2005 was a period in which Tapiola established its banking operations, since it was the first full calendar year that Tapiola Bank was available to serve its customers.
Due to a tight market situation however, last year was challenging. Nevertheless, Tapiola Bank by and large reached its goals for 2005: the bank’s number of customers increased as planned so that at the end of the year there were about 49,000 customers. This was an outstanding example of the successful creation of an operating model and its related customer benefit scheme.
We did not participate in the loan fire sale
The procurement of deposits proceeded as planned, reaching the level of about EUR 300 million.
Credit demand was strong last year. However, the bank has avoided participating in any unhealthy collateral and price competition. Therefore lending growth came in a good 15% short of expectations.
Although the competitive situation in the markets is sometimes unhealthy and the level of interest rates is very low due to the international economic situation, our annual result for 2005 matched its budget.
During 2005, Tapiola Bank acquired a majority of shares in Tapiola Fund Management Company. The positive development of this subsidiary continued in line with the bank’s success, thanks to the growth in both the number of unit-holders and assets under management.
It is the overall cost that matters, not just the price on a loan
Tapiola Bank managed to promote to many reporters and consumer authorities the idea of weighing the total costs of a bank customer relationship instead of mere comparisons of loans.
From the point of view of the consumer, there has been a huge gap in this respect, since many customers have bought banking services without receiving information on what price they actually pay for them. At Tapiola Bank, customers are in fact encouraged to compare other factors in addition to the interest rates on loans. When services are assessed as a whole, Tapiola is the customer’s best choice.
Tapiola’s image and attractiveness as an insurance company also improved last year due to the very positive publicity created by the bank. The bank has received a lot of media attention, which has brought a real boost to its prestige.
Personnel have solid experience in banking
The recruitment of personnel has continued at the bank’s service centre and regional organisation. In addition to recruitment, extra efforts have been made in training. Almost the entire personnel of Tapiola Bank both in the head office and the regional offices have solid experience in banking.
Tapiola Bank customers have access to Internet services, a telephone service and all offices of the Tapiola Group. Our model, in which all services are provided through a single regional organisation and network, has proven its strength.
Cooperation between the bank and Tapiola’s regional organisation has been exemplary. Cooperation and sharing efforts make a difference, and that difference defines how our customers feel about Tapiola; all feedback indicates that they feel very good indeed. For this we owe thanks to everyone at Tapiola but we also owe a special thanks to our customers.
Targets for 2006 are challenging but realistic. The bank continues to focus on issues improving the quality of life our customers.
I am looking forward to the next year. We are on the winning team, and the results of our efforts will make a positive and significant change on the field of finance in the coming years!
Harri Lauslahti
Managing Director
Tapiola Bank Ltd