|1 Jan - 31 Mar 2020||1 Jan - 31 Mar 2019|
|Operating profit (€ mn)||11||61|
|Consolidated net income (€ mn)||7||40|
|Consolidated net income allocated to|
ordinary shareholders (€ mn)1)
|Cost / income ratio (%)2)||58.3||64.5|
|Earnings per ordinary share (€)1)||0.04||0.59|
|RoE before taxes (%)1) 3) 4)||0.7||8.8|
|RoE after taxes (%)1) 3) 4)||0.4||6.0|
|31 Mar 2020||31 Dec 2019|
|Statement of financial position|
|Property finance (€ mn)5)||25,348||25,882|
|Equity (€ mn)||2,856||2,861|
|Total assets (€ mn)||40,968||41,137|
|Risk-weighted assets (€ mn)||11,463||11,195|
|Common Equity Tier 1 ratio (CET1 ratio) (%)||20.2||19.6|
|Tier 1 ratio (T1 ratio) (%)||22.8||22.3|
|Total capital ratio (TC ratio) (%)||30.3||29.9|
|Common Equity Tier 1 ratio (CET1 ratio) (%) – Basel IV (estimated)7)||14.2||13.5|
|Bank deposit rating||A3||A3|
|Mortgage Pfandbrief Rating||Aaa||Aaa|
|Issuer default rating||BBB+||A-|
|Senior Non Preferred||BBB+||A-|
|ISS-ESG||prime (C+)||prime (C+)|
1)The allocation of earnings is based on the assumption that net interest payable on the AT1 bond is recognised on an accrual basis.
2) Structured Property Financing and Consulting/Services Bank (formerly: Bank division Housing Industry) segments, in line with the strategic development; the previous year's figure was adjusted accordingly.
3) On an annualised basis
4) ”Other reserves” were included in equity, in line with the further development of segment reporting; the previous year's figure was adjusted accordingly.
5) Excluding € 0.4 billion in private client business (31 December 2019: € 0.4 billion) and € 0.3 billion in local authority lending business by the former Westdeutsche Immobilien-Bank AG (WestImmo) (31 December 2019: € 0.4 billion)
6) When calculating own funds as at 31 December 2019, annual profits for 2019 were taken into account, based on the proposal by the Management Board and the Supervisory Board for appropriation of profits for the 2019 financial year, and incorporating the pro-rata accrual of net interest payable on the AT1 bond. Following a request issued by the European Central Bank, dated 27 March 2020, to refrain from paying out any dividends at least until 1 October 2020 due to the Covid-19 pandemic, and having conducted a detailed review, the Management Board and the Supervisory Board decided to propose to the Annual General Meeting that no dividends be distributed for the 2019 financial year, as an exceptional measure to strengthen the Bank’s capital base, and that net retained profit be transferred in full to other retained earnings. Accordingly, annual profits for 2019 were once again included for the purpose of determining regulatory capital as at 31 March 2020. The appropriation of profits is subject to approval by the Annual General Meeting. When calculating own funds as at 31 March 2020, interim profits for 2020 were taken into account, deducting the pro-rata dividend in line with the dividend policy, and incorporating the pro-rata accrual of net interest payable on the AT1 bond. The expected relevant impact of the TRIM exercise on commercial property financings, and of the SREP recommendations concerning the NPL inventory as well as the ECB's NPL guidelines for exposures newly classified as NPLs, were taken into account for determining regulatory indicators. The CET1 ratio, as shown in Aareal Bank’s regulatory report as at 31 March 2020, was 19.5 %, reflecting the fact that on that date the Bank had not submitted an application for inclusion of profits to the ECB.
7) Underlying estimate, given a 72.5 % output floor based on the final Basel Committee framework dated 7 December 2017. The calculation of the material impact upon Aareal Bank is subject to the outstanding EU implementation as well as the implementation of additional regulatory requirements (CRR II, EBA requirements etc.).
8) Moody's Investors Service confirmed the issuer rating and bank deposit rating on 21 April 2020. At the same time, Moody’s set the outlook for the issuer rating and bank deposit rating to ”negative”, given deterioration in the operating environment on account of the Covid-19 pandemic.
9) The ratings reported as at 31 December 2019 were published on 10 January 2020. In the context of the introduction of revised bank rating criteria, Fitch Ratings had set the outlook to ”negative”. On 27 March 2020 the rating was changed, as expected. Due to the Covid-19 pandemic, Fitch Ratings lowered its rating outlook to negative (RWN – Rating Watch Negative), also on 27 March 2020.
10) Please refer to our website (www.aareal-bank.com/en/responsibility/reporting-on-our-progress/) for more details.
This report contains rounded numbers, which may result in slight differences when aggregating figures and calculating percentages.