Helaba sustains growth momentum in H1 2024 with double-digit rise in earnings to € 413 million

• Consolidated net profit before tax increases by 22.8 percent to € 413 million (H1 2023: € 336 million)
  
• Helaba’s diversified business model generates constant positive growth, even in challenging cycles
• Operating income in first six months rises significantly to € 1,470 million (+ 12.1 percent)
• Net fee and commission income improves to € 272 million (H1 2023: € 259 million)
• Net interest income of € 907 million remains on high level (H1 2023: € 817 million)
• Considerably higher investments in modernising IT infrastructure and in growth initiatives reflected in general and administrative expenses
• Loan loss provisions of € 173 million elevated in line with expectations
• CET1 ratio climbs to 14.2 percent (30 June 2023: 13.9 percent)
• Return on equity higher at 8.5 percent (30 June 2023: 8.1 percent) while cost/income ratio improves to 58.1 percent (30 June 2023: 61.0 percent)
• Helaba reaffirms guidance for 2024: Full-year result at previous year’s level

In the first half of 2024, the Helaba Group achieved a sharp 22.8 percent rise in its consolidated net profit before tax to € 413 million (H1 2023: € 336 million), reaffirming its forecast of generating a full-year result on a par with the previous financial year. This strong performance largely reflects tangible growth in the Group's operating income.

"We closed out the first half of 2024, in which we continued to face a challenging economic environment, with a very encouraging result. Earnings from operating activities continued to increase, while further growth in non-interest bearing business was also a welcome development. My tremendous gratitude goes to all our members of staff who work every day to make this success possible," remarked Thomas Groß, Helaba's CEO, on the Group's results. "Our well-diversified business model forms the basis for steady and positive growth. In order to maintain this positive trend, we continue to make strategically targeted investments in our growth initiatives and our IT infrastructure."

Net interest income increased significantly to € 907 million (H1 2023: € 817 million). With the interest rate environment that remains favourable, deposit-taking activities generated a positive result. Income from investing the Group's own funds and from interest rate management activities by the treasury department also made a substantial contribution to growth in net interest income. Furthermore, the Group managed to raise margins on new lending business. Net fee and commission income, which rose to € 272 million (H1 2023: € 259 million), benefited from the strong performance of cash management, securities and custodian business as well as asset management. There was a noticeable improvement in the result from investment property to € 131 million (H1 2023: € 86 million), while the result from fair value measurement declined as expected to € 78 million (H1 2023: € 99 million). Net income from trading activities, which is included in the latter item, increased to € 65 million (H1 2023: € 51 million). Considerably higher investments in modernising the Group’s IT infrastructure and in growth initiatives, as well as lower costs due to the absence of the bank levy, are reflected in general and administrative expenses of € -884 million (H1 2023: -867 million).

As anticipated, net additions to loan loss provisions of € -173 million (H1 2023: -108 million) remained on an elevated level. This figure includes burdens from real estate activities and specific corporate banking counterparties.

Thomas Groß looks to the full year with confidence: "A significant factor is persistent uncertainty in respect of the economy, not only in Germany. In addition, ongoing geopolitical tensions, combined with a still restrictive monetary policy and the resulting high financing costs, are having an impact on the capital and real estate markets," says Groß. "However, over the medium term, we feel that the opportunities outweigh the risks. Moreover, our broadly diversified business model that is geared towards stable growth means we are ideally positioned on the markets in which we operate. We remain confident that full-year earnings for 2024 will be in line with last year. In the medium term, we expect to achieve a sustainable consolidated profit before tax in excess of € 750 million."

Summary of key figures for H1 2024

Other income increased to € 75 million (H1 2023: € 46 million).

The consolidated net profit after tax climbed to € 298 million (H1 2023: € 241 million).

The CET1 ratio improved to 14.2 percent (30 June 2023: 13.9 percent).

The cost/income ratio (CIR) reached 58.1 percent (30 June 2023: 61.0 percent).

Return on equity (RoE) improved to 8.5 percent (30 June 2023: 8.1 percent).

Total Group assets amounted to € 206.1 billion (31 December 2023: € 202.1 billion).

Segment report

Pre-tax earnings in the Real Estate segment of € 93 million were significantly higher than in the previous year (H1 2023: € -25 million) thanks to lower burdens from loan loss provisions. Net interest and net fee and commission income remained stable. Net additions to risk provisioning stood at € -49 million (H1 2023: € -173 million).

The contribution to earnings from the Corporates & Markets segment fell to € 41 million (H1 2023: € 183 million). Net interest income declined slightly to € 270 million (H1 2023: € 288 million). Compared to the relatively low level in the previous year, additions to loan loss provisions increased to € -107 million (H1 2023: € -10 million) due to defaults of individual exposures. Net trading income in the segment amounted to € 60 million (H1 2023: € 51 million). The result from fair value measurement (non-trading) fell to € -2 million (H1 2023: € 18 million) as a result of negative valuation effects.

The Retail & Asset Management segment saw a marked jump in earnings to € 223 million (H1 2023: € 163 million). An increase in net interest income to € 206 million (H1 2023: € 197 million) was largely generated by Frankfurter Sparkasse. Net fee and commission income grew to € 154 million (H1 2023: € 142 million) and was primarily driven by Frankfurter Sparkasse, Helaba Invest and Frankfurter Bankgesellschaft. The result from investment property of € 131 million was almost entirely attributable to GWH.

With a pre-tax profit of € 26 million (H1 2023: € 29 million), WIBank's contribution to the Group's net earnings was virtually unchanged from the previous year. WIBank performs essential development funding activities for the German state of Hesse. In addition to the promotional loan business, which generates a corresponding net interest income, as a service provider WIBank is also responsible for fulfilling additional tasks mandated by the State of Hesse and other public sector authorities.

In the Other segment, net income before tax of € 20 million was considerably higher than in the same period last year (H1 2023: € -15 million). An increase in net interest income to € 183 million (H1 2023: € 98 million), which was chiefly related to investments of the Group's own funds and to interest rate management activities, was a key factor in this result. Total risk provisioning in this segment returned to a normal level of € -8 million (H1 2023: € +66 million).