DGAP-Adhoc

GRENKE AG: GRENKE informs about exonerating statements and points of criticism of BaFin's special auditor - Seite 2

In addition to the exonerating statements, Mazars' report also contains significant points of criticism. For example, Mazars considers it necessary to consolidate the franchise companies. The report also criticised the failure to disclose related parties in previous annual financial statements, the procedure of parts of GRENKE Bank's customer lending business, and the money laundering prevention process. The report also contains the already known findings in the areas of internal audit and compliance.

GRENKE AG has already responded in the past weeks and months to material findings from the ongoing audits. Meanwhile, GRENKE has started to make relevant further improvements in its internal processes, expanded its Board of Directors to include a chief risk officer, and structured departmental responsibility more clearly, among other things. Following the resignation of Board of Directors member Mark Kindermann, the Supervisory Board intends to strengthen the Board of Directors.

Already in October last year, the Board of Directors announced its intention to terminate the franchise model and integrate the franchise companies into the Group. With the planned takeover of the franchise companies under company law, the company will terminate all business relations with CTP Handels- und Beteiligungs GmbH and the other financial investors.

The following detailed information from Mazars represents an interim status. The final report on the commissioned special audit is still pending.

No indications of money laundering

According to Mazars, the allegation of money laundering has not been confirmed. Mazars thus confirms the interim results of the ongoing audit by the auditing firm KPMG, which GRENKE had reported on in December 2020.

However, Mazars considers GRENKE AG's internal control measures regarding money laundering prevention to be not effective in certain areas and that the material and personnel resources of the money laundering officer show substantial deficiencies.

No doubts as to the existence of the leasing business

According to Mazars, there are no doubts as to the existence of the leasing business, which constitutes GRENKE's core business with leasing receivables of EUR 5.6 billion. This finding also confirms the interim results of the ongoing KPMG audit from December 2020.