Landesbank Hessen-Thüringen (Helaba) benefited from increased commission and interest income last year. Before taxes, profit rose by 11.3 percent to 633 million euros, as the institute announced on Thursday in Frankfurt. "The positive development in the operating business is continuing," said Helaba CEO Thomas Groß. Despite the weakening economy and high inflation, he was confident for the current year. Groß expects a pre-tax profit of between 2023 and 500 million euros in 700.
In 2022, Helaba's net interest income increased by almost seven percent to EUR 1.4 billion thanks to the European Central Bank's (ECB) interest rate turnaround. In the retail and asset management sector, however, Helaba, like many other institutions, had to accept interest-related valuation losses. These reduced the division's pre-tax profit by more than 20 percent. The Group's net commission income rose by ten percent to EUR 533 million.
Lower loan loss provisions
After Groß took office on 1 June 2020, Helaba's Executive Board had set itself the goal of achieving an annual pre-tax profit of at least EUR 500 million in the following years. EUR 500 million is also the target figure for net commission income, which is based, for example, on income from the Landesbank as a service provider for savings banks in Hesse, Thuringia, North Rhine-Westphalia and Brandenburg.
For bad loans, the bank set aside 162 million euros, 21 percent less than in the previous year. "Helaba continues to enjoy high portfolio quality," explained Detlef Hosemann, who is responsible for risk management. "With regard to our credit exposures, the risk situation remains relaxed."
The Bank's administrative expenses rose by nine percent to EUR 1.65 billion. She attributed this to higher personnel costs, investments in IT modernization and higher mandatory levies. All in all, profit after tax fell by almost 14 percent to 431 million euros. "We achieved a very pleasing result in 2022 in a geopolitical and macroeconomic environment characterized by uncertainties," said CEO Groß.