Hypo Real Estate Holding GmbH
Hypo Real Estate Holding AG: HRE is publishing interim report as of 30 September 2009
Hypo Real Estate Holding AG / Interim Report 11.11.2009 Dissemination of a Corporate News, transmitted by DGAP - a company of EquityStory AG. The issuer / publisher is solely responsible for the content of this announcement. --------------------------------------------------------------------------- HRE is publishing interim report as of 30 September 2009 * Pre-tax loss in the first nine months of 2009: EUR -1.78 billion * Net income/loss: EUR -1.71 billion * Pre-tax profit/loss in the third quarter: EUR -709 million * Result depressed by downturn on the real estate markets Munich, 11 November 2009 - HRE has reported pre-tax profit / loss of around EUR -1.78 billion for the first nine months of this year (9M/2008: around EUR -2.90 billion); net income / loss amounts to around EUR -1.71 billion (9M/2008: EUR -2.89 billion). For the third quarter of 2009, HRE has reported consolidated pre-tax profit/loss of EUR -709 million (9M/2008: around EUR -3.11 billion). Net income / loss was EUR -574 million (9M/2008; around EUR -3.05 billion). The operating revenues totalled EUR 244 million compared with EUR -345 million in the corresponding prior year quarter. The figures for the first nine months of this year are only comparable to a limited extent with the prior year figures, which were very negative, due to different factors. Last year, results were affected primarily by impairments recognised in relation to the goodwill, intangible assets of DEPFA BANK plc and structured products. This year, results have been affected mainly by impairments recognised in relation to receivables. These impairments are connected with the financial market crisis and the economic downturn, which in particular is also affecting the commercial real estate market. In addition, this year, net commission income has been affected by the expenses of the liquidity support which has been received, and general administrative expenses have been affected by the expenses of the strategic refocusing. However, the third quarter also experienced progress with the restructuring and strategic refocusing of the Group. The strategic core bank, namely pbb Deutsche Pfandbriefbank, is now operating on the market with a new brand and a new corporate image, originating new business and being active on the refinancing markets. Progress is also being made with streamlining the balance sheet of HRE without placing a strain on capital. Total assets have fallen by 11% to EUR 373.8 billion. The CEO of Hypo Real Estate Holding AG and Deutsche Pfandbriefbank AG, Axel Wieandt, said: 'The result of the first nine months of this year is not satisfactory; however, it is due to the difficult conditions on the market and the special situation of the Group. We still have a long way to go before we will meet our objective - but good progress is being made with the process of restructuring. Conditions on the market will continue to be difficult.' Selective new business pbb Deutsche Pfandbriefbank continues to be active on the market. In the first nine months of the year, new real estate financing business amounted to EUR 2.7 billion. New business of EUR 1.7 billion was written in the third quarter alone. In public sector finance, new business in the first nine months amounted to EUR 0.2 billion. Capital ratios improved by support provided by the SoFFin As reported last week, the steering committee of the Financial Market Stabilisation Fund SoFFin has decided to grant further support to HRE. The Group will initially receive an additional EUR 3.0 billion as a further tranche. In its statement, the SoFFin has again confirmed that it intends to adequately recapitalise the Group and to make the necessary liquidity available. The current recapitalisation will improve the regulatory capital ratios of HRE Holding and the group companies. On the basis of the figures as of 30 September 2009 and thus before the further capital contribution described above, the core capital ratio was 6.1 percent for the Group, 2.6 percent for Deutsche Pfandbriefbank AG and 6.6 percent for DEPFA BANK plc. If the recapitalisation as part of the further tranche of EUR 3 billion had taken place in the third quarter, the ratios would have been as follows: HRE Group 9.7 percent, Deutsche Pfandbriefbank AG 7.3 percent and DEPFA BANK plc 7.1 percent. The Group is accordingly now fully in line again with the minimum capital ratios specified by law. It has however to be borne in mind that the ratios will deteriorate in view of the probable net loss for the year as of 31 December 2009. Note for editors: We have enclosed explanations to the consolidated income statements for the first nine months, the development in assets and in the financial position as well as the regulatory ratios. Media contacts: Walter Allwicher, +49 (0)89 203007 787, walter.allwicher@hyporealestate.com Oliver Gruß, +49 (0)89 203007 781, oliver.gruss@hyporealestate.com Appendix 1: Group development 9M/2009 The income statement for the first nine months of 2009 is detailed in the following: * Operating revenues of EUR 512 million were higher than the corresponding figure for the prior year period (EUR 75 million). This was due to the improvements in net interest income, net trading income and net income from financial investments, which are mainly attributable to positive market movements. o Net interest income increased to around EUR 1.05 billion, compared with EUR 957 million in the first nine months of 2008. The increase is attributable to income generated with money market operations as well as drawn US customer liquidity facilities. The income generated with money market operations was attributable to the lower level of market interest rates which, at the beginning of 2009, enabled HRE to take advantage of lower refinancing costs in conjunction with constant revenues generated by lending operations. The drawn US customer liquidity facilities have boosted net interest income as a result of their high interest rates. A further positive factor has been the net interest income attributable to the securities which in 2008 were reclassified as loans and receivables, whereas they had previously been classified as held-for-trading. The one-off revenues attributable to sales of receivables, premature repayment penalties as well as repurchasing and redemptions of financial liabilities declined compared with the prior year (9M/2009: EUR 37 million, 9M/2008: EUR 99 million). o Net commission income amounted to EUR -304 million compared with EUR 104 million in the corresponding prior year period. The decline is primarily attributable to expenses of EUR -382 million for the guarantees in connection with the liquidity support provided by SoFFin and the German Federal Government. The much lower level of new business and lower income from Capital Markets & Asset Management (an operating segment which is being discontinued by HRE) also had an impact in this respect. HRE generated slightly higher income with new customer derivative business (current year: EUR 20 million, prior year: EUR 13 million). o Net trading income in 2009 so far amounts to EUR -2 million, and is considerably higher than the corresponding prior year figure (9M/2008: EUR -435 million), because the effect of the valuation of synthetic collateralised debt obligations (CDOs) recognised in the income statement had a considerably lower impact on net trading income (9M/2009: EUR -66 million, 9M/2008: EUR -218 million). In addition, the lower probability of default in connection with the restructuring of a US monoline insurer also had a positive impact in the third quarter of 2009. This partially compensated for the impairments recognised in the income statement in previous quarters. In addition, a book profit has been generated with the sale of claims against the US investment bank Lehman Brothers Inc., which has filed for creditor protection. These claims had been almost completely written off and revalued in 2008. o The net income from financial investments amounted to EUR -43 million in the first nine months of the year compared with EUR -528 million in the corresponding prior year period. This is mainly attributable to impairments recognised in relation to cash CDOs of EUR -22 million (9M/2008: EUR -409 million). The impairments recognised in relation to mortgage-backed securities amounted to EUR -29 million (9M/2008: EUR -4 million). Portfolio-based allowances of EUR -9 million have also been created. On the other hand, profits from the sale of financial investments of EUR 10 million were realised (9M/2008: EUR 49 million). o The net income from hedge relationships amounted to EUR -137 million, and was thus lower than the corresponding prior year figure of EUR -34 million. Two factors are reflected in the net income from hedge relationships: Hedge inefficiencies of EUR -131 million (9M/2008: EUR 2 million) within the range of 80% to 125% permitted under IAS 39, as well as the valuation result of EUR -6 million (2008: EUR -36 million) resulting from designated at Fair Value through Profit or Loss (dFVTPL) assets and related derivatives. The hedge inefficiencies resulted mainly from the volatility of short-term interest rates. This consequently had a positive impact on net interest income in the period under review, and had a negative impact on the net income from hedge relationships. The net income from hedge relationships is a reversal of the corresponding figure for the prior year which was very positive. The fair values of the dFVTPL assets hedged against interest risks have fallen as a result of credit spread narrowing in the first quarter of 2009. This narrowing recovered to a large extent in the second and third quarters of 2009. o The balance of other operating income/expenses amounted to EUR -51 million (9M 2008: EUR 11 million), and was mainly attributable to currency translation effects (mainly US$) of EUR -58 million (9M 2008: EUR 12 million). * Additions to provisions for losses on loans and advances increased to around EUR 1.89 billion mainly as a result of the deterioration in the commercial real estate markets (9M/2008: EUR 247 million). o Of the individual loan loss provisions which were recognised, real estate loans accounted for EUR 1.43 billion and infrastructure and public sector financings accounted for EUR 117 million. The significant increase in provisions for losses on loans and advances for real estate financings was attributable to the further deterioration in regional economic conditions on those real estate markets which have been identified as critical for quite some time, namely North America, Southern Europe, Great Britain, and partially Germany. The increasing vacancy rates and illiquid markets have resulted in declines in the value of real estate and thus, indirectly, in increasing levels of loan defaults. The world-wide recession is also having an impact on the utilisation of infrastructure products such as motorways, airports and means of transport. o The portfolio-based allowances increased by EUR 292 million (9M/2008: Additions of EUR 115 million). The expected losses of the holdings have increased, due to the deterioration in the credit standing of some debtors and the related increase in probability of default. * General administrative expenses have declined to EUR 393 million (9M/2008: EUR 424 million). This is attributable to several factors: Personnel expenses have declined as a result of a reduced workforce (30 September 2009: 1,480 employees, 31 December 2008: 1,786 employees). The accrued liabilities for variable compensation were also lower. The accrued liabilities for variable compensation which were created in the first three quarters of 2008 were reversed in the fourth quarter of 2008. The other general administrative expenses increased mainly as a result of higher fees for IT and advisors which were not permitted to be included in the restructuring provision created in 2008. The cost-income ratio, i.e. the ratio between general administrative expenses and operating revenues, improved slightly to 76.8% (2008: > 100.0 %). * The balance of other income / expenses amounted to EUR -11 million (9M 2008: EUR 180 million). * Pre-tax profit / loss was negative in the first three quarters of 2009 with around EUR -1.78 billion (9M/2008: around EUR -2.90 billion). * Current tax expenses of EUR 29 million were opposed by deferred tax income of EUR 102 million, thus resulting in a total tax income of EUR 73 million for the first nine months of 2009 (9M 2008: tax income of EUR 6 million). The actual tax expense was incurred mainly in countries in which HRE generated positive pre-tax results. * Net income / loss amounted to around EUR -1.71 billion in the first nine months of 2009 (9M/2008: EUR -2.89 billion). Appendix 2: Development in net assets and financial position as of 30 September 2009 * Total assets of HRE declined continuously in the year under review, and amounted to EUR 373.8 billion as of 30 September 2009; this represents a decline of 11% compared with last year (31 December 2008: EUR 419.7 billion). This decline is attributable to several factors. Portfolios declined because new business and the drawings of old commitments were lower than the repayments. In addition, on-balance-sheet holdings declined as a result of exchange rate factors and the impact of the lower level of interest rates on the market values of the derivatives. These factors are reflected primarily in the items loans and advances, financial assets and trading assets. Total assets also declined as a result of the impairments recognised in relation to receivables and securities. * The total volume of lending, which comprises loans and advances to customers (excl. investments), loans and advances to other banks (excl. investments) as well as the contingent liabilities, amounted to EUR 239.7 billion as of 30 September 2009 compared with EUR 267.3 billion at the end of 2008 (a decline of 10%). * Equity (excl. the revaluation reserve) amounted to EUR 5.0 billion as of 30 September 2009, compared with around EUR 2.6 billion as of 31 December 2008. Including the revaluation reserve, equity amounted to around EUR 2.2 billion as of 30 September 2009 (31 December 2008: EUR -1.5 billion). * The revaluation reserve amounted to EUR -2.7 billion (31 December 2008: EUR -4.1 billion). The AfS reserve improved to EUR -2.1 billion as of 30 September 2009 as a result of market factors, compared with EUR -3.1 billion as of 31 December 2008. This positive development is attributable to improvements in credit spreads. The AfS reserve also increased as a result of the impairments and amortisation of securities which were reclassified in 2008 in accordance with the IAS 39 amendment 'Reclassification of Financial Assets' which was adopted in October 2008 by the IASB and endorsed by the EU. HRE had reclassified available-for-sale assets with a carrying amount of EUR 76.1 billion as loans and receivables retrospectively as of 1 July 2008. Without this reclassification, the AfS reserve after taxes in the first nine months of 2009 would have been EUR 3.5 billion higher. Including the effects from the year 2008, the AfS reserve after taxes would have been lower by a total of EUR -3.6 billion without this reclassification. * The cash flow hedge reserve amounted to EUR -0.6 billion, compared with EUR -1.0 billion at the end of last year. The change was mainly attributable to maturities of derivatives and the lower level of interest rates in the course of the year. The subscribed capital has increased by EUR 3.02 billion in the first nine months of 2009 following the recapitalisation of HRE by the SoFFin. In the first quarter of 2009, the SoFFin utilised the authorised capital to take up 20 million shares of HRE Holding for the minimum price of EUR 3.00 per share permitted by law, excluding shareholders' subscription rights. In June 2009, the SoFFin took up around 986.5 million shares as part of a capital increase which was adopted by the Extraordinary General Meeting of the Company on 2 June 2009. Since the first quarter of 2009, certain hybrid issues of DEPFA BANK plc have had to be recognised as equity instruments in accordance with IAS 32.16. The classification of financial instruments as capital instruments or debt instruments does not depend on the Company's regulations. Instead, it depends on whether the Company has a contractual obligation to make payments from an issued financial instrument. DEPFA BANK plc has issued subordinate debt in the form of undated bonds via its issuance vehicles DEPFA Funding II LP, DEPFA Funding III LP and DEPFA Funding IV LP. These hybrid capital instruments only have to make interest payments if creditors of equal ranking receive an interest payment. After the last equal-ranking liability was repaid in the first quarter of 2009, the Company no longer has a contractual obligation to make interest payments after this time. Accordingly, it was necessary for the carrying amount of these hybrid capital instruments (EUR 1.04 billion) to be reclassified under equity (instead of under subordinated liabilities). Appendix 3: Regulatory indicators The regulatory own funds according to the German Solvency Regulation (SolvV) amounted to around EUR 6.71 billion as of 30 September 2009. On 31 December 2008, pro-forma own funds amounted around to EUR 5.0 billion as per the approved annual financial statements 2008 and after the result distribution 2008. The core capital amounted to EUR 5.10 billion as of 30 September 2009. On 31 December 2008, the core capital (pro-forma) was around EUR 2.93 billion as per the approved financial statements 2008 and after the result distribution 2008. The capital ratios as of 30 September 2009 and 31 December 2008 are accordingly as follows: * The core capital ratio (incl. risk-weighted credit risk positions as well as the capital requirements for market risk positions and operational risks scaled with the factor 12.5) amounted to 6.1% as of 30 September 2009. On a pro-forma basis and as per the approved financial statements 2008 and after result distribution 2008, the core capital ratio amounted to 3.4% on 31 December 2008. * The own funds ratio (incl. risk-weighted credit risk positions as well as the capital requirements for market risk positions and operational risks scaled with the factor 12.5) amounted to 8.0% as of 30 September 2009. On a pro-forma basis and as per the approved financial statements 2008 and after result distribution 2008, the comparable figure was 5.7% on 31 December 2008. Contact: Kontakt: Herr Walter Allwicher +49 (0)89 2880 28 787 Herr Oliver Gruß+49 (0)89 2880 28781 11.11.2009 Financial News distributed by DGAP. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------------- Language: English Company: Hypo Real Estate Holding AG Freisinger Strasse 5 85716 Unterschleissheim Deutschland Phone: +49 (0)89 2880 28 291 Fax: +49 (0)89 2880 22 28 201 E-mail: irfo@hyporealestate.com Internet: www.hyporealestate.com ISIN: DE0008027707, DE000A0XFS34, DE000A0Z1JJ5 WKN: 802770, A0XFS3, A0Z 1JJ End of News DGAP News-Service ---------------------------------------------------------------------------
Aktuelle News
Aktuelle Berichte
Anstehende Events
Keine Events gefunden
Webcasts
Keine Webcasts gefunden