4 Segment information

The Management Board sets performance targets, approves and monitors the budgets prepared by operating segments. operating segments 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 also represent economic sectors. FMO's Management Board steers on the following six operating segments: Agribusiness, Food & Water, Financial Institutions and Energy, Private Equity, Partnership for impact and Other. In first half of 2021, no transactions are identified which are reallocated to a different operating segments.

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 the adoption of IFRS 9, all fair value changes including currency effects are now recorded in the profit and loss account instead of shareholder's equity.

Underlying profit as presented below is an alternative performance measure. The table below shows a reconciliation of the underlying net profit to the net profit.

At June 30, 2021	Financial Institutions	Energy	Agribusiness, Food & Water	Private Equity	Partnership for impact	Other	Total

Interest income	52,425	53,361	24,055	2,038	187	4,044	136,110
Interest expenses	-3,428	-3,962	-1,857	-4,910	-45	-1,393	-15,595
Net fee and commission income	1,110	6,515	24	175	-	-174	7,650
Dividend income	-	-	-	9,850	-	-	9,850
Results from equity investments	-	-	-	57,412	-	-	57,412
Results from financial transactions	3,355	-7,688	-2,055	-2,368	-	6,027	-2,729
Remuneration for services rendered	2,261	2,994	1,928	4,179	3,096	82	14,540
Gains and losses due to recognition	-	58	1,094	-	-	-	1,152
Other operating income	-	-	-	-	-	59	59
Total underlying income	55,723	51,278	23,189	66,376	3,238	8,645	208,449

Operating expenses	-14,845	-13,621	-11,598	-17,030	-4,945	-3,548	-65,587
Total operating expenses	-14,845	-13,621	-11,598	-17,030	-4,945	-3,548	-65,587

Impairments on loans and guarantees	21,900	5,480	3,688	-724	135	-2,233	28,246
Total impairments	21,900	5,480	3,688	-724	135	-2,233	28,246

Profit/(loss) before taxation	62,778	43,137	15,279	48,622	-1,572	2,864	171,108
Share in results from associates	-	-	-	8,789	-	-	8,789
Taxation	-15,218	-10,457	-3,704	3,897	393	-716	-25,805
Underlying net profit/(loss)	47,560	32,680	11,575	61,308	-1,179	2,148	154,092

Currency effect equity investments				44,305			44,305
Net profit/(loss)	47,560	32,680	11,575	105,613	-1,179	2,148	198,397

Segment assets at June 30, 2021	Financial Institutions	Energy	Agribusiness, Food & Water	Private Equity	Partnership for impact	Other	Total

Loans to the private sector	1,995,172	1,547,624	932,038	35,749	14,519	46,941	4,572,043
Equity investments and investments in associates	-	-	-	2,144,423	-	-	2,144,423
Other assets	824,854	639,827	385,328	901,338	6,003	19,405	2,776,755
Total assets	2,820,026	2,187,451	1,317,366	3,081,510	20,522	66,346	9,493,221
Contingent liabilities – Effective guarantees issued	78,726	43,994	-	496	-	-	123,216
Assets under management (loans and equity investments) managed for the risk of the state	148,772	180,279	145,869	508,275	-	-	983,195

At June 30, 2020	Financial Institutions	Energy	Agribusiness, Food & Water	Private Equity	Partnership for impact	Other	Total

Interest income	71,859	66,509	26,308	2,120	391	5,641	172,828
Interest expenses	-13,331	-15,628	-6,612	-15,442	-212	-6,869	-58,094
Net fee and commission income	569	-1,218	-303	540	-	-154	-566
Dividend income	-	-	-	20,166	-	-	20,166
Results from equity investments	-	-	-	-170,319	-	-	-170,319
Results from financial transactions	-6,307	2,035	-4,969	-2,419	-	-16,421	-28,081
Remuneration for services rendered	2,493	3,261	1,694	4,494	3,195	84	15,221
Gains and losses due to recognition	-	-	2,000	-	-	-	2,000
Other operating income	-	-	-	38	-	577	615
Total underlying income	55,283	54,959	18,118	-160,822	3,374	-17,142	-46,230

Operating expenses	-15,759	-14,126	-11,854	-16,396	-4,252	-2,937	-65,324
Total operating expenses	-15,759	-14,126	-11,854	-16,396	-4,252	-2,937	-65,324

Impairments on loans and guarantees	-43,417	-44,301	-17,326	-464	-51	-206	-105,765
Total impairments	-43,417	-44,301	-17,326	-464	-51	-206	-105,765

Profit/(loss) before taxation	-3,893	-3,468	-11,062	-177,682	-929	-20,285	-217,319
Share in results from associates	-	-	-	-66,950	-	-	-66,950
Taxation	973	867	2,765	10,636	232	7,876	23,349
Underlying net profit/(loss)	-2,920	-2,601	-8,297	-233,996	-697	-12,409	-260,920

Currency effect equity investments	-	-	-	-18,682	-	-	-18,682
Net profit/(loss)	-2,920	-2,601	-8,297	-252,678	-697	-12,409	-279,602

Segment assets at June 30, 2020	Financial Institutions	Energy	Agribusiness, Food & Water	Private Equity	Partnership for impact	Other	Total

Loans to the private sector	2,134,659	1,755,437	958,399	33,577	17,694	55,292	4,955,058
Equity investments and investments in associates	-	-	-	1,938,007	-	-	1,938,007
Other assets	830,585	683,032	372,908	767,134	6,884	21,515	2,682,058
Total assets	2,965,244	2,438,469	1,331,307	2,738,718	24,578	76,807	9,575,123
Contingent liabilities – Effective guarantees issued	27,425	47,352	-	-	-	-	74,777
Assets under management (loans and equity investments) managed for the risk of the state	160,633	200,859	145,848	470,946	-	-	978,286