Q2 2024 Deutsche Pfandbriefbank AG Earnings Call Transcript
Key Points
- Pre-provision profit for the first half of 2024 increased by 47% year-on-year, reaching EUR150 million.
- Operating income rose by EUR19 million to EUR278 million, supported by a 14% increase in net interest income.
- The bank maintained a CET1 ratio at its ambition level of 14%, despite a temporary increase in risk-weighted assets.
- Liquidity position improved significantly, with more than EUR7 billion, covering funding needs for the year.
- The pro forma Basel IV FIRBA ratio increased to 17.2%, indicating strong capital management.
- Risk provisioning remained high at minus EUR103 million for the first half of the year, although it decreased compared to the previous period.
- The volume of new business was below the previous year's level, with a focus on increasing margins rather than volumes.
- The REF portfolio decreased slightly due to portfolio sales and active non-performing loan management.
- Stage 3 risk provisions increased, particularly related to office properties in the US and development projects in Germany.
- The cost/income ratio is expected to rise temporarily to around 50% by year-end due to strategic and IT investments.
Good morning, ladies and gentlemen, and welcome to the analyst call of Deutsche Pfandbriefbank AG. (Operator Instructions) Let me now turn the floor over to your host, Kay Wolf.
Thank you very much. Good morning, ladies and gentlemen. And I would like to welcome you to our today's analyst call. Thank you for joining. Our CFO, Marcus Schulte and I will give you a brief overview of our half year and second quarter results. We will then be happy to answer any questions you might have.
But before we dive into the numbers, please allow me to briefly reflect on my first six months at PBB. As you may recall, I gave you three reasons why I joined PBB when I took over as CEO in March. First, the bank's strong position as a senior lender in the commercial real estate financing market; second, PBB's impressive real estate expertise; and third, the opportunity to develop the bank strategically.
Today, a good five months later, I can say with deep conviction that none of the above
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