DGAP-News

Erste Abwicklungsanstalt: EAA successfully continues with portfolio reduction - Seite 2

The wind-up portfolio is now notionally smaller and of better quality than originally planned. At the same time, the EAA's reserves are higher than they were expected to be at this time. Its equity as of 31 December 2020 amounted to around EUR 654 million. The buffer made up of equity, equity capital drawing facility and risk provisions has improved steadily relative to the remaining portfolio to around EUR 1.6 billion as of 31 December 2020. At the same time, the risk assessment for the remaining portfolio improved.

The EAA has already made it clear on several occasions that its interest-bearing business would inevitably shrink as the winding up progressed, and that costs could no longer be reduced in proportion to the shrinking portfolio. However, the economic losses in 2020 were significantly lower than expected. The net interest result was EUR 23.8 million higher than in the previous year, mainly due to the one-off effect from the profit transfer of a subsidiary.

General administrative expenses fell by EUR 10.7 million year on year to
EUR 125 million. Compared with 2012 (the year of the second portfolio transfer to the EAA) costs were reduced by around 70%.

In the past fiscal year, the EAA pressed ahead with projects to optimise and increase the flexibility of administrative expenses to ensure that it is in an efficient and cost-effective position for the remaining tasks. "We are currently creating the conditions for the EAA to focus on its core functions and to be able to draw on a flexible service landscape in the medium term", explains EAA Managing Board member Christian Doppstadt. "These measures form the basis for us to successfully continue with our mandate of winding up while minimising risks and preserving value", Doppstadt emphasises.

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The EAA is a financially and organisationally independent public law institution. It was established in 2009 with a view to helping stabilise the financial markets. In accordance with its charter, its mission is to wind up risk positions taken over from the former WestLB in such a way as to minimise losses.