Fitch Affirms Ratings For Finland's OKO Bank.

Business Editors

BARCELONA, Spain & LONDON--(BUSINESS WIRE)--May 22, 2003

Fitch Ratings, the international rating agency, has affirmed the ratings of Ossuspankkien Keskuspankki (OKO Bank) at long-term 'AA-' ('AA minus'), short-term 'F1+', individual 'B' and support of '2'. The Rating Outlook remains Stable.

The ratings reflect OKO Bank's improved financial fundamentals in recent years and its membership of the OKO Bank Group (OKO Group), Finland's second largest banking group, which enjoys a strong domestic retail franchise and capitalisation, healthy asset quality and sound profitability. Although the ratings apply to OKO Bank, a commercial bank in its own right as well as the group's central bank and service provider, Fitch's analysis is mainly based on OKO Group's accounts, given that supervision of capital adequacy, liquidity and risk concentration is at consolidated level.

OKO Group is based on a strong mutual support principle, established in 1997 following the restructuring of Finland's co-operative banking sector. OKO Group has since upgraded and centralised its credit risk management and monitoring systems. Coupled with Finland's sound economy -- although it has weakened in recent years -- this resulted in healthy asset quality, reflected in a net impaired loans/total loans ratio of 0.71% at end-2002. The group's profitability is sound, based on a relatively ample but declining net interest margin, supported by consistent robust growth in lending (which accounts for about 78% of the group's assets, reflecting its retail nature) and good progress in core banking revenue generation and cost control. Cost efficiency (below 60% at end-2002) benefited from customers' increasing use of more cost-efficient electronic distribution channels. Liquidity is sound and OKO Group's Basle total capital/weighted risks ratio was 15.2% at end-2002, which is strong.

OKO Group comprises the OGCC, which controls OKO Bank and its subsidiaries; the group's mutual fund management and telebanking subsidiaries; OKO Bank Group Mutual Insurance Company (OGMI); OKO Bank Group Security Fund (OGSF; to be wound up by 2004); OKO Bank Group Mortgage Bank (OGMB); and 243 individual co-operative banks. OKO Bank also undertakes some international business on behalf of the co-operative banks. OKO Bank, together with its subsidiaries, accounted for 40% of total group assets at end-2002. The group's strategy is to grow core business volumes and strengthen its market position (market shares of euro loans and deposits at end-2002 were 31.4% and 32.7% respectively), aided by an enhanced product range, better distribution, and cross-selling opportunities from strategic alliances.

Notes to Editors: Fitch's Support and Individual Ratings for Banks

Fitch's Individual ratings assess how a bank would be viewed if it were entirely independent and could not rely on external support. Its Support ratings deal with the question of whether a bank would receive support from its owners or from the state if it were to get into difficulty. These ratings are not debt ratings but rather, respectively, an assessment of the intrinsic strength of a bank and of any level of outside support that may, or may not, be available to it.