Helaba Reports Best Semi-Annual Performance Ever

Net interest income after risk provisions and net trading income are increasing;banking levy adversely affects general administrative expenses
FRANKFURT, Germany, (informazione.it - comunicati stampa - servizi)

Net interest income after risk provisions and net trading income are increasing;
banking levy adversely affects general administrative expenses

Net interest income, amounting to EUR 488 million, remained nearly at the previous year's level (EUR 492 million), in particular because volume-related declines were offset by satisfactory margins. Net interest income increased both in the real estate business and at Frankfurter Sparkasse.

Loan loss provisions declined again, to EUR -99 million (previous year: EUR -134 million). Net interest income after loan loss provisions accordingly amounted to EUR 389 million, an improvement of EUR 31 million on the year before.

Net commission income, amounting to EUR 131 million, is also at the previous year's level. The discontinuation of commission payments due to the deconsolidation of the Hannover Leasing Group at the end of last year was offset by higher commission income from other business segments.

Net trading income rose strongly, by EUR 140 million, to EUR 173 million. The previous year's result had been adversely affected by negative valuation effects from the widening of the credit spreads and a general weakening of the Euro. Drivers of success in the first half of 2011 were not only the positive development of spreads but in particular the excellent customer business in securities and derivatives.

The result from hedges/derivatives, amounting to EUR 38 million, exceeds the previous year's figure by EUR 88 million. This rise is essentially due to the valuation of banking book derivatives.

Net income from non-current financial assets, amounting to EUR -20 million (EUR -1 million in the year before), is adversely affected by the write-downs on Greek government bonds in an amount of EUR 30 million. This corresponds to a value adjustment in an amount of 34 per cent of the nominal volume of EUR 86 million.

The decline of the other operating result, from EUR 171 million to EUR 101 million, is due to the deconsolidation of the Hannover Leasing Group.

General administrative expenses declined from EUR 516 million to EUR 479 million. Adjusted for the effect of deconsolidation, there is however an increase of EUR 22 million which is nearly exclusively (EUR 20 million) due to the banking levy, which has been taken into account pro rata temporis.

After-tax comprehensive income, which in addition to net income comprises other comprehensive income that is to be recognised in equity, amounts to EUR 319 million in the first half of the year; this is an increase of EUR 227 million on the previous year's figure. Valuation gains of financial assets in particular contributed to this result.

Balance Sheet Total declines - Systematic Reduction of off-balance sheet Risks

The consolidated balance sheet total has declined to EUR 157.7 billion. This is a decrease by EUR 8.5 billion as compared with 31 December 2010. The positions loans and advances to banks, loans and advances to customers and assets held for trading have contributed to this development which is to a significant extent due to exchange rate fluctuations. Loans and advances to banks and assets held for trading have been systematically reduced over the past several years already. In preparation for the new prudential liquidity requirements, financial assets have been methodically increased. As before, the balance sheet structure on the assets side remains characterised by loans and advances to customers and the S-Group business (share: 60 per cent). The volume of off-balance sheet obligations is down by 13.4 per cent to EUR 22.5 billion. This is due to the selective reduction of risk positions, in particular at the New York Branch.

The medium- and long-term new business volume, amounting to EUR 6.4 billion, significantly exceeded the previous year's figure of EU 5.0 billion. The Bank assumes that the target of EUR 12.3 billion planned for the new business volume in 2011 will be slightly exceeded.

In the first half of the year, Helaba raised medium- and long-term funding in a volume of EUR 6.1 billion. Of this total, unsecured issues accounted for EUR 3.9 billion and Public Pfandbriefe and Mortgage Pfandbriefe accounted for EUR 2.2 billion. In the second quarter, the Bank issued a Public Jumbo Pfandbrief in a volume of EUR 1 billion. It was placed, with a highly attractive spread, primarily with international institutional investors. Customer deposits of Frankfurter Sparkasse and of 1822direkt continue to contribute to the broadening and diversification of the Group's funding basis.

The ratings of Helaba for unsecured long-term liabilities have remained unchanged in the first half of the year. They rank in the top group of German credit institutions. With a Tier-1 Capital Ratio of 11.1 per cent (31 December 2010: 9.6 per cent) und a Total Capital Ratio of 16.8 per cent (31 December 2010: 14.4 per cent), the Helaba Group is sufficiently endowed with liable capital. In the second half of the year 2011, the hardening of the silent participations held by the State of Hesse in the amount of EUR 1.92 billion as "Core Tier-1 Capital", which was publicly and with legally binding effect announced by the owners of Helaba, will be implemented. Brenner: "Helaba will thus comply with the capital requirements under Basel III early on and without availing itself of transitional periods."

Outlook: Significantly higher Earnings expected

As regards the business and earnings development in the year 2011, the Helaba CEO remains optimistic: "Even though the early indicators are heralding a distinctly slower expansion of the German economy, the upswing is expected to continue into the coming year. Despite the debt crisis that is persisting in some Euro countries and the market volatilities associated with the downgrading of the USA, which render a forecast for the year difficult, I see Helaba's performance on a positive course. For the whole of 2011, I expect group profit - as planned - to significantly exceed the previous year's result."

[1]incl. banking levy

Press and Communications

MAIN TOWER · Neue Mainzer Straße 52-58
60311 Frankfurt am Main · http://www.helaba.de
Tel: +49(0)69-9132-2192


Wolfgang Kuß    
E-Mail: [email protected] 

Ursula-Brita Krück
E-Mail: [email protected]

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