Commerzbank AG / Quarter Results/Interim Report
06.05.2010 07:08
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.
---------------------------------------------------------------------------
Commerzbank in Q1 with an operating profit of EUR 771 m
- Net profit with EUR 708 m clearly positive
- Core capital ratio (Tier 1) at 10.8% remains at a high level
- Gross revenues rise to EUR 3.6 bn (plus 56% year-on-year)
- Blessing: 'We have reached another milestone on the path to full
profitability'
Commerzbank has made a successful start to the financial year 2010 with a
first-quarter operating profit of EUR 771 million (Q1 2009: minus EUR 595
million). With customer-oriented business picking up, reduced loan loss
provisions and markets showing a positive trend, gross revenues increased
by 56% year-on-year to EUR 3.6 billion. The net profit (after minority
interests) was EUR 708 million (Q1 2009: minus EUR 864 million). The core
bank, comprising the segments Private Customers, Mittelstandsbank, Central
& Eastern Europe (CEE) and Corporates & Markets (C&M), operated profitably.
For the months of January to March, Asset Based Finance (ABF) and the
Portfolio Restructuring Unit (PRU) also posted an improved result and an
operating profit respectively. 'We have not yet reached our targets, but
the positive result shows that we are on the right track with 'Roadmap
2012'. We have significantly improved our operating performance, thereby
reaching another key milestone on the path to full profitability', said
Martin Blessing, Chairman of the Board of Managing Directors of
Commerzbank. 'The core bank will close 2010 with an operating profit as
planned. By 2011 at the latest we will once again be profitable at group
level. In 2012, we will be fully profitable with an operating result of
more than EUR 4 billion.'
Despite the sale of subsidiaries and the further reduction of assets, net
interest income year-on-year increased by 12% to just under EUR 1.9
billion. Net commission income improved by 16% to EUR 983 million. This was
mainly due to growth in the securities activities of Commerzbank customers,
from which trading profit also benefited (EUR 850 million, Q1 2009: minus
EUR 527 million). Impairments on structured products (ABS portfolio) in
particular caused a decline in net investment income to minus EUR 119
million (Q1 2009: EUR 386 million). Loan loss provisions fell by 24%
year-on-year and by 51% quarter-on-quarter to EUR 644 million. The decrease
also reflects the improved financial situation of many Commerzbank
customers. Although the Dresdner Bank integration resulted in expenses of
EUR 120 million during the first quarter, operating expenses were reduced
to EUR 2.2 billion (minus 8% compared to Q4 2009). Adjusted, the costs were
also down year-on-year (minus 5%), which also confirms the expected
synergies. The number of customers is stable at 15 million, of which
approximately 11 million are in the Private Customers segment and some 3.9
million in the CEE segment (Q4 2009: 3.7 million).
'Overall, the first quarter of 2010 went better than originally
anticipated. We have made considerable operational progress in all areas.
This shows the successes achieved in implementing the 'Roadmap 2012', which
were also supported by the market recovery. In addition, we saw
increasingly positive effects from the Dresdner Bank integration', said
Eric Strutz, Commerzbank's Chief Financial Officer. In the first quarter
the bank reduced its total assets to EUR 846 billion (minus 16% compared to
Q1 2009). Risk-weighted assets came at EUR 279 billion. At the end of March
2010, the core capital ratio (Tier 1) with 10.8% remained at a high level.
Including the first-quarter profit, the core capital ratio is 11.0%.
Successful customer business, loan loss provisions reduced
Due to the sale of subsidiaries the figures for 2010 in the Private
Customers segment are not directly comparable with the previous year. In Q1
2010 an operating profit of EUR 28 million (Q1 2009: EUR 42 million) was
reached. The decline of the net interest income by EUR 56 million to EUR
497 million is accompanied by an increase in net commission income (plus
EUR 35 million to EUR 545 million). The Mittelstandsbank generated an
operating profit of EUR 302 million (Q1 2009: EUR 320 million). Net
interest income was down by 6% compared to Q1 2009, since - as in the
Private Customers segment - deposit volume und deposit margins have been
reduced due to the generally low interest rate level. The decline was also
in Mittelstandsbank seen alongside a rising net commission income (plus 8%
to EUR 257 million). In spite of charges relating to Bank Forum in the
Ukraine, CEE posted an operating profit (EUR 6 million, Q1 2009: minus EUR
62 million).
Loan loss provisions fell significantly especially compared to Q4 2009. In
the Private Customers segment, they were at EUR 66 million (Q4 2009: EUR 72
million). At Mittelstandsbank and in CEE they were down from EUR 298
million in the previous quarter to EUR 161 million and from EUR 296 million
to EUR 94 million respectively. Operating expenses in the Private Customers
segment lowered significantly by EUR 57 million to EUR 913 million
year-on-year. In the Mittelstandsbank they increased by 8% to EUR 357
million, especially due to one-off integration-related expenses. In the CEE
segment, operating expenses rose by 11% to EUR 126 million year-on-year;
however, adjusted for currency effects they remained stable.
