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04.05.2005

Results for the first three months of 2005:
Bank Austria Creditanstalt gets off to a good start in 2005

  • Operating profit increases by 42.1 per cent to EUR 270 million
  • Profit after taxes rises by 48.7 per cent to EUR 207 million
  • CEE business segment makes the largest contribution to overall profits

In the first quarter of 2005, Bank Austria Creditanstalt (BA-CA) significantly improved its results compared with the same period of the previous year. Consolidated net income in accordance with IFRSs rose by 48.7 per cent to EUR 207 million (first quarter of 2004: EUR 139 million). All business segments of BA-CA contributed to the improved performance. Profit growth was driven by the Central and Eastern Europe (CEE) business segment, which contributed EUR 114 million (an increase of 68 per cent) to BA-CA's net income before taxes and thus accounted for about 41 per cent of the total figure.

Erich Hampel, Chairman of BA-CA's Managing Board: "We got off to a very good start in 2005. This enables us to continue our very favourable course pursued in the previous year."

Items in the income statement
Interest income rose by 13.1 per cent to EUR 1,312 million (2004: EUR 1,160 million). After deduction of interest expenses, net interest income was EUR 596 million (2004: EUR 543 million), up by 9.8 per cent on the first quarter of 2004. The net charge for losses on loans and advances increased slightly, by 5.2 per cent, to EUR 110 million (2004: EUR 105 million).

Net fee and commission income also developed favourably, rising by 11.3 per cent to EUR 330 million (2004: EUR 297 million). In the first quarter of 2005, the net trading result increased by 33 per cent to EUR 79 million (2004: EUR 59 million). General administrative expenses rose by 5.0 per cent to EUR 634 million (2004: EUR 604 million); all of this increase is due to exchange rate effects in Central and Eastern Europe. Bank Austria Creditanstalt's operating profit thus reached EUR 270 million, an increase of 42.1 per cent over the previous year's figure of EUR 190 million.

Net income from investments was EUR 10 million (2004: EUR 32 million). Bank Austria Creditanstalt's net income before taxes reached EUR 280 million, an increase of 37.6 per cent over the previous year (2004: EUR 204 million). Minority interests increased slightly, to EUR 20 million (2004: EUR 16 million), mainly as a result of Bank BPH's larger contribution to profits. Consolidated net income was EUR 207 million, up by 48.7 per cent on the previous year (2004: EUR 139 million).

This improvement in results has the following effects on key financial data:

  • The return on equity before taxes rose to 15.7 per cent (2004: 12.8 per cent) although shareholders' equity increased from EUR 7.1 billion to EUR 7.4 billion.
  • The return on equity after taxes rose to 12.3 per cent (2004: 9.3 per cent).
  • The cost/income ratio improved to 62.5 per cent (2004: 67.2 per cent).
  • Earnings per share for the quarter increased significantly, from EUR 0.95 to EUR 1.41.
  • The risk/earnings ratio (net charge for losses on loans and advances as a percentage of net interest income) improved from 19.3 per cent to 18.5 per cent.

Business segment results
Since the first quarter of 2005, Bank Austria Creditanstalt has divided its results into six business segments: Private Customers Austria, SMEs Austria, Large Corporates and Real Estate, Central and Eastern Europe, International Markets, and Corporate Center. The previous "Corporate Customers Austria" business segment has been divided into "SMEs Austria" (covering small and medium-sized businesses) and "Large Corporates and Real Estate". The new SMEs Austria business segment now includes business customers previously included in the Private Customers Austria segment. For the first time, Bank Austria Creditanstalt shows net income (after taxes) for the business segments. This new presentation enhances transparency and enables the Bank Austria Creditanstalt Group to more effectively manage business operations.
 
