WestImmo, the German property bank which is being bought by Aareal, has posted a profit after tax of €64.1m for 2014, up 27% from the previous year.
WestImmo ceased originating new business over two years ago due to restrictions imposed by the European Commission in connection with government measures to stabilise the former WestLB Group.
Since then, it has renewing existing loans and managing its cover assets for Pfandbriefe pools. In 2014, it extended €800m of commercial real estate loans in the amount of €0.8 billion (previous year: €1.2 billion).
Over 2014, €450m of assets that were “inconsistent with its strategy as a traditional Pfandbrief bank” were carved out and transferred to its owner, bad bank Erste Abwicklungsanstalt. The €350m sale to Aareal is expected to close by mid-2015 and the plan is to establish a short financial year for the first half of 2015 and to transfer another €400m of portfolios to EAA.
WestImmo’s real estate loanbook was €5.2bn at end-2014, down from €8.2bn the previous year. The biggest exposure, 28%, was in Germany with the international lending spread over 17 countries. Of the latter, the largest chunk was 15% in the UK (see chart below). “Other”, which accounted for 26% of the loanbook,was spread over various western and eastern European countries. On sector, offices accounted for half the loanbook.