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08 Nov 2007

HSBC Trinkaus & Burkhardt AG third quarter 2007 results

 

  • Operating profit up 18.3 per cent in the first nine months of 2007 to €162.6 million, compared with the same period in 2006.
  • Profit after tax up 24.0 per cent in the first nine months of 2007 to €111.6 million versus the first nine months of 2006.
  • Return on equity before tax of 26.5 per cent during the first nine months of 2007, compared with 24.7 per cent for the same period last year.

 

HSBC Trinkaus & Burkhardt AG showed strong results in the first nine months of the year as all business segments exceeded comparable 2006 results. Operating profit during the nine month period was up 18.3 per cent period on period to €162.6 million. Profit after tax increased by 24.0 per cent compared with the first nine months of 2006 to €111.6 million. Trading profit remained at a high level despite the volatility in the capital markets. Net interest income and fee income were the greatest contributors to earnings.

Net interest income rose significantly during the first three quarters, by 24.4 per cent to €83.6 million versus the comparable period in 2006. This was primarily due to an increase in customer deposits which funded higher loans and advances to banks and increased loans and advances to customers. Interest income from financial assets, including investment income, remains at a high level.

Net fee income increased 14.2 per cent to €242.9 million compared to the previous year. This was due primarily to higher volumes in the securities business despite a slight slowdown in recent months. The issuing and structuring business also made a contribution to this growth.
  
Trading profit again improved, by 4.1 per cent to €84.3 million in the first three quarters compared with the same period in 2006, despite an extremely high starting base during the last two years. Volatility in capital markets in the third quarter resulted in the weakest earnings contribution from trading profit compared to the two preceding quarters in 2007. Equities and equity/index derivatives remain the strongest earnings component.

Net credit for loan impairment of €3.7 million was primarily attributable to the reversal of individually assessed impairments and a reduction in collectively assessed impairments. Credit risk provisioning continues to remain cautious and characterised by strong valuation standards.

Total administrative expenses increased 14.2 per cent compared with the first nine months of 2006. This was due to both an increase in the number of employees and higher performance-related remuneration. Other administrative expenses increased due to higher fees for consultancy services in IT projects for the further modernisation of IT infrastructure.

The cost efficiency ratio remained unchanged at 61.8 per cent compared with the comparable nine month period in the previous year.

The Management Board is aiming to increase operating profit for the full year compared with 2006. HSBC Trinkaus' business model and strategy joins up its traditional full range of personalised service and local expertise with the HSBC Group's worldwide network. To reinforce its strategy and distinctive image in the German market, HSBC Trinkaus will today introduce a new HSBC-branded logo campaign.

Media enquiries to:

Rainer Pfuhler
HSBC Trinkaus & Burkhardt AG
Tel: +49 (0)211) 910 3761

James Pieper
HSBC Holdings plc
Tel: +44 (0)20 7991 0624

1. HSBC Trinkaus & Burkhardt AG 
HSBC Trinkaus is one of the leading private banks in Germany and part of the globally-operating HSBC Group. In addition to the head office in Düsseldorf, HSBC Trinkaus is represented in six locations in Germany with over 1,800 employees and has access to the global network of the HSBC Group. With total assets of €21.8 billion* and €86.3 billion in funds under management and administration*, the bank has a Fitch IBCA rating of AA-. The core target groups are private clients, corporate clients and institutional clients. *(figures as at 30 September 2007)

Copies of all the bank's news releases can be found on the homepage www.hsbctrinkaus.de.

2. Notes to the consolidated profit and loss account and the consolidated balance sheet
The Interim Report for the HSBC Trinkaus & Burkhardt Group as at 30 September 2007 was drawn up in accordance with International Financial Reporting Standards (IFRS) as they are to be applied in the European Union. The interim reporting requirements as set out in IAS 34 are fulfilled in particular. Furthermore, the report takes into consideration the requirement of an interim management statement pursuant to Section 37x German Securities Trading Act (WpHG). No review of the Interim Report was carried out by external auditors.

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