German lender Westdeutsche ImmobilienBank swung to a pre-tax loss of EUR 167 mln in 2011 as it grappled with the negative impact of the sovereign debt crisis. The negative result compares to a profit of EUR 99 mln a year before.
German lender Westdeutsche ImmobilienBank swung to a pre-tax loss of EUR 167 mln in 2011 as it grappled with the negative impact of the sovereign debt crisis. The negative result compares to a profit of EUR 99 mln a year before.
Group earnings after tax came to a negative EUR 157 mln in 2011, from EUR 95 mln in 2010, largely as a result of write-downs on the company's Greek government bonds (EUR 244 mln).
'Even though our results are affected by the extraordinary pressures of impairments on Greek government bonds and the sale process has placed tight constraints on the development of WestImmo, the figures for our core business underline the quality of our credit portfolio,' commented Claus-Jürgen Cohausz, chairman of WestImmo's managing board.
The sale process imposed by the European Commission had a significant impact on the development of new business. In 2011, Westimmo's volume of new business dropped 74% to EUR 855 mln, from EUR 3.3 bn a year before. Germany was the biggest individual market in the commercial investor business with a 32% share, whilst 54% of new business was pulled in from other European countries, 9% from USA/Canada and 5% from Asia.
Following the termination of talks with bidder Apollo in December last year regarding the sale of WestImmo, WestLB said it continues to make efforts to sell the property finance arm by 30 June 2012. Should it not be possible to sell the bank by this date, WestImmo will be transferred to Erste Abwicklungsanstalt (EAA), the bad bank of WestLB, with effect from 1 July 2012.
