Interim Results

SAMPO HOUSING LOAN BANK PLC'S INTERIM REPORT, JANUARY-JUNE, 2006

Sampo Housing Loan Bank's profit for the period increased to EUR 3.5 million (-0.1) as a consequence of the activation of the company's operations during the second half of year 2005. In September 2005 Sampo Housing Loan Bank launched the first benchmark size Nordic covered bond, nominally valued at EUR 1 billion. As the collateral for the bond the company purchased a EUR 1.1 billion mortgage portfolio from Sampo Bank.

RESULTS

The profit before taxes for the review period was EUR 4.7 million. The comparison period of 2005 recorded a EUR 0.1 million loss. The result was improved by the increase in net interest income

to EUR 4.9 million.

BALANCE SHEET

The balance sheet increased to EUR 1,128.7 million (24.9). The loan portfolio at the end of the review period was EUR 1,078.8 million (22.7). The company purchases mortgages from Sampo Bank to secure the covered bond. During the review period purchases substituting repaid loans totalled EUR 154 million.

The carrying amount of the covered bond was EUR 941.8 million and nominal value EUR 1,000 million.

Moody's Investors Service Ltd has confirmed the bond an Aaa credit rating. The covered bond was secured by mortgages totalling EUR 1,071.1 million. The mortgages covered the nominal value of the bond by 107.1 per cent.

The amount of non performing loans was EUR 0.3 million at 30 June, 2006. The company had no impairment losses during the review period.

CAPITAL ADEQUACY

The capital adequacy ratio at 30 June, 2006 was 11.8 per cent, while the ratio at 31 December 2005 was 11.1 per cent. Risk-weighted assets totalled EUR 568.3 million, while the amount was EUR 577.1 million at 31 December, 2005.

ADMINISTRATION

The Annual General Meeting on 15 March, 2006 elected the following as members of the Board of Directors: Jarmo Lankinen, Lauri Iloniemi and Antti Korri and. Jarmo Lankinen serves as Chairman of the Board. Jari Raassina serves as the company's Managing Director.

Ernst & Young Oy, Authorised Public Accountants, with principal responsibility Kunto Pekkala APA and Tomi Englund, APA were elected as auditors.

During the review period Sampo Housing Loan Bank had no employees. The company purchases administrative services from Sampo Bank.

Sampo Housing Loan Bank applies International Financial Reporting Standards (IFRS) approved by EU in its financial statements starting 1 January, 2006. The impact of the transition is described at the end of this interim report at item Sampo Housing Loan Banks transition to International Financial Reporting Standards. This interim report is prepared in accordance with IAS 34 Interim Financial Reporting.

OUTLOOK

The result for the whole year 2006 is expected to remain good. Sampo Housing Loan Bank plans to issue a new covered bond in the autumn 2006.

The figures for this interim period are unaudited. Sampo Housing Loan Bank plc publishes one interim report during the financial year.

Helsinki 10 August, 2006

Sampo Housing Loan Bank plc

Board of Directors

SAMPO HOUSING LOAN BANK PLC - FINANCIAL HIGHLIGHTS

		1-6/2006	1-6/2005	1-12/2005

Total income	1000 EUR	6 210	7	4 653
Total operating expenses	1000 EUR	-1 533	-110	-1 645
Profit before taxes	1000 EUR	4 677	-103	3 007
Cost to income ratio	%	24.7	1 639.3	35.4
Total assets	1000 EUR	1 128 693	24 946	1 119 065
Equity	1000 EUR	47 310	6 520	43 849
Return on equity	%	15.2	-3.1	8.8
Capital adequacy	%	11.8	55.4	11.1
Return on assets	%	0.6	-0.8	0.4
Equity/assets ratio	%	4.2	26.1	3.9



FORMULAS USED IN CALCULATING THE FINANCIAL HIGHLIGHTS

Cost to income ratio, %:
Other operating expenses
.................................			x 100

Net interest income + Net fee and commission income + Net income
from financial transactions + Net income from investments +
Other operating income

Return on equity, %:
Profit before taxes - taxes
................................			x 100

Equity (average)

Return on assets, %
Profit before taxes - taxes
................................			x 100

Total assets (average)

Equity/assets ratio, %
Equity
................................			x 100

Total assets

SAMPO HOUSING LOAN BANK PLC - INCOME STATEMENT BY HALF-YEAR

1000 EUR	1-6/2006	7-12/2005	1-6/2005

Net interest income	4 918	4 407	-20
Net income from financial transactions	1 172	159	-
Net fee and commission income	120	73	26
Net income from investments	-	7	-
Other operating income	-	0	-
Total operating income	6 210	4 646	7

Other operating expenses	-1 533	-1 535	-110
Total operating expenses	-1 533	-1 535	-110

