Frankfurt am Main, 14 August 2019 – For ProCredit
Holding AG & Co. KGaA (ProCredit Holding) and the ProCredit banks, which
are primarily active in South-Eastern and Eastern Europe, the first half of the
2019 financial year was in line with the company’s expectations. Positioned in
its markets as the Hausbank for small and medium-sized enterprises
(SMEs), the ProCredit group’s gross loan portfolio from its continuing operations
has grown by a solid EUR 217m (+5%) to EUR 4.6bn since the beginning
of the year.
In lending, the group focuses on the sustainable
financing of investments by innovative, high-growth SMEs with stable and
formalised structures. Particular emphasis is placed on promoting green
investments, financing local production and strengthening the agricultural
sector. 93% of outstanding ProCredit group loans are to businesses.
At the end of Q2 2019, the volume of customer deposits
in the continuing operations amounted to EUR 3.9 bn. This represents
an increase of EUR 63m (1.7%) compared with the previous year. Deposits from
private customers also increased, reversing a decrease in 2018, reflecting
positive developments with the execution of the group’s digital ProCredit
DIRECT strategy.
Due to the portfolio growth, net interest income
recorded an increase in the first half of 2019 to EUR 92.7m (H1 2018: EUR
92.1m). At 3.1%, the net interest margin at the end of Q2 2019 was stable at
the same level as at the end of Q1, laying the foundation for increased net
interest income with future portfolio growth.
Expenses for credit risk provisions increased year on
year to EUR 4.1m in the first half of 2019 (H1 2018: EUR -0,1m). Overall, however,
portfolio quality improved further in the first half of 2019. At 2.9%, the
share of non-performing loans in the total loan portfolio of the continuing
operations showed a slight improvement on the already good level recorded at
the end of the previous year (31 December 2018: 3.1%). The risk coverage ratio
also improved during the first half of 2019, from 90.8% on 31 December 2018 to
94.9% on 30 June 2019. At 0.1%, net write-offs in the first half of 2019
remained at their usual very low level.
Net fee and commission income grew by EUR 1.8m (7.4%) to
EUR 25.8m (H1 2018: 24.0m). This increase is primarily the result of the
ProCredit group implementing its direct banking strategy.
The increase in operating expenses by EUR 2.1m to EUR
83.5m (H1 2018: EUR 81.4m) was mainly due to spending on marketing activities
in connection with the introduction of ProCredit DIRECT.
The result from discontinued operations of EUR -1.5m
mainly comprises the anticipated losses from the planned sale of ProCredit Bank
Colombia, which is currently awaiting the approval of the Colombian
authorities.
The ProCredit group’s total consolidated result for
the first half of 2019 amounted to EUR 22.9m. This was EUR 3.8m lower
than the previous year (H1 2018: EUR 26.7m), which is broadly in line with
expectations.
At 70.7%, the cost-income ratio of the ProCredit group
for the first half of 2019 in its continuing operations was slightly above the
previous year’s level (H1 2018: 70.2%). The Common Equity Tier 1 capital ratio,
which stood at 14.3%, on 30 June 2019, was at the same level as at year-end
2018.
The group’s “green portfolio” continued to show strong
growth in the first half of 2019, increasing by EUR 34m to EUR 711m.
It now accounts for 15.6% of the total loan portfolio. This underlines the
great importance the group places on financing its clients’ green and
sustainable investments.
Thanks to its strong market positioning with SMEs in South-Eastern and
Eastern Europe, during the course of financial year 2019 the ProCredit group
has been able to conclude further cooperation agreements with international
institutions whose
mandate includes the sustainable promotion of SMEs in these regions.
In July 2019 the cooperation with the European Investment Fund (EIF) to
promote lending to innovative SMEs in Eastern and South-Eastern Europe through
the InnovFin guarantee programme was expanded by an additional EUR 800m,
bringing the total volume to EUR 1.6bn. This will support the ProCredit
group’s ambitions to grow its target SME loan portfolio in an efficient manner
regarding risk weighted assets, whilst providing high quality collateral.
In May 2019 an agreement was signed with the World Bank’s International
Financial Corporation (IFC) to place USD 90m in green bonds. The agreement
sets a milestone in the financing of SME green investments in Eastern Europe in
the fields of energy efficiency, renewable energy and environmentally friendly
measures (“green loans”).
The company’s management reconfirms its forecast of
10–13% growth of the gross loan portfolio for the year as a whole. The group
also reiterates its forecast of a cost-income ratio of below 70% and a
consolidated result of between EUR 48m and EUR 55m. It is expected
that the Common Equity Tier 1 capital ratio (CET1 fully loaded) will continue
to exceed 13%.
The group’s half-year report is available
from today in German and English on the ProCredit Holding website under
Investor Relations at: https://www.procredit-holding.com/investor-relations/reports-and-publications/financial-reports/.
Contact:
Andrea Kaufmann, Group Communications, ProCredit
Holding,
Tel.:
+49 69 951 437 138, e-mail: Andrea.Kaufmann@procredit-group.com
Elma Čavčić, PR and Marketing Specialist, ProCredit Bank,
Tel: +387 62 841 246, e-mail: E.Cavcic@ProCreditBank.ba
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 superordinated 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 which refer to our future
business operations and future financial performance parameters, as well as to
future events or developments relating to ProCredit Holding, and which could be
regarded as forward-looking statements. Such statements are based on present
expectations and certain assumptions on the part of the Management of ProCredit
Holding. They are therefore subject to numerous risks, uncertainties and
contingencies, many of
which lie outside ProCredit Holding’s control. If one or several of these risks
or uncertainties should materialise, or if it should transpire that the
underlying expectations are not fulfilled or the assumptions were not correct,
then the actual results, performance and success of ProCredit Holding may
differ in a materially positive or negative manner from those results that were
explicitly or implicitly mentioned 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.