Stabilisation measures for VBAG take effect: satisfactory first quarter result
Österreichische Volksbanken-Aktiengesellschaft (VBAG) Group has ended the first quarter of 2012 with a satisfactory result. The result before taxes was euro 39 million, the consolidated result after taxes and non-controlling interest amounted to euro 22 million. These figures show, that the stabilisation measures (capital reduction and subsequent capital increase, sale of Volksbank International AG, sale of all VBAG participations in the VICTORIA Volksbanken insurance companies and sale of Selini Holding GmbH) take effect and contribute to a significant strengthening of VBAG’s capital.
In particular, a marked improvement in capital ratios was achieved with the sale of the VBI sub-group. As of 31 March 2012, the tier I ratio (in relation to total risk) was 11.1% (31 December 2011: 8.8%), and the equity ratio (in relation to total risk) stood at 16.6% (31 December 2011: 12.7%).
Statement of financial position and own funds
VBAG Group’s own funds amounted to euro 3.2 billion as at 31 March 2012. Retroactive capital measures (capital reduction and capital increase) were already included in the calculation of own funds.
As at 31 March 2012, total assets amounted to euro 31.6 billion, which represents a decrease of euro 9.5 billion compared with 31 December 2011. Of this decrease, euro 8.8 billion is attributable to the deconsolidation of the VBI sub-group.
Results in detail
The 1-3/2011 result for Volksbank Romania (VB RO), which has been measured at equity as of October 2011, is included in the result for the comparative period.
Risk provisions for the first quarter of 2012 amounted to euro 22 million (Q1 2011: euro 45 million). VB RO was responsible for euro 18 million of the decrease and the corporates business area within the Non-core Business segment for euro 4 million.
General administrative expenses were reduced by euro 23 million to a total of euro 65 million. In addition to VB RO, which was responsible for euro 14 million of the decrease, cost savings were achieved particularly in the Investment Book/Other Operations segment. Adjusted for the disposal group, the number of employees fell by 56 since the end of 2011 to 1,982. Of these, 779 work outside Austria.
Net interest income amounted to euro 56 million in the first quarter of 2012, down euro 60 million year-on-year. Euro 32 million of the decline is attributable to VB RO and euro 12 million to other areas of the Non-core Business segment. Net interest income remains below the previous year's level in the Investment Book/Other Operations segment since, in view of VBAG´s conservative policy on interest-rate risks, maturing investments were not fully replaced.
Net fee and commission income in the first quarter of 2012 was euro 20 million, down euro 5 million year-on-year. The Non-core Business segment was responsible for euro 4 million (VB RO euro 2 million) of this decline. Net trading income increased from euro 5 million to euro 8 million.
The interim report is available for download on www.volksbank.com
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