Central and Eastern Europe
Business in the region of Central and Eastern Europe (CEE) developed very well in the first quarter of 2005. BA-CA's banking subsidiaries in CEE increased their combined net income before taxes to EUR 138.9 million (2004: EUR 92.2 million), an increase of 50.7 per cent over the previous year's figure. After taking into account CEE-related income and expenses within Bank Austria Creditanstalt AG and consolidation effects, net income before taxes in the CEE business segment was EUR 114 million, up by 67.6 per cent on the previous year (2004: EUR 68 million). The CEE business segment thus accounted for 41 per cent of BA-CA's net income before taxes. Net income rose by 73.3 per cent to EUR 90 million 2004: EUR 52 million). The return on equity before taxes was 23.7 per cent (2004: 17.7 per cent). The cost/income ratio declined from 60.5 per cent to 56.2 per cent.

Bank Austria Creditanstalt's network currently comprises almost 1,000 branches in 11 CEE countries. This means that the bank operates the leading network in the region, with some 18,000 employees currently serving 4.5 million customers. BA-CA is planning to strongly expand its network in the next few years, through organic growth and acquisitions.

Details of other business segments
In the first quarter of 2005, the Private Customers Austria segment achieved a net income before taxes of EUR 49 million, an increase of 29 per cent over the previous year (2004: EUR 38 million). Net income increased by 37.6 per cent to EUR 38 million (2004: EUR 28 million). The return on equity before taxes reached 22.1 per cent (2004: 21.0 per cent). The cost/income ratio declined to 76.1 per cent (2004: 79.7 per cent).

Net income before taxes in the SMEs Austria segment was EUR 15 million (2004: EUR 14 million). Net income rose by 19.2 per cent to EUR 11 million (2004: EUR 9 million). The return on equity before taxes reached 6.8 per cent (2004: 6.0 per cent). The cost/income ratio was 63.8 per cent (2004: 58.3 per cent). In the past year, Bank Austria Creditanstalt initiated measures to improve the earnings power of this business segment on a sustainable basis.  

In the Large Corporates and Real Estate segment, net income before taxes rose by 42.3 per cent to EUR 74 million (2004: EUR 52 million). Net income increased by 48.7 per cent to EUR 58 million (2004: EUR 39 million). The return on equity before taxes improved significantly, to 19.4 per cent (2004: 14.0 per cent). The cost/income ratio was 41.2 per cent (2004: 54.1 per cent).

The International Markets segment generated net income before taxes of EUR 43 million, an increase of 79.2 per cent over the previous year (2004: EUR 24 million). Net income rose by 87.5 per cent to EUR 34 million (2004: EUR 18 million). The return on equity before taxes reached 70.9 per cent (2004: 49.2 per cent). The cost/income ratio was 56.1 per cent (2004: 62.3 per cent).

The Corporate Center recorded a net loss before taxes of EUR 15 million (2004: net income before taxes of EUR 7 million).

Inclusion of results in the business segments of HVB Group
BA-CA's net income before taxes is included in HVB Group's business segment results in the following way: calculated refinancing costs and other consolidation effects are deducted from the amount of EUR 280 million. The remaining amount of EUR 244 million is apportioned to HVB Group's business segments: EUR 216 million to the Austria and CEE segment, EUR 42 million to Corporates & Markets, and minus EUR 14 million to Other Items.

Balance sheet
As at 31 March 2005, Bank Austria Creditanstalt's total assets amounted to EUR 148.8 billion an increase of 1.6 per cent over the year-end 2004 figure (31 December 2004: EUR 146.5 billion).

On the assets side of the balance sheet, loans and advances to, and placements with, banks were reduced by 3.8 per cent to EUR 23.1 billion compared with the level at the end of the previous year (2004: EUR 24.0 billion). Trading assets rose by 0.5 per cent to EUR 18.7 billion. Loans and advances to customers increased slightly, by 0.9 per cent, to EUR 82.0 billion (2004: EUR 81.3 billion). Investments increased by 6.9 per cent to EUR 18.5 billion (2004: EUR 17.3 billion).

On the liabilities side, amounts owed to banks increased by 3.7 per cent to EUR 41.4 billion (2004: EUR 39.9 billion). Amounts owed to customers rose by 2.6 per cent to EUR 59.4 billion (2004: EUR 57.8 billion). Liabilities evidenced by certificates decreased by 3.6 per cent to EUR 18.9 billion (2004: EUR 19.6 billion). Shareholders' equity increased by 4.8 per cent to EUR 7.4 billion (2004: EUR 7.1 billion).