Profit before taxes	4 677	3 111	-103

Taxes	-1 216	-782	-
Profit for the period	3 461	2 329	-103

SAMPO HOUSING LOAN BANK PLC - INCOME STATEMENT

1000 EUR	Note	1-6/2006	1-6/2005	Change	1-12/2005

Net interest income	1	4 918	-20	4 938	4 387
Net income from financial transactions	2	1 172	-	1 172	159
Net fee and commission income	3	120	26	94	99
Net income from investments	4	-	-	-	7
Other operating income		-	-	-	0
Total operating income		6 210	7	6 204	4 653

Other operating expenses		-1 533	-110	-1 423	-1 645
Total operating expenses		-1 533	-110	-1 423	-1 645

Profit before taxes		4 677	-103	4 781	3 007

Taxes		-1 216	-	-1 216	-782
Profit for the period		3 461	-103	3 565	2 225

SAMPO HOUSING LOAN BANK PLC - BALANCE SHEET

1000 EUR
	Note	6/2006	12/2005	6/2005
Assets
Financial assets at fair value through p/l	5, 6	1 378	785	-
Loans and receivables	7	1 106 803	1 109 466	24 847
Other assets		20 513	8 814	38
Tax assets		-	-	60
Total assets		1 128 693	1 119 065	24 945

Liabilities
Financial liabilities at fair value through p/l	5, 6	49 718	20 513	-
Amounts owed to credit institutions
and customers	8	40 000	45 000	16 500
Debt securities in issue	9	961 808	991 739	1 669
Other liabilities		28 650	17 295	256
Tax liabilities		1 207	669	-
Total liabilities		1 081 383	1 075 216	18 425

Equity
Share capital		23 550	23 550	6 050
Reserves		17 500	17 500	-
Retained earnings		6 260	2 799	470

Total equity		47 310	43 849	6 520

Total equity and liabilities		1 128 693	1 119 065	24 945

SAMPO HOUSING LOAN BANK PLC - STATEMENT OF CHANGES IN EQUITY

1000 EUR	Share capital	Share premium account	Retained earnings	Total

Equity at 1 Jan. 2005 FAS = IFRS	6 050		574	6 624
Sampo Banks investment	17 500	17 500		35 000
Profit for the financial year			2 225	2 225
Equity at 31 December 2005	23 550	17 500	2 799	43 849


Equity at 1 Jan. 2006	23 550	17 500	2 799	43 849
Profit for the financial year			3 461	3 461
Equity at 30 June 2006	23 550	17 500	6 260	47 310

SAMPO HOUSING LOAN BANK PLC - CASH FLOW STATEMENT

1000 EUR	1-6/2006	1-6/2005	1-12/2005

Cash and cash equivalent at the beginning of the period	9 697	691	691
Cash flows from/used in operating activities	12 274	1 497	-1 035 947
Cash flows from/used in financing activities	-486	0	1 044 953
Cash and cash equivalent at the end of the period	21 485	2 189	9 697

The cash flow statement reports cash flows during the period classified by operating, investing and financing activities. Cash flows are reported by using the indirect method. Cash flows from operating activities derive primarily from the principal revenue-producing activities. Financing activities include cash flows resulting from changes in equity and borrowings in order to conduct the business. Cash and cash equivalents consist of cash at bank and in hand, balances with central banks, loans and advances to credit institutions repayable on demand and short-term deposits (under 3 months).

1 NET INTEREST INCOME
	1-6/2006	1-6/2005	1-12/2005
Interest income
Loans and receivables	19 320	219	13 583
Other interest income	0	-	0
Total	19 320	219	13 583

Interest expenses
Amounts owed to credit institutions and customers	-588	-200	-663
Debt securities in issue	-13 647	-39	-6 345
Other interest expenses	-168	-	-2 187
Total	-14 402	-239	-9 195

Net interest income	4 918	-20	4 387

Net interest income in income statement, total
In net interest income	4 918	-20	4 387
In net income from financial transactions	511	-	3
In net income from investments	-	-	7
Total	5 429	-20	4 398


2 NET INCOME FROM FINANCIAL TRANSACTIONS
		1-6/2006	1-6/2005		1-12/2005
Trading assets/liabilities
Interest rate derivatives		933	-		788
Total		933	-		788

Net income from hedge accounting
Change in fair value of hedging derivative instruments		-29 034	-		-20 513
Change in fair value of hedged items		29 274	-		19 883
Total		239	-		-630

Net income from financial transactions, total		1 172	-		159
3 FEE AND COMMISSION INCOME AND EXPENSES
	1-6/2006			1-6/2005		1-12/2005

Fee and commission income
Lending	127			27		124
Other	-			-		0
Total	127			27		124

Fee and commission expenses	-7			0		-25

Net fee and commission income	120			26		99


4 NET INCOME FROM INVESTMENTS
	1-6/2006			1-6/2005		1-12/2005
Financial assets
Financial asset available-for-sale
Debt securities	-			-		7
Total	-			-		7

