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First half of 2017 produces another set of good results for DG HYP

€2.7 billion in new Commercial Real Estate Finance Business - Net interest income at a good level and stable - Growing new business with the Volksbanken Raiffeisenbanken cooperative financial network

DG HYP has posted another set of good results: the first half of 2017 showed positive developments – both in new business for Commercial Real Estate Finance as well as the bank’s financial performance, which has been stable at a good level for several years. On a particularly satisfactory note, closer cooperation with the Volksbanken Raiffeisenbanken cooperative financial network has resulted in a significant rise in joint lending activity.

In Commercial Real Estate Finance, DG HYP generated €2.7 billion in new business (H1 2016: €3.4 billion), slightly below the exceptionally strong new business result of the same period last year. The figure, however, was still slightly above the bank’s expectations. Joint lending with cooperative banks increased by more than a third, to €1.5 billion (H1 2016: €1.1 billion). DG HYP does business jointly with more than 400 cooperative banks in regional markets throