, we took several bold steps of reinvention. In 2018 we will continue our journey of transformation, led by our new President and Group Executive Chairman Timo Ritakallio. It gives me great pleasure to thank our former President and Group Executive Chairman for his exceptionally extensive career for the benefit of OP and I wish the new Executive Chairman all the best and success – together with the entire OP Financial Group!

Jaakko Pehkonen
Supervisory Board Chair




2017 in brief




 Earnings before tax


million euros (-5.4%)





Loan portfolio growth


over the previous year





New OP bonuses accrued to owner-customers


million euros (+5.7%)

2017 in brief

This page shows OP Financial Group’s key figures and ratios for 2017 in summary.

Download OP Financial Group's Report by the Executive Board and Financial Statements 2017 here.

Information about non-financial indicators can be found under Corporate Social Responsibility and GRI.


Earnings before tax million euros (-5.4%)



Loan portfolio growth over the previous yea



New OP bonuses accrued to owner-customers million euros (+5.7%)


Earnings before tax over one billion euros for the third year in a row, strong growth in business

  • Earnings before tax amounted to 1,077 million euros (1,138), being 5% lower than the record earnings a year ago.
  • Income increased by a total of 4%. Net interest income increased by 3%, net commissions and fees by 8% and net investment income by 27%. Net insurance income decreased by 14%.
  • Expenses rose by 13%. The rise in expenses stemmed mainly from higher development investments related to the modernisation of the present-day business and from an increase in other expenses related to strategy implementation.
  • Impairment loss on receivables, 48 million euros (77), were low, accounting only for 0.06% of loans and receivables.
  • CET1 ratio was 20.1%, or at the previous year-end level.
  • Banking: The loan portfolio increased by 5% and deposits by 6%. Both net interest income and net commissions and fees increased by 4%. Supported by strong growth in income, earnings before tax increased by 16%.
  • Non-life insurance: Insurance premiums from private customers increased by 2%, while those from corporate customers decreased slightly. Earnings before tax decreased by 14%. The earnings were eroded by a reduction of the discount rate to 1.5% in September and more unfavourable claims development than a year ago.
  • Wealth Management: Assets under management increased by 5%. Earnings before tax increased by 9%, aided by strong improvement in net commissions and fees.
  • Other Operations: Earnings were weakened by higher investments in the development of services and other strategy implementation.
  • Earnings before tax for 2018 are expected to be at about the same level as or lower than in 2017.

Business development and sense of community for the benefit of owner-customers

  • In 2017, development investments worth around 450 million euros focused on ensuring compliance with requirements set by the authorities and legislative requirements, improving operational efficiency and smoothness as well as developing business.
  • In 2017, OP Financial Group opened Pohjola Hospitals in Oulu and Kuopio. The construction of a hospital in Turku is progressing as planned.
  • In the financial year, the number of OP cooperative banks’ owner-customers increased by 86,000 to over 1.8 million and that of OP Financial Group’s joint banking and insurance customers by 40,000 to almost 1.8 million.
  • In November, OP held the biggest electronic voting in Finland. Almost 2,400 owner-customers were elected to Representative Assemblies in 81 OP cooperative banks for the next four years.
  • OP Financial Group had the objective of donating 100 person-years of volunteering in honour of the centenary of Finland’s independence. Volunteer work performed with partners totalled 274 years.
  • OP bonuses increased by 6% to 220 million euros (208).



OP Financial Group’s key figures and ratios

  Q1–4/2017 Q1–4/2016 Change, %
EBT, € million 1,077 1,138 -5.4
Banking 666 574 16.0
Non-life Insurance 210 244 -13.9
Wealth Management 247 226 9.2
Other Operations -45 95  
New OP bonuses accrued to owner-customers 220 208 5.7
  31 Dec. 2017 31 Dec. 2016 Change, %
CET1 ratio, % 20.1 20.1 0.0*
Return on economic capital, % ** 21.3 22.7 -1.4*
Ratio of capital base to minimum amount of capital base (under the Act on the Supervision of Financial and Insurance Conglomerates), % *** 148 170 -22*
Ratio of impairment loss on receivables to loan and guarantee portfolio, % 0.06 0.09 0.0*
Owner-customers (1,000) 1,833 1,747 4.9

Comparatives deriving from the income statement are based on figures reported for the corresponding period in 2016. Unless otherwise specified, balance sheet and other cross-sectional figures on 31 December 2016 are used as comparatives
* Change in ratio
** 12-month rolling
*** The FiCo ratio has been calculated for insurance companies using transition provisions included in solvency regulation.









