- Customer loan portfolio grows by 10.3%, customer deposits by 14.2%
- Consolidated result of EUR 54.3 million at the upper end of the forecast corridor
- Consolidated result also reflects expenses from the successfully completed restructuring measures that were planned at the beginning of the year
- Progress in achieving group-wide SDG targets published separately today in Impact Report 2019
Frankfurt am
Main, 26 March 2020 – The ProCredit group, which is mainly active in South
Eastern and Eastern Europe, recorded a successful financial year in 2019
overall. Growth in the customer loan portfolio of EUR 448 million or
10.3% was in line with targets (2018: EUR 482 million or 12.3%). The
consolidated result of EUR 54.3 million was at
the upper end of the forecast corridor and represents a return on equity of
6.9% (2018: EUR 54.5 million / 7.6%). The expenses incurred from the
restructuring measures planned at the beginning of 2019 were in line with
expectations and influenced the consolidated result.
For the ProCredit group, 2019 was a solid year
in which important milestones were reached and steady results achieved. Full
attention is now focused on the challenges that 2020 will bring for the group
and its customers, as well as on the economies and societies in the individual countries
in which we operate.
The EUR 448 million growths in
the loan portfolio achieved in the past financial year was complemented by a
further improvement in portfolio quality. Over the year, the share of
non-performing loans in the total loan portfolio declined by 0.6 pp to
2.5% (2018: 3.1%). At 89.1%, the coverage ratio remained at a healthy level and
was broadly similar to that of the previous year (90.8%).
Customer deposits increased by EUR 538 million
in the financial year (2018: EUR 255
million), outpacing the loan portfolio growth. This positive development was
driven by both business and private customers. The group’s liquidity position
was also reinforced by the placement of green bonds as well as other funding
initiatives. The liquidity coverage ratio (LCR) of 198% at the end of the year
substantiates the group’s sound liquidity position.
At EUR 54.3 million, the
consolidated result for 2019 was at the upper end of the forecast corridor. It
incorporates the anticipated negative effects from the sale of ProCredit Bank
Colombia (EUR –7.2 million), the completion of restructuring
activities at ProCredit Bank Albania (EUR –2.8 million) and the
goodwill write-down at ProCredit Bank Romania (EUR –2.0 million).
Moreover, additional expenses were incurred from the energy-efficient
modernisation of ProCredit Bank Kosovo’s office building (EUR –1.9 million). On the other hand, expenses for loss allowances dropped
by EUR 5.7 million in the last quarter of the year. This was due to a
further improvement in portfolio quality, inflows from written-off loans as
well as updating the parameters for the credit risk model. Overall, there was a
net release of EUR 3.3 million (2018: EUR 4.7 million) in
provisioning expenses during the financial year. The cost-income ratio at the
end of the financial year was 70.5%, slightly above the forecast target of 70%.
The group’s capital base was stable during the financial year. As expected, the
Common Equity Tier 1 capital ratio (CET1 fully loaded) was above 13% on 31
December 2019 and stood at 14.1%.
The ProCredit group remains committed to
making a meaningful contribution to development and therefore supports the UN’s
Sustainable Development Goals (SDGs).Further details and background information
were published today in the group’s comprehensive Impact Report. In 2019, the
green loan portfolio grew by 17.4% and at the end of the financial year
accounted for 16.6% of the total customer loan portfolio (2018: 15.4%). The
share of impaired loans in this rapidly growing portfolio was only 0.6% (2018:
0.7%). Moreover, the ProCredit group was able to reduce its own CO2
emissions by 19%. In the medium term, it is intended that the business
activities of the ProCredit group will be CO2-neutral and that a
green loans share of 20% in the overall portfolio can be achieved. In addition,
there will be continued investment in training for employees in order to
further strengthen their already high sense of social and ecological
responsibility.
developments with regard to the spread of COVID-19, the focus in 2020 will be
on the safety of employees and customers, proactive risk management and
customer support. The management considers the group’s overall situation to be
stable and sees the group’s primary task as providing customers with the
support they need: “The strategic initiatives of recent years form a good
foundation for meeting the challenges that lie ahead. Close relationships with
carefully selected customers at a reduced number of branches enables the group
to ensure efficient control of credit risks. Thanks to our tried and tested
digital banking platform, day-to-day customer business is not dependent on
physical presence and thus remains largely unimpaired. The exceptionally high
qualification levels of our staff, who have always been the focus of our
business strategy, also put us in an excellent position to meet and overcome
the challenges that lie ahead.”
Under the current circumstances, a
declining but positive return on equity is expected with a stable cost-income
ratio of approximately 70%. Growth in the customer loan portfolio is expected
to be more modest than in 2019, lying in the lower single-digit percentage
range. These forecasts are based on current assessments of the overall
situation, which may change in the coming days and weeks due to the very
dynamic developments surrounding the COVID-19 pandemic. Even in the event of a
widespread deterioration in the overall situation, and taking into account the
planned dividend payment of one third of consolidated profit for 2019, a Common
Equity Tier 1 ratio (CET1 fully loaded) of over 13% is still expected at the
end of 2020.
Given the ProCredit group’s clearly focused
business model, its close customer relationships and conservative risk
strategy, the Management Board continues to view the group’s medium-term
development positively and endorses the medium-term goals set.
The ProCredit group Annual Report 2019, the
non-financial Impact Report 2019 and the Disclosure Report 2019 are available
as of today in the Investor Relations section of the ProCredit Holding websitehttps://procredit-holding.com/investor-relations/reports-and-publications/
Contact:
Andrea Kaufmann, Group Communications, ProCredit Holding,
Tel.: +49 69 951 437 138, e-mail:
About ProCredit Holding AG & Co. KGaA
ProCredit Holding AG & Co. KGaA, based
in Frankfurt am Main, Germany, is the parent company of the
development-oriented ProCredit group, which consists of commercial banks for
small and medium enterprises (SMEs). In addition to its operational focus on
South Eastern and Eastern Europe, the ProCredit group is also active in South
America and Germany. The company’s shares are traded on the Prime Standard
segment of the Frankfurt Stock Exchange. The anchor shareholders of ProCredit
Holding AG & Co. KGaA include the strategic investors Zeitinger Invest and
ProCredit Staff Invest (the investment vehicle for ProCredit staff), the Dutch
DOEN Participaties BV, KfW Development Bank and IFC (part of the World Bank
Group). As the group’s super coordinated company according to the German
Banking Act, ProCredit Holding AG & Co. KGaA is supervised on a
consolidated level by the German Federal Financial Supervisory Authority
(Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin) and the German
Bundesbank. Further information is available on our website: www.procredit-holding.com
Forward-looking statements
This press release contains statements
relating to our future business development and financial performance, as well
as statements relating to future actions or developments affecting
ProCredit Holding which may constitute forward-looking statements. Such
statements are based on the management of ProCredit Holding’s current
expectations and specific assumptions, many of which are beyond the control of
ProCredit Holding. They are therefore subject to a multitude of risks,
uncertainties and factors. Should one or more of these risks or uncertainties
materialise, or should underlying expectations or assumptions prove incorrect,
then the actual results, performance and achievements (both negative and
positive) of ProCredit Holding may differ significantly from those expressed or
implied in the forward-looking statement. ProCredit Holding does not undertake
any obligation to update these forward-looking statements or to correct them in
the event of deviations from the expected development.