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Helaba H1 profit rises 82.1% YOY; higher FY'19 pretax profit expected

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Helaba H1 profit rises 82.1% YOY; higher FY'19 pretax profit expected

Landesbank Hessen-Thüringen Girozentrale, or Helaba, now expects a year-over-year rise in full-year 2019 pretax net profit after completing in May its acquisition of Dexia SA's German unit.

The bank's consolidated net profit in the first half amounted to €255 million, an 82.1% increase from the year-ago €140 million, owing largely to its acquisition of KOFIBA-Kommunalfinanzierungsbank GmbH. Its consolidated pretax net profit in the half rose to €325 million from 200 million a year ago.

The bank said it plans to begin the legal integration of KOFIBA in early September, with a view of completing its full integration by the end of the first quarter of 2020.

Net interest income in the half climbed on a yearly basis to €557 million from €521 million, so did net fee and commission income, to €186 million from €172 million. Other net income totaled €307 million, up from €179 million a year earlier, on the back of the special effects from the first-time consolidation of KOFIBA.

Provisions for losses on loans and advances was €34 million, compared with a year-ago reversal of €13 million. The bank incurred general and administrative expenses of €772 million in the half, up from €720 million a year ago, mainly due to higher IT and consulting expenses and higher costs from allocations to institutional protection schemes and bank levy.

Helaba's fully loaded common equity Tier 1 ratio was 14.6% as of June-end, lower than 14.9% as of 2018-end. Its phased-in leverage ratio also slipped over the same period to 4.35% from 5.1%.