Redesign of OP eServices together with customers

First opened as a beta version to customers in autumn 2016, the redesigned OP eServices and online bank was then further developed based on customer feedback. In 2017, the new began providing banking and insurance services on a large scale for private and corporate customers. OP is among the rare financial industry players to have opened up an early beta access to its service. From the very beginning, OP has developed the new service together with its customers and is still collecting customer feedback that will guide further development.

Easier payments and more options

In April, we adopted the Siirto service developed by Automatia, jointly owned by Finnish banks. Siirto enables its user to make a real-time payment to a friend simply with a phone number. Online and mobile payments became easier with our Pivo app's new feature which enables the user to pay purchases conveniently with Pivo, without key codes. OP also developed and launched its first payment bots for Facebook Messenger.

OP’s Mobility Services diversify

OP Kulku, OP’s first mobility service launched in 2016, offers electric cars as a service. In 2017, OP also introduced DriveNow car sharing charged by the minute in Helsinki and OP Flexible Car providing rental cars for a month or a longer period offered nationwide. In May, OP also announced it will build with Fortum almost 100 charging stations in Finland.

Hiiop: OP Financial Group's gift to the 100-year-old Finland

To join Finland’s 100-year celebrations, OP Financial Group wanted to lower the threshold for participating in voluntary work. Inviting everyone in Finland to do voluntary work together, OP created a volunteer work exchange site at The website enables both announcing and searching for volunteer opportunities. During the jubilee year, OP Financial Group’s personnel and administration did over 274 person years of volunteering work together with partners and other people.

Pohjola Hospital network expands

In 2017, the Pohjola Hospital network was expanded by two new hospitals as the first Pohjola Hospital, located in Helsinki, and the Tampere hospital opened in 2016 were complemented by the Oulu hospital in May and the Kuopio hospital in August. All four Pohjola Hospitals provide basic healthcare and special healthcare services, examinations, surgery and rehabilitation on an extensive basis.

The biggest electronic voting in Finland

In November, OP Financial Group’s 81 cooperative banks held the election of the Representative Assemblies electronically, where owner-customers elected from among them the Representative Assembly for their own bank for four years. A total of almost 2,400 members were elected to the Assemblies. The number of candidates totalled over 5,600.

Motor Liability Insurance Act gives rise to a new type of motor liability insurance

Together with its customers, OP developed a new motor liability insurance offering the market’s highest initial bonus for new drivers, quicker bonus accumulation for drivers without claims, high maximum bonus and bonus cover for those driving a long time without claims. Already almost one-third of OP’s motor liability insurance policies, or over 250,000, are currently compliant with new legislation.

Strong IPO year

OP was involved in arranging initial public offerings of Finnish companies and was the only party to take part in all IPOs on the main list this year – Kamux, Silmäasema, Rovio and Terveystalo. In Finland, 2017 marks the best IPO year so far in terms of euros, as the total value of IPOs attained some 1.7 billion euros.

Success for OP’s first crowdfunding project

OP Crowdfunding’s first investment project involved the ice cream factory Suominen's Milk Ltd which sought capital for growth and to start exporting its organic ice cream, Jymy. The crowdfunding round was a success, as its minimum target of 200,000 euros was raised in two weeks and Jymy received the targeted number of new shareholders. The final amount raised was over 400,000 euros. OP's second crowdfunding project began in December, with the Nokia-based clothing manufacturer Papu Design, reaching the target already by the end of the year.

Updated CSR programme targets becoming carbon positive

OP's updated corporate social responsibility (CSR) programme sets ambitious targets for the future. One of them is to make OP carbon positive by 2025. The main themes of OP’s CSR programme are promoting sustainable economy, supporting regional vitality, people-first and participative approach and the promotion of health, safety and wellbeing.