Hypo RE sees net return on equity of 12% in 2007

German real estate bank Hypo Real Estate Group on Thursday reported net profit of EUR 266 mln for the third quarter, up from EUR 112 mln over the same period a year ago. Adjusted for tax-loss carry-forwards and the effects of changes to tax legislation, plus the recently completed acquisition of DEPFA bank, net income for the quarter came in at EUR 135 mln, up from EUR 109 mln a year earlier.

Pre-tax profit for the quarter was EUR 172 mln, up from EUR 148 mln in 2006. Operating income rose to EUR 274 mln, from EUR 270 mln a year earlier. Loss provisions fell to EUR 17 mln, from EUR 36 mln in year-earlier period.

New business was up again, coming in at EUR 10.3 bn, compared with EUR 10 bn in the second quarter of this year, and EUR 6.3 bn in the first quarter.

DEPFA, which is based in Ireland, has reported pre-tax profit of EUR 80 mln, excluding one-off merger costs, down from EUR 134 mln in the same period in 2006. Net income came in at EUR 121 mln, compared with EUR 110 mln a year earlier. Operating revenues totalled EUR 154 mln, down from EUR 187 mln a year earlier, largely due to the trading loss of EUR 39 mln.

Hypo said it expects a consolidated net return of equity after taxes of 12% for the full year 2007, rising to 15% by the full year 2010.