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Q3 2013: 7% growth in profit despite weak third quarter

Commercially the trend of gradual growth in turnover in the institutional market continued, as evidenced by, among other things, the growth in the assets under administration to € 320 billion.

30 Oct 2013

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Main points

  • The total result increased by 7% to € 11.7 million compared to 2012, partly as the result of one-off exceptional gains. At € 8.4 million the banking result lagged approximately 16% behind the result for the same period in 2012. The operating result declined marginally compared to the first six months of 2013.
  • The assets under administration increased by 4% to € 320 billion; the commercial results in the institutional market are developing favourably. The transaction market improved slightly compared to 2012.
  • Operating cost development to the end of September 2013 remained the same with respect to the first nine months of 2012.
  • Solvency is still strong at an average of 22%.

Commercially the trend of gradual growth in turnover in the institutional market continued, as evidenced by, among other things, the growth in the assets under administration to € 320 billion. Partly as a result of the Alternative Investment Fund Managers Directive (AIFMD) taking effect in mid-2014, the order portfolio for 2014 is well filled. The effective introduction of parts of the European Market Infrastructure Regulation (EMIR) in 2013 and 2014 also contributes to growth in turnover to a limited extent. As a neutral party, we are well positioned to help pension funds, asset managers, banks and other parties with the implementation of this complex European regulation.

The total result to the end of the third quarter of 2013 increased by 7% to € 11.7 million, though the third quarter was a relatively weak quarter in terms of result. The interest income lagged approximately 20% behind 2012, in line with expectations. There is little prospect of an increase in the short-term interest rate, which means the bank will still suffer from the unfavourable short-term interest rate, at least for the time being. In terms of commission revenues, the income from securities lending was lower than in the same period in 2012 as a result of the surplus of cheap liquidity. Despite an improvement in 2013, the volumes on the transaction market have still not recovered from the downturn of the past few years.

Operating cost for the first nine months are at the level of the same period in 2012. The total costs in the third quarter were 11% below the level of 2012, partly due to the release of a part of the pension liability as a result of the implementation of a new pension contract for the company’s own employees. The costs include the lion’s share of the project costs relating to the cooperation with dwpbank and one-off items relating to a number of redundancies. An additional reorganisation charge is expected in the fourth quarter, which is aimed at structural improvement of the operating result from 2014. As announced earlier, a release of approximately € 7.5 million will take place in the fourth quarter as the result of the sale of one of our office buildings.

Our low risk profile is expressed in the quality of the balance sheet and the high solvency ratio. The average BIS ratio is still strong at 22%.

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Remko Dieker

More information

Remko Dieker

Secretary to the Managing Board / Investor Relations
+31 (0)20 557 51 80