- Measures to strengthen the Group in the long-term impact - Income growth at Sachsen LB (Bank) - Further improvement in cost-income ratio
Sachsen LB has started the 2006 financial year with satisfactory results. As the newly published half-year figures show, the Group generated an operating result before risk provisions and restatements of ¤67.6 million (p.y: ¤69.4 million). The operating result at Sachsen LB (Bank) increased by ¤8.8 million year-on-year to ¤67.5 million (p.y.: ¤58.7 million). The Bank's cost-income ratio improved to 38.07% (p.y: 43.77%).
"Sachsen LB is thus on target with regard to implementing strategic initiatives. The cost and income measures to strengthen the bank and the Group in the long-term are impacting," said the Chief Executive Officer, Herbert Süß. The bank is thus "on the right track in terms of both quality and quantity", particularly in light of the strategic restructuring. "Following completion of the fundamental restructuring and reorganisation, we are now focussing on expanding our market position in the long-term and on strengthening sales in the specific core areas of business", said Süß.
Sachsen LB and Sachsen LB Europe carry results Sachsen LB and Sachsen LB Europe plc in Dublin are the key contributors to the Group results and there was positive development in their income situations.
Sachsen LB (Bank) generated total operating profit before risk provisions and restatements of ¤67.5 million, which is considerably higher than the ¤58.7 million generated in the first half of 2005. Income from interest, investments, commission and trading totalled ¤107.6 million compared to ¤103.4 million in the previous year. At ¤110.7 million, interest income was lower than the previous year (p.y.: ¤114.4 million) and net commission income was higher than the previous year at ¤-7.1 million (p.y.: ¤-7.8 million). There was a considerable increase in trading income at Sachsen LB, which increased from ¤-3.2 million in the first half of the previous year to ¤4 million.
Administrative expenses decreased to ¤-41.5 million (p.y.: ¤-45.7 million). Personnel expenses amounted to ¤-14.9 million (p.y: ¤-15.8 million) and other administrative expenses including fixed-asset depreciation totalled ¤-26.6 million (p.y: ¤-29.9 million). Sachsen LB (Bank) is one of the top state banks with a cost-income ratio of 38.07% (p.y.: 43.77%).
Other operating result increased to ¤1.4 million (p.y.: ¤1 million) in the reporting period.
Satisfactory Group results Interest income was ¤89.4 million (p.y.: ¤102.6 million) within the Group. Net commission income was ¤14 million, corresponding to a slight increase from the previous year (p.y.: ¤12.1 million). At ¤3.8 million, there was a shift in trading income compared to the previous year (¤-2.9 million).
Administrative expenses in the Sachsen LB Group were down by 10.9% compared to the previous year to ¤-57.8 million (p.y.: ¤-64.9 million) in the first half of 2006. Sachsen LB has thus made considerable progress in reducing costs. Personnel expenses totalled ¤-25.1 million (p.y.: ¤-26.8 million). Other administrative expenses including fixed-asset depreciation amounted to ¤-32.7 million (p.y.: ¤-38.1 million). At ¤18.2 million, other operating results in the Group were lower than the previous year's level of ¤22.5 million.
The Sachsen LB Group thus posted an operating result before risk provisions and restatements of ¤67.6 million (p.y.: ¤69.4 million) in the first half-year.
Balance sheet total at previous year's level The bank's balance sheet increased from ¤62.4 billion as at 31 December 2005 to ¤62.6 billion as at 30 June 2006. The Group balance sheet total was ¤68.6 billion as at 30 June 2006, compared to ¤68.4 billion as at 31 December 2005.
The overall equity ratio in accordance with the German Banking Act was 12% as at 30 June 2006 and was thus considerably higher than the minimum requirements set by the banking supervisory authorities.
The bank had 350 employees, including trainees, as at 30 June 2006. The Group had 593 employees.
Contact for questions: Jeannette Brakemeier, Sachsen LB Communications - Investor Relations, Telephone 0341 979-1127, Fax 0341979-1109 e-mail [email protected]
Sachsen LB (Bank) results for HY1 2006
Key financial results 1 HY 2006 1 HY 2005 Change m EUR m EUR m EUR in % Operating income 107.6 103,4 4,2 4,1 including: Interest income 110.7 114.4 -3.7 -3.2 Net commission income -7.1 -7.8 0.7 9 Trading income 4 -3.2 7.2 >100
Administrative expenses -41.5 -45.7 4.2 9.2 including:
- Personnel expenses -14.9 -15.8 0.9 5.7 - Other administrative -26.6 -29.9 3.3 11 expenses (including depreciation)
Other operating income/expenses 1.4 1 0.4 40
OPERATING RESULT Sachsen LB 67.5 58.7 8.8 15 (Bank) Before risk provisions/restatements
Sachsen LB Group results for HY1 2006
Key financial results 1 HY 2006 1 HY Change 2005 m EUR m EUR m EUR in % Operating income 107.2 111.8 -4.6 -4.1 of which: Interest income 89.4 102.6 -13.2 -12.9 Net commission income 14 12.1 1.9 15.7 Trading income 3.8 -2.9 6.7 >100
Administrative expenses -57.8 -64.9 7.1 10.9 of which: - Personnel expenses -25.1 -26.8 1.7 6.3 - Other administrative -32.7 -38.1 5.4 14.2 expenses (including depreciation) Other operating income/expenses 18.2 22.5 -4.3 -19.1
OPERATING RESULT Sachsen LB 67.6 69.4 -1.8 -2.6 Group Before risk provisions/restatements
