In the third quarter of 2004, Bouwfonds showed a good performance compared with the third quarter of 2003. Revenues improved by 8.8% to € 161 million. Compared with the second quarter, net interest revenue increased 9.2% to € 107 million.
Revenues improved by 8.8% to € 161 mln. This was driven by a strong increase in net interest revenue on the back of higher margins and volumes in residential mortgages and property finance. Net commissions declined € 6 mln as a result of a reclassification between the commission line and the other revenue line in the third quarter of 2004. Other revenue declined 5.1% due to lower income from property development activities. Operating expenses were up € 4 mln, or 6.2%, due to higher staff costs, following an increase in FTEs to support the growth of the business. Consequently, the operating result improved by 10.8% to € 92 mln and the efficiency ratio improved by 1.0 percentage point to 42.9%.
Compared with the second quarter, net interest revenue increased 9.2% to € 107 mln as a result of the continued favourable interest rate environment for mortgages. This increase partly offset the decrease in net commissions and in other revenues. Compared with the previous quarter, net commissions went down € 12 mln. The decrease is related to the above-mentioned reclassification. Other revenues declined due to a slower third quarter in property development as a result of the holiday period and the absence of the profit on a commercial development project in Belgium as reported in the second quarter. Consequently, total revenue for the third quarter of 2004 was down 6.4% to € 161 mln.
Operating expenses went up by 3.0% to € 69 mln as a result of higher information technology costs.
Consequently, the operating result decreased by 12.4% to € 92 mln and the efficiency ratio increased 3.9 percentage points to 42.9%.
Compared with the second quarter, provisions were down € 6 mln due to the release of provisions.
In the absence of the one-off tax credit reported in the second quarter, net profit in the third quarter decreased by 20.7% to € 65 mln.
On 15 July 2004, Bouwfonds announced that it reached an agreement on the acquisition of all the shares in MAB Group BV. The completion of the transaction is expected to take place before the end of this year.
Source: ABN AMRO