Enquiries: Bank Austria Creditanstalt Press Relations
Martin Hehemann, tel.: +43 (0)5 05 05 57007; e-mail: martin.hehemann@ba-ca.com 
Peter N. Thier, tel.: +43 (0)5 05 05 52371; e-mail: peter.thier@ba-ca.com 

Income statement of Bank Austria Creditanstalt for the first three months of 2005

 

1 Jan.-
31 March 2005
in EUR m

1 Jan. -
31 March 2004
in EUR m

Change

in EUR m

Change

in %

Net interest income

596

543

53

9.8

Losses on loans and advances

-110

-105

-5

5.2

Net interest income after losses on loans and advances

486

438

48

10.9

Net fee and commission income

330

297

34

11.3

Net trading result

79

59

20

33.0

General administrative expenses

-634

-604

-30

5.0

Balance of other operating income and expenses

9

0

9

-

Operating profit

270

190

80

42.1

Net income from investments

10

32

-21

-67.0

Amortisation of goodwill

0

-18

18

-

Balance of other income and expenses

0

0

0

-

Net income before taxes

280

204

77

37.6

Taxes on income

-53

-49

-4

8.9

Net income

227

155

72

46.6

Minority interests

-20

-16

-4

28.3

Consolidated net income

207

139

68

48.7

Income statement of Bank Austria Creditanstalt by quarter

 

Q1 2005

Q4 2004

Q3 2004

Q2 2004

Q1 2004

 

in EUR m

in EUR m

in EUR m

in EUR m

in EUR m

Net interest income

596

647

609

642

543

Losses on loans and advances

-110

-89

-102

-102

-105

Net interest income after losses on loans and advances

486

558

507

540

438

Net fee and commission income

330

301

317

319

297

Net trading result

79

88

55

31

59

General administrative expenses

-634

-644

-620

-612

-604

Balance of other operating income and expenses

9

-57

-3

-12

0

Operating profit

270

246

255

266

190

Net income from investments

10

-17

-11

-24

32

Amortisation of goodwill

0

-22

-18

-18

-18

Balance of other income and expenses

0

-3

2

-1

0

Net income before taxes

280

204

227

223

204

Taxes on income

-53

-23

-54

-62

-49

Net income

227

181

173

162

155

Minority interests

-20

-14

-16

-15

-16

Consolidated net income

207

167

157

146

139

Business segments Jan.-Mar. 2005 / Jan.-Mar. 2004

 Charts

Balance sheet of Bank Austria Creditanstalt at 31 March 2005

Assets

31 March 2005
in EUR m

31 Dec. 2004
in EUR m

Change
in EUR m

Change
in %

Cash and balances with central banks

3,883

2,724

1,160

42.6

Trading assets

18,660

18,575

85

0.5

Loans and advances to, and placements with, banks

23,087

23,995

-909

-3.8

Loans and advances to customers

82,028

81,260

768

0.9

- Loan loss provisions

-3,256

-3,305

48

-1.5

Investments

18,509

17,316

1,192

6.9

Property and equipment

1,104

1,122

-18

-1.6

Intangible assets

1,119

1,133

-14

-1.2

Other assets

3,692

3,700

-8

-0.2

Total assets

148,825

146,521

2,304

1.6

Liabilities and shareholders' equity

31 March 2005
in EUR m

31 Dec. 2004
in EUR m

Change
in EUR m

Change
in %

Amounts owed to banks

41,404

39,927

1,477

3.7

Amounts owed to customers

59,367

57,856

1,511

2.6

Liabilities evidenced by certificates

18,912

19,617

-705

-3.6

Trading liabilities

8,605

8,930

-325

-3.6

Provisions

3,797

3,757

41

1.1

Other liabilities

3,942

4,063

-121

-3.0

Subordinated capital

5,379

5,291

89

1.7

Shareholders' equity

7,419

7,081

338

4.8

of which: minority interests

467

439

28

6.4

Total liabilities and
shareholders' equity

148,825

146,521

2,304

1.6