The Finnish Financial Supervisory Authority has assessed the financial sector’s risk-bearing capacity as strong in the first half of 2026, while identifying operational and cyber risks alongside continuing geopolitical and trade policy threats. Finland’s economic recovery and stronger confidence have stabilized the risk landscape, although high unemployment, rising bankruptcies and weak home purchase intentions remain pressures. Frontier artificial intelligence models have changed the cyber threat landscape by supporting the detection and exploitation of vulnerabilities, but the authority received no reports of significant service disruptions caused by foreign interference in 2026. Banks maintained capital ratios above the European average, with a Common Equity Tier 1 ratio of 18.1% and a total capital ratio of 21.7% at the end of June. Operating profit declined year on year as net interest income and trading and investment income fell and expenses increased, although the decline in net interest income levelled off in the second quarter. Nonperforming loans remained moderate, while liquidity was stable and banks held ample capital over regulatory requirements. The employee pension sector’s solvency ratio rose to 132.5% as first-half investment returns reached 5.6%, while equities increased to a record 58.7% of portfolios. Life insurers’ solvency ratio was broadly stable at 213%, and non-life insurers’ ratio declined to 248% from 257%. Strong investment markets also lifted domestic fund capital to EUR 247.6 billion and supported higher results at management companies and investment firms, whose own funds and liquidity remained compliant with prudential requirements.

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