The FINANCIAL — KfW IPEX-Bank GmbH, a legally independent, wholly owned KfW subsidiary since 1 January 2008, on March 30 presented the balance sheet for its first fiscal year.
In 2008 the market environment for international project and export finance was tense and characterised by the effects of the turbulence in the international financial markets. In this environment KfW IPEX-Bank looks back on a successful year of business operation.
The balance sheet total at the end of 2008 amounts to EUR 53.3 billion, marking an increase of EUR 8.4 billion over the previous year. The strong growth resulted primarily from high demand for financing in the past fiscal year. With a volume of business of EUR 63.7 billion (balance sheet total, contingent liabilities and irrevocable loan commitments) KfW IPEX-Bank is one of the main specialist financers in its segment.
KfW IPEX-Bank achieved an operating result of EUR 240.3 million. However, valuation losses had to be booked on the liquidity portfolio, which are maintained to secure liquidity in accordance with the requirements of the German Liquidity Regulation; these losses amounted to EUR 92.5 million. "In view of the persistently critical environment we have allocated by far the biggest portion of our remaining operating result, or EUR 137.9 million, to risk provisions for lending business", said Heinrich Heims, Speaker of the Board of Managing Directors. "Although this does not permit our annual result to match our initial planning, we are nevertheless satisfied with the overall result in the present circumstances." After taxes, KfW IPEX-Bank's net income for the year was EUR 5.1 million.
KfW IPEX-Bank's equity was EUR 2.6 billion as at 31 December 2008. Its regulatory capital was EUR 4.0 billion in total. This results in a total capital ratio of 14.05% and a tier 1 ratio of 9.32%.
"We expect the year 2009 to remain a continuing challenge for us", said Heims. "We are monitoring the cyclical situation very closely, and we are prepared for further turbulence. We know the markets in which we operate very well, and we have endured crises in the past, too. We are well equipped with our solid business model, our strong equity base, our customers' confidence and the support from our shareholder, and we will continue to make a significant contribution to KfW's promotional mission of supporting German and European economic interests even in difficult times."