Admin I Thursday, August 17, 2023
MUNICH – German bank BayernLB Bank has almost doubled its profit forecast for this year, expecting a pre-tax result of €1.1 billion ($1.2 billion) to €1.3 billion, the bank said on Tuesday.
The Bavarian bank’s original forecast in spring was €600 million to 800 million. The increased forecast is due in part to a rise in interest rates, which massively benefits banks.
“All customer segments made a strong contribution to this, and in addition we benefited from a kind of special economic situation in the first six months due to the interest rate turnaround,” chief executive Stephan Winkelmeier said.
In the first half of the year, BayernLB generated a pre-tax profit of €877 million, three times as much as a year earlier. The net profit increased even more from €175 million to €593 million.
Net interest income rose from €928 million to €1.5 billion, with the online bank DKB, the group’s most important subsidiary, contributing the lion’s share.
The publicly regulated bank is based in Munich and owned 75% by the state of Bavaria, one of Germany’s wealthiest states.