Net income from investments, total	-			-		7

5	FINANCIAL ASSETS AND LIABILITIES AT FAIR VALUE THROUGH P/L
		6/2006		12/2005		6/2005
		Assets	Liabilities	Assets	Liabilities	Assets	Liabilities
	Derivative financial instruments (note 6)	1 378	49 718	785	20 513	-	-
	Financial assets and liabilities at fair value through p/l, total	1 378	49 718	785	20 513	-	-

6	DERIVATIVE FINANCIAL INSTRUMENTS
			6/2006			12/2005
		Notional	Fair value		Notional	Fair value
	Derivatives held for trading	amount	Assets	Liabilities	amount	Assets	Liabilities
	Interest rate derivatives	1 041 229	1 207	-	1 093 388	785	-
	Total derivatives held for trading	1 041 229	1 207	-	1 093 388	785	-

	Derivatives held for hedging
	Derivatives designated as fair value hedges	1 037 782	170	49 718	1 000 000	-	20 513
	Total derivatives held for hedging	1 037 782	170	49 718	1 000 000	0	20 513

	Total derivative financial instruments	2 079 010	1 378	49 718	2 093 388	785	20 513

			6/2005
		Notional	Fair value
	Derivatives held for trading	amount	Assets	Liabilities
	Interest rate derivatives	-	-	-
	Total derivatives held for trading	-	-	-

	Derivatives held for hedging
	Derivatives designated as fair value hedges	10 370	-	-
	Total derivatives held for hedging	10 370	-	-

	Total derivative financial instruments	10 370	-	-

7	LOANS AND RECEIVABLES
		6/2006	12/2005	6/2005
	Loans and advances to credit institutions
	By type of loan
	Deposits	27 964	16 078	2 189
	Total	27 964	16 078	2 189

	Loans and advances to customers
	By type of loan
	Home loans	967 235	964 891	22 659
	Consumer loans	71 061	83 540
	Other consumer loans	40 291	44 625
	Other commercial loans	252	332
	Total	1 078 839	1 093 388	22 659

	Total loans and receivables	1 106 803	1 109 466	24 847

8	AMOUNTS OWED TO CREDIT INSTITUTIONS AND CUSTOMERS
		6/2006	12/2005	6/2005
	Amounts owed to credit institutions
	Other liabilities owed to credit institutions	40 000	45 000	16 500
	Total	40 000	45 000	16 500

	Total amounts owed to credit institutions and customers	40 000	45 000	16 500

9	DEBT SECURITIES IN ISSUE
		6/2006	12/2005	6/2005
	Debt securities in issue
	Bonds and notes	941 808	971 739	1 669
	Total	941 808	971 739	1 669

	Subordinated debt securities
	Debentures	20 000	20 000	-
	Total	20 000	20 000	-

	Total debt securities in issue	961 808	991 739	1 669

10	CONTINGENT LIABILITIES AND COMMITMENTS
		6/2006		12/2005	6/2005

	Off-balance sheet items
	Undrawn loans, overdraft facilities and other commitments to lend	94		504	-
	- original maturity less than one year			-	-
	- original maturity more than one year	94		504	-
	Total	94		504	-

	Assets pledged as collateral for liabilities or contingent liabilities

		6/2006			12/2005		6/2005
	Assets pledged as collateral	Assets pledged	Liabilities/ commit-ments		Assets pledged	Liabili-ties/ commit- ments	Assets pledged	Liabilities/ commit-ments
	Loans and receivables
	Lending	1 071 129	941 808		1 086 202	971 739	-	-

SAMPO HOUSING LOAN BANK'S TRANSITION TO INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS)

In 2001 the EU Commission issued a Regulation requiring listed companies in the EU area to prepare their consolidated financial statements in accordance with the IAS/IFRS standards from 2005 onwards. The EU Parliament and Council of Ministers adopted the Regulation in June 2002. The requirement to prepare financial statements in accordance with the IAS/IFRS standards apply also to those listed companies which do not prepare consolidated financial statements.

The Finnish Accounting Act amended at the beginning of 2005 applying the transitional provisions of the EU Regulation, according to which the international accounting standards are mandatory to the companies whose debt securities only are admitted on a regulated market on or after January 2007.

The parent company of Sampo Housing Loan Bank plc, Sampo Bank, as a part of Sampo Group adopted the IFRS in its consolidated financial statements from the beginning of 2005. Sampo Housing Loan Bank transferred to IFRS on 1 January 2006. The opening balance sheet was prepared for 1 January 2005.

The Finnish Accounting Standards (FAS) amended on 1 January 2005 so that the accounting treatment of the financial assets and liabilities of credit institutions and investment firms is equal to the treatment in IAS 39. While the great majority of the items in the financial statements of the Housing Loan Bank consist of the financial assets and liabilities, the transition to IFRS caused no differences in the opening balance sheet.

From 1 January 2006 the income statement and balance sheet formats of Sampo Housing Loan Bank were changed to correspond with those of Sampo Bank Group. The figures for the comparison period were changed to comply with the new presentation.

Interim Results

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