News on 09.09.2011

Dexia Kommunalbank Deutschland published its semi-annual report for the year 2011.

Dexia Kommunalbank Deutschland published its semi-annual report for the year 2011.

As in the previous year, Dexia Kommunalbank Deutschland focused its new lending in the first half of 2011 on the acquisition of selected public finance transactions from other Group companies (Group Asset Purchasing Programme) and on their longterm funding with public Pfandbrief issues. As part of its Group Asset Purchasing Programme, Dexia Kommunalbank Deutschland selected a portfolio of municipal loans with a total volume of 576.1 million EUR (June 30, 2010: 1,228.4 million EUR) from the pool of assets offered for acquisition by Group companies, of which 363.4 million EUR were loans to Belgian municipalities and 212.7 million EUR loans to municipalities in Sweden and Finland.

At the same time preparatory measures were taken to restart lending to German municipalities in the second half of 2011. This marks the end of the temporary suspension of domestic lending activities after the bank decided in 2009 to interrupt its own acquisition activities to support Dexia Group’s consolidation efforts within the framework of the transformation plan agreed with the European Commission. Dexia Kommunalbank Deutschland has focused on lending to German municipalities ever since it was founded. The Bank counts more than 1,000 German municipalities, with loans of approximately 9.7 billion EUR, in its customer base.

Dexia Kommunalbank Deutschland’s future new lending will be focusing on two sales channels

• new lending (loans and other financial services) to German municipalities that it originates itself and

• the acquisition of municipal loans originated by Group companies predominantly in the French and Belgian core markets.

Dexia Kommunalbank Deutschland thus acts as a pure municipal financing institution; the acquisition of public sector bonds is not part of the Bank’s core business (only for liquidity and cover pool management purposes).

For the purpose of long-term refinancing of the lending business, Dexia Kommunalbank Deutschland issued new public Pfandbriefe and borrower’s notes (SSD) for a total volume of 2,650.0 million EUR in the period (June 30, 2010: 4,079.5 million EUR). Public Pfandbrief issues account for 95.3 % of this volume.

Total assets fell slightly by 3.6 % to 46.9 billion EUR compared to the end of the previous year (31.12.2010: 48.7 billion EUR)..

Net interest income totalled 14.7 million EUR in the first half of 2011 and was under the previous year's figure (18.9 million EUR). Net income for the year remained at the same level of the first half of 2010 at 0.4 million EUR.

We are currently holding firm to the forecast for 2011 as published in the 2010 Annual Report and in addition to generating net profits in roughly the same amount as generated in 2010. We also expect the Bank’s income and expenses to remain basically the same.

Click here for downloading the semi-annual report 2011.

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