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Integration of BHW and branches continuing successfully
Share price more than doubled
Guidance confirmed
Deutsche Postbank AG is making good progress with the integration of its new business units BHW and Branches. This was announced by the Chairman of the Board of Management, Prof. Wulf von Schimmelmann, at the second Annual General Meeting of Postbank on May 11 in Cologne. To the beginning of the year, Postbank acquired not only BHW, the second biggest home loan and savings association in Germany, but also the 850 most attractive branches of Deutsche Post. "These transactions changed Postbank overnight," underlined von Schimmelmann. "The number of people working as employees or mobile sales more than tripled. We set the course for further growth at the right time."
Von Schimmelmann expressed confidence that the adjustments in the context of the integration would not result in any operational terminations. He indicated the recently started early retirement and settlement initiative, which supports the pending personnel adjustments. "We have been negotiating the necessary organizational measures with the social partners for some weeks and hope that these talks will have been concluded successfully by the middle of the year and with consensus", underlined von Schimmelmann. Von Schimmelmann stated his satisfaction on the Bank posting another very good result in 2005. Pre-tax profit increased by 11.0% to EUR 719 million, with Retail Banking contributing EUR 588 million. At EUR 149 million, the Corporate Banking result was up 19.2% on 2004 and Financial Markets also improved, by 14.3% to EUR 120 million. The Transaction Banking segment not only profitably employed several hundred staff - which would otherwise have been overhang - but also generated a result of EUR 23 million after EUR 9 million in the previous year. In addition to the dividend of EUR 1.25, 2005 resulted in excellent share price performance for shareholders. The share price rose by 50.8% or EUR 16.50 to EUR 49, leaving the DAX, which increased by 27.1% in the same period, well behind. "If the development since the beginning of 2006 is added to this, then the initial shareholders have seen their investment more than double," emphasized von Schimmelmann. Von Schimmelmann confirmed the aim of making Postbank number 1 in Germany, as a financial services provider for private customers and as a service provider for companies. Despite the negative impact from the integration, the result in 2006 should be further improved. In 2008, the return on equity should be at least 20%. The cost-income ratio in the classical bank business can increase for a short period as a result of the integration to up to 69%, but is likely to move to below 63% by 2008. With a view to the imminent World Cup von Schimmelmann stated, "Our tactics are right. The Postbank team is fit, with all positions being well filled. We do not have any easy opponents in our group. But this only spurs us on, as we master our system as does no other." Source: Press Release
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