Capital markets business benefits from strategic realignment and improved
economic environment
Corporates & Markets achieved an operating profit of EUR 339 million in the
traditionally strong first quarter (Q1 2009: EUR 43 million). Customer
business, particularly in Fixed Income & Currencies and Equity Markets &
Commodities, contributed to the increase in trading profit to EUR 449
million (Q4 2009: minus EUR 124 million). The Corporate Finance area also
had a very good start into the year 2010. Loan loss provisions came in at
minus EUR 254 million in Q1 2009. In Q1 2010 they were plus EUR 19 million,
reflecting a net reversal of loan loss provisions. Operating expenses fell
from EUR 500 million to EUR 411 million thanks to the realization of cost
synergies.
In the ABF segment net interest income was significantly up by 15% to EUR
296 million year-on-year, due to improved margins. Net commission income
was EUR 88 million, up from EUR 63 million year-on-year. However, charges
from the US commercial real estate portfolios and still high loan loss
provisions - despite a significant decrease from EUR 651 million in Q4 2009
to EUR 325 million in Q1 2010 - resulted in an operating loss of minus EUR
86 million (Q4 2009: minus EUR 652 million). Operating expenses fell by EUR
16 million to EUR 152 million compared to Q1 2009.
In PRU, the recovery in the markets and returning liquidity were used to
manage down portfolios with an emphasis on value maximization. In the first
quarter, the segment posted a strongly improved operating profit of EUR 162
million (Q1 2009: minus EUR 1.4 billion). At the end of March, PRU managed
portfolios with net total assets of EUR 16.9 billion (minus 15% compared to
Q4 2009).
Outlook: 'Basis for the operational turnaround further strengthened'
'We have further strengthened the basis for the operational turnaround and
will continue to focus on enhancing our operating performance. Loan loss
provisions are down significantly and costs are developing according to
plan. The integration process is also proceeding as intended. In mid-June
we will begin switching the branches over to the new brand. Then the new
bank will become tangible for our customers', said Strutz. 'Cost synergies
in the current year will be at around EUR 1.1 billion and thus slightly
above plan. However, the economic environment remains fragile and the
possibility of setbacks cannot be excluded. One cannot extrapolate a good
first quarter to the entire year. That is why we are sticking to our
guidance: in 2010 as a whole, the group will only return to profit if the
economy and financial markets remain supportive.'
Excerpt from the consolidated profit and loss statement
in EUR m Q1 2010 Q1 2009 Change
Net interest income 1,888 1,692 12%
Loan loss provisions - 644 - 844 24%
Net commission income 983 850 16%
Trading result 850 - 527 -
Net investment income - 119 386 -
Other result 22 - 71 -
Operating expenses 2,209 2,081 6%
Operating profit 771 - 595 -
Impairments (goodwill) - -
Restructuring expenses - 289 -
Taxes 55 7 -
Consolidated result attributable to Commerzbank 708 - 864 -
shareholders
Cost/income ratio in operating business (%) 61.0 89.3 32%
*****
As a result of the takeover of Dresdner Bank completed on January 12, 2009
a direct comparison between the 2009 and 2008 figures is not possible. In
the interests of comparability, the segment results for 2009 include the
first eleven days of January, during which Commerzbank did not own Dresdner
Bank. All group figures relate to the period after the acquisition of
Dresdner Bank. A detailed reconciliation can be found at:
https://www.commerzbank.de/en/hauptnavigation/presse/archiv_/praesentation
en_1/praesentationen_2.html
*****
A telephone conference call will be held at 10:30 a.m. (CEST) on Thursday,
May 6, 2010. In the call, Dr. Eric Strutz will comment on business
performance in the first quarter of 2010. It will begin at 10:30 a.m. and
last about 45 minutes. Please dial +49 (0)30 86871 703 approx. 10 minutes
before the scheduled starting time. A presentation is expected to be made
available at www.commerzbank.de/praesentationen from 7:00 a.m. At that time
you should also be able to access broadcast-quality video and audio
material, including an interview with Dr. Eric Strutz on the Q1 figures, at
www.tvservicebox.de or www.directradio.de.
Contact:
Commerzbank AG
Group Communications
Tel.: +49 69 136 - 22830
mediarelations@commerzbank.com
06.05.2010 07:08 Ad hoc announcement, Financial News and Media Release distributed by DGAP. Medienarchiv at |[![CDATA[|[a href="http://www.dgap-medientreff.de"|]www.dgap-medientreff.de|[/a|]]]|] and |[![CDATA[|[a href="http://www.dgap.de"|]www.dgap.de|[/a|]]]|]
---------------------------------------------------------------------------
Language: English
Company: Commerzbank AG
Kaiserplatz
60261 Frankfurt am Main
Deutschland
Phone: +49 (069) 136 20
Fax: -
E-mail: ir@commerzbank.com
Internet: www.commerzbank.de
ISIN: DE0008032004
WKN: 803200
Indices: DAX, CDAX, HDAX, PRIMEALL
Listed: Regulierter Markt in Berlin, Frankfurt (Prime Standard),
Düsseldorf, München, Hannover, Stuttgart, Hamburg;
Terminbörse EUREX; Foreign Exchange(s) London, SIX
End of News DGAP News-Service
---------------------------------------------------------------------------
DGAP-News: Commerzbank in Q1 with an operating profit of EUR 771 m
| Source: EQS Group AG