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26th August 2011

LBBW recovery on track

Landesbank Baden-Württemberg reported first half net attributable of €375m (£329m $541m ¥41.4bn Y3,458m)compared with a year ago LOSS of €288m.


The biggest positive turnaround was trading income moving from an €809m LOSS a year go to a €428m profit. Unfortunately some of this benefit was lost by a reversal in investment securities moving from a €136m profit to a LOSS of €321 mainly due to a charge for future Greek bond losses. The bank gained from a significant reduction in loan losses. Being back in the black also meant having to pay taxes compared with a year ago tax reversal.


Core Tier 1 exceeds 13% and will not therefore require any further increases for some time to come.


Income Summary Half Year 2011 2010 Change
€m €m %
Net interest income 1,203 1,257 – 4.3
Allowance for losses on loans and advances – 84 – 297 – 71.7
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Net interest income after allowance for loan losses 1,119 960 16.6
Net fee and commission income 272 316 – 13.9
Net loss from hedging transactions - 17 – 24 – 29.2
Net trading income/loss 428 – 809 -–
Financial instruments change in fair value 49 123 – 60.2
Net income/loss from investment securities – 321 136 -–
Investments accounted for using the equity method – 3 – 11 – 72.7
Net income from investment property 67 54 24.1
Administrative expenses – 861 – 877 – 1.8
Other operating income 36 19 89.5
Net loss from profit and loss transfer agreements 0 – 1 --
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Operating profit 769 – 114 -–
Goodwill impairment – 15 0 -–
Restructuring expenses – 1 – 54 – 98.1
Guarantee or coemmmbiessrgio1n Baden-Württemberg – 152 – 153 – 0.7
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Consolidated profit before tax 601 – 321 --
Income tax – 225 31 --
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Consolidated profit 376 – 290 -–
Loss/profit attributable to minority interests – 2 3 -–
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Attributable to shareholders 375 – 288 -–