Komplett Bank annual report 2019

Note 21 Events after the reporting period The Board is not aware of events after the balance sheet date that are of material importance to the annual financial statements. Note 22 Alternative performance measures Alternative performance measures are often used by investors, financial analysts and others for decision-making purposes by contribut- ing to a deeper insight into the operational and financial aspects of a company. Alternative performance measures can provide reinforc- ing information on the company’s historical and present situation, and the company’s future prospects. The Bank has defined “return on equity” (ROE), cost percentage and loss ratio as the company’s alternative performance measures and these are presented in the Report from the Board of Directors. All the alternative performance measures refer to events that have occurred and are recognised in the Bank’s annual financial statements. Return on equity (ROE) is defined as the annual profit/average quarterly equity expressed as a percentage. This is one of the company’s most important target figures and provides information on the Bank’s ability to generate a surplus from the shareholders’ investments. The cost percentage is defined as the total operating expenses, excluding marketing costs and losses on loans/net interest income and net commissions and fees. The target figure is presented to give investors, financial analysts and others an insight into how the costs correlate to revenues and to give users of the financial reporting information on developments in the Bank’s operational effectiveness. Loss ratio is defined as losses on loans/average yearly net loans in percent. Losses on loans is among the most significant elements in the profit and loss statement. The development in loss ratio is an important key measure amongst investors, financial analytics and other to assess the be able to assess the underlying credit risk in the Bank’s loans to customers. Adjusted return on equity is defined as adjusted profit after tax/average yearly adjusted equity net of tier 1 capital. The adjusted one-offs relates to losses on loans and AML administrative fee and the number is presented as a percentage. Losses on loans is among the most significant elements in the profit and loss statement. This is one of the company’s most important target figures and provides information on the Bank’s ability to generate a surplus from the shareholders’ investments. Adjusted loss ratio is defined as adjusted losses on loans/average yearly adjusted net loans in percent. Losses on loans is among the most significant elements in the profit and loss statement. The development in loss ratio is an important key measure amongst investors, financial analytics and other to assess the be able to assess the underlying credit risk in the Bank’s loans to customers. 102 Notes to the financial statements