Segment reporting by operating segments

The Management Board sets performance targets, approves and monitors the budgets prepared by servicing units. Servicing units are not identical to the strategic sectors.

FMO's strategic sectors represent the economic sectors in which FMO operates. The three strategic sectors are Agribusiness Food & Water, Financial Institutions and Energy, which represent economic sectors. As per December 31, 2021, FMO's Management Board steers on the following five (in 2020: six) servicing units: Agribusiness Food & Water, Financial Institutions, Energy, Private Equity (PE) and Other. In 2021, the Management Board decided to allocate the Partnership for Impact segment to the main servicing units related to the asset portfolio. The comparatives for December 31, 2020 have been updated accordingly in this section.

In 2021, one transaction is identified, which is reallocated to a different servicing unit.

FMO presents the results of the operating segments using a financial performance measure called underlying profit. Underlying profit excludes the EUR/USD currency effects related to the results from equity investments, since all fair value changes including currency effects are now recorded in the profit and loss account instead of shareholder's equity since the adoption of IFRS 9.

Underlying profit as presented below is an alternative performance measure. A reconciliation of the underlying net profit to the net profit as reported under the statement of profit and loss is performed in the table here below.

December 31, 2021	Financial Institutions	Energy	Agribusiness, Food & Water	Private Equity	Other	Total

Interest income	105,708	103,276	48,206	2,807	6,566	266,563
Interest expenses	-7,251	-8,456	-3,723	-12,282	-4,142	-35,854
Net fee and commission income	843	6,322	-1,365	349	-452	5,697
Dividend income	-	-	-	22,066	-	22,066
Results from equity investments	-	-	-	188,254	-	188,254
Results from financial transactions	1,559	-10,844	-4,161	-19,083	6,110	-26,419
Remuneration for services rendered	6,742	5,893	4,426	10,600	4,596	32,257
Gains and losses due to derecognition	536	3,505	1,094	-	-	5,135
Other operating income	-	-	-	-	116	116
Allocated income	1,939	2,261	995	3,284	-8,479	-
Total underlying income	110,076	101,957	45,472	195,995	4,315	457,815

Operating expenses	-29,356	-26,010	-19,517	-34,016	-5,251	-114,150
Total operating expenses	-29,356	-26,010	-19,517	-34,016	-5,251	-114,150

Impairments on loans and guarantees	22,930	-8,397	-4,850	-1,424	807	9,066
Total impairments	22,930	-8,397	-4,850	-1,424	807	9,066

Profit/(loss) before taxation	103,650	67,550	21,105	160,555	-129	352,731
Share in results from associates	-	-	-	63,902	-	63,902
Taxation	-22,526	-14,681	-4,587	11,180	28	-30,586
Underlying net profit/(loss)	81,124	52,869	16,518	235,637	-101	386,047

Currency effect equity investments	-	-	-	104,599	-	104,599
Net profit/(loss)	81,124	52,869	16,518	340,236	-101	490,646

December 31, 2020	Financial Institutions	Energy	Agribusiness, Food & Water	Private Equity	Other	Total

Interest income	128,411	127,472	53,277	6,895	7,578	323,633
Interest expenses	-17,835	-21,258	-9,038	-24,035	-10,479	-82,645
Net fee and commission income	1,146	2,058	117	636	-358	3,599
Dividend income	-	-	-	32,908	-	32,908
Results from equity investments	-	-	-	-92,502	-	-92,502
Results from financial transactions	-1,248	-3,786	-2,807	-3,371	404	-10,808
Remuneration for services rendered	5,436	6,398	4,455	10,202	3,445	29,936
Gains and losses due to derecognition	-	-	2,000	-	-	2,000
Other operating income	-	-	-	38	255	293
Allocated income	-784	-934	-397	-1,056	3,171	-
Total underlying income	115,126	109,950	47,607	-70,285	4,016	206,414

Operating expenses	-35,464	-32,363	-27,420	-38,743	-10,160	-144,150
Total operating expenses	-35,464	-32,363	-27,420	-38,743	-10,160	-144,150

Impairments on loans and guarantees	-32,258	-35,294	-8,578	-2,111	-141	-78,382
Total impairments	-32,258	-35,294	-8,578	-2,111	-141	-78,382

Profit/(loss) before taxation	47,404	42,293	11,609	-111,139	-6,285	-16,118
Share in results from associates	-	-	-	-66,416	-	-66,416
Taxation	-8,050	-7,181	-1,971	8,782	1,070	-7,350
Underlying net profit/(loss)	39,354	35,112	9,638	-168,773	-5,215	-89,884

Currency effect equity investments	-	-	-	-115,383	-	-115,383
Net profit/(loss)	39,354	35,112	9,638	-284,156	-5,215	-205,267

Segment assets December 31, 2021	Financial Institutions	Energy	Agribusiness, Food & Water	Private Equity	Other	Total

Loans to the private sector	2,260,346	1,514,056	960,103	25,166	15,020	4,774,691
Equity investments and investments in associates	-	-	-	2,315,987	-	2,315,987
Other assets	705,330	472,454	299,595	730,545	4,687	2,212,611
Total assets	2,965,676	1,986,510	1,259,698	3,071,698	19,707	9,303,289
Contingent liabilities – Effective guarantees issued	49,905	18,919	-	517	-	69,341
Assets under management (loans and equity investments) managed for the risk of the state	145,350	179,044	139,367	561,741	-	1,025,502

Segment assets December 31, 2020	Financial Institutions	Energy	Agribusiness, Food & Water	Private Equity	Other	Total

Loans to the private sector	2,026,486	1,656,547	973,813	35,105	66,513	4,758,464
Equity investments and investments in associates	-	-	-	1,983,896	-	1,983,896
Other assets	677,988	554,220	325,802	675,484	22,253	2,255,747
Total assets	2,704,474	2,210,767	1,299,615	2,694,485	88,766	8,998,107
Contingent liabilities – Effective guarantees issued	22,953	43,056	-	-	-	66,009
Assets under management (loans and equity investments) managed for the risk of the state	157,327	173,442	136,136	457,885	-	924,790