Bankgesellschaft Expects Earnings Improvement

We expect the improvements in income to continue their positive development in the remaining months of the fiscal year, Bankgesellschaft said in an interim report.

The bank forecast a return to an own account trading profit for the full year after posting a trading loss of 56 million marks in the first nine months.

At the half year stage, the bank had a trading loss of 110 million marks.

The bank said the loss was linked to writedowns on equity derivatives in the first half, which had been offset by interest income.

The bank reported a 35.3 per cent drop in operating profit after risk provisions to 465 million marks in the first nine months.

 

Risk provisions rose to 612 million marks in the first nine months, up from 542 million marks in the year-ago period.

Bankgesellschaft said earnings remained under pressure from the continued need for high risk provisions caused by the difficult economic situation in its home region of Berlin and Brandenburg.

We estimate the need to maintain high risk provisions to remain high, the bank said.