DGAP-News: ProCredit Holding AG & Co. KGaA / Key word(s): Annual Results/Annual Results
ProCredit strengthens its market position with double-digit growth and achieves higher net profit in 2018
- Customer loan portfolio grows by 12.3% to EUR 4.4 billion in 2018, in line with expectations and significantly stronger than in the previous year (2017: 8.0%)
- Consolidated result for 2018 increases by 13.3% to EUR 54.5 million (2017: EUR 48.1 million)
- Implementation of direct banking concept contributes to a 13.9% increase in net fee and commission income to EUR 52.2 million (2017: EUR 45.8 million)
- Return on equity for 2018 increases within the forecasted range to 7.6%
- Dividend of EUR 0.30 per share will be recommended at the next Annual General Meeting
The growth of the loan portfolio was accompanied by a further improvement in portfolio quality. The share of non-performing loans in the total loan portfolio fell in the course of 2018 from 4.5% as at 31 December 2017 to 3.1% as at 31 December 2018. The risk coverage ratio for non-performing loans rose to 90.8% as of the balance sheet date (31 December 2017: 84.6%).
Green loans, which the ProCredit banks provide to support environmentally responsible investments, showed a positive development with a growth rate of 38.5%, thus outpacing the growth of the total loan portfolio. As at 31 December 2018, green loans accounted for 15.4% of the overall loan portfolio (31 December 2017: 12.6%).
The direct banking concept for private clients was fully implemented at all ProCredit banks in 2018 and is viewed as a very positive development for clients and for the group, as it has enabled significant cost savings. Furthermore, this development has helped to increase the net fee and commission income by 13.9% or EUR 6.4 million to EUR 52.2 million, which now represents 21% of total operating income. In 2018, the ProCredit group raised its deposit volume by EUR 255 million to EUR 3.8 billion, despite having streamlined its branch network.
The cost/income ratio improved by 3.4 percentage points in the financial year, falling to 70.2% from 73.6%in 2017. Compared to the same period in the previous year, staff and administrative expenses decreased by 8.0%, or EUR 14.9 million, to EUR 171.4 million.
The Common Equity Tier 1 capital ratio (CET1 fully loaded) increased from 13.7% as at end-2017 to 14.4% as at 31 December 2018, thus exceeding 13% as expected. ProCredit Holding's successful capital increase carried out in February 2018 had a significant influence on this ratio.
As in previous years, one third of the group profit is to be distributed to the shareholders. Therefore, a dividend payment of EUR 0.30 per share will be recommended at the Annual General Meeting on 17 May 2019.
With the expansion of its business with SMEs, the ProCredit group continues to focus on the development impact of its own activities. In terms of non-financial performance, the group makes a firm commitment to contribute to the UN Sustainable Development Goals (SDGs), as outlined in its comprehensive 2018 Impact Report published today. In the medium term, this includes increasing the share of green loans in the total loan portfolio to 20% and ensuring that the operations of the ProCredit group are CO2-neutral. The ProCredit group also intends to invest in additional staff training in order to further strengthen its already high level of social and environmental responsibility as an essential pillar of responsible banking.
The gross loan portfolio is expected to grow by 10% to 13% during the 2019 financial year. In the same period, the cost/income ratio is anticipated to be below 70% and the consolidated profit is expected to be between EUR 48 million and EUR 55 million. It is expected that the Common Equity Tier 1 capital ratio (CET1 fully loaded) will continue to exceed 13%.
The ProCredit Holding Annual Report 2018, the non-financial Impact Report 2018 and the Disclosure Report 2018 are available as of today in the Investor Relations section of the ProCredit Holding website at https://www.procredit-holding.com/investor-relations/reports-and-publications/
About ProCredit Holding AG & Co. KGaA
27.03.2019 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
|Company:||ProCredit Holding AG & Co. KGaA|
|60486 Frankfurt am Main|
|Listed:||Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Dusseldorf, Stuttgart, Tradegate Exchange|
|End of News||DGAP News Service|