Aareal Bank Group publishes nine-month results for 2005 (DE)

At €5 billion, Aareal Bank Group's new commitments during the first nine months of the current financial year exceeded the strong figure achieved in the first three quarters of 2004 by 23%. A rise of 59.8% was posted over the third quarter of 2004 alone.

The bank's strategic German business also gathered significant momentum during the period under review. The Management Board of Aareal Bank AG will be complemented when 51-year old Norbert Kickum joins the Board on 14 November, assuming responsibility for Aareal Bank's domestic and international market units. The bank's Supervisory Board had approved his appointment on 4 August 2005.

"The significant growth in new business, combined with broad international diversification, reflects the solid position of our domestic and international distribution network in the property markets we cover" says Dr. Wolf Schumacher, Chairman of the Management Board of Aareal Bank AG. "With Mr Kickum's appointment, the bank has gained a seasoned expert with international experience, who will expedite the new sales strategy and give fresh momentum to the bank's target business in Germany and abroad", he adds.

The revaluation of exposures, as a result of the extensive review of the credit portfolio, provides a solid foundation on which to reposition Aareal Bank AG for the 2006 financial year and beyond. It shapes the results and underlines the progress made in the bank's realignment process. Consolidated net loss for the first nine months of the 2005 financial year, after taxes and minority interest income, was €84 million (2004: loss of € 115 million).

Schumacher emphasised that the provisioning will give the bank room to quickly dispose of non-performing loans: "At the same time, the reduced level of risk provisioning (at around €80 – 90 million p.a.) will significantly enhance future profitability."

The resolved 10% capital increase, which was fully subscribed to by the shareholders of Aareal Holding Verwaltungsgesellschaft (excluding shareholders' preemptive subscription rights), provides the necessary foundation for a clear improvement in results.

Source: Aareal Bank

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