“There are signs that we already have the cyclical low point behind us in the shipping markets,” said chief executive Gunter Dunkel. “However, it is not expected that the crisis will end in the short term and we can therefore again expect above-average loan loss provisions in the current year.”
The bank’s profits - “respectable, in view of the difficult conditions” - contrast with peers such as HSH Nordbank which reported after tax losses of $161m. Gains were driven by an 11% increase in Net Interest Income, which amounted to $2.5bn compared with $2.3bn in the previous year. However, Nord’s loan loss provisions were significantly increased to $777m from $255m previously.
“We have in recent years… not pursued an aggressive growth policy and have avoided risky financing,” said Dunkel. “Now that the crisis in the shipping markets is entering into its fifth year, it has also started to have an impact on us. We have accordingly increased our loan loss provisions in this segment substantially.
“This segment will, though, remain a key pillar of our business model in future.”
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