EQS-News

Results of IKB Deutsche Industriebank AG for the first half of 2023: solid corporate customer business in a demanding environment - Seite 3

IKB's loan book is resilient and benefited from the conservative risk policy. Net risk provisioning in the first half of the 2023 financial year remained low, totalling €12 million (prior year: €0 million). The additional portfolio loan loss allowance of €12 million as of 31 December 2022 has not been utilised so far. The ratio of non-performing loans (based on the EBA definition) of 1.8% (prior year: 1.8%) was stable at a very low level. Portfolio loan loss allowances and specific allowances on the books totalled €139 million (31 December 2022: €138 million).

Net other income in the reporting period amounted to €9 million and was primarily driven by €31 million in income from derivative positions. On the opposite, write-downs in securities held for sale resulted in expenses of €11 million.

In the first six months, the cost/income ratio improved to 66% from 72% in the prior year. The return on equity rose from 6.2% to 7.9% (based on a fully phased CET 1 ratio of 12% relative to average risk-weighted assets). The net interest margin on loan book grew from 1.77% last year to 2.13%.

 

Resilient loan book

IKB's €9.3 billion loan book largely consists of loans granted to German mid-cap enterprises, companies with minimum annual revenues of €100 million, good credit ratings and diversification across regions and products. Over half of the loan book is maturity match-funded by the KfW banking group and other development banks.

 

Solid equity and liquidity position

The CET 1 ratio (fully phased) stood at 15.7% for the IKB Group as of 30 June 2023 and was significantly above the 14.5% recorded as of 31 December 2022. The reason for the increase was the development of the risk-weighted assets, which was driven by better-than-planned credit ratings in new business and stable credit ratings of existing loans on the book as well as the profit achieved in the current half year. Corporate and private customer deposits totalled €4.2 billion (31 December 2022: €4.1 billion). In sum, 85% of deposits are protected by German deposit protection schemes (EdB and ESF). Furthermore, the free available liquidity reserve of €1.3 billion gives IKB a comfortable liquidity position. The IKB Group's leverage ratio of 6.4% clearly exceeds the statutory minimum ratio.