Pbb Deutsche Pfandbriefbank originated €10.5 billion of new business during 2016, its second highest annual volume since it resumed lending in 2009.
Last year’s total new business, which also includes loan extensions of more than one year, was down €1.5 billion from 2015’s total of €12 billion. The bank said that it increased its average gross margins on new lending, while applying the same high risk standards.
Pbb is aiming to lend between €10.5 billion and €12.5 billion during 2017, which it expects to be achieved partially through new business generated in the US, as well as from public investment finance and stabilised pre-payments.
The German bank reported a surge in consolidated pre-tax profits, rising 54 percent from €195 million in 2015 to €301 million, which it attributed to core solid business and “extraordinary income” through the release of write-downs, including extraordinary income of €132 million related to claims against Austrian bad bank Heta Asset Resolution.
Overall, pbb said that 2016 was its best result since it resumed business in 2009.
The bank’s operating business remained stable, with a slightly reduced net interest income of €404 million, from €426 million in 2015, offset by continuously low loan loss provisions and reduced general administrative expenses.
Looking forward, the bank predicted pre-tax profit of €150-170 million for 2017, in line with adjusted 2016 pre-tax profit.
“2016 was a good year for pbb and an extraordinary effect turned it into a very good year. The current financial year will not be any less challenging – taking into consideration impending regulatory changes, as well as the competitive situation. We intend to continue with our conservative approach to risk, whilst making prudent investments in new projects and business segments,” said pbb’s CEO/CFO Andreas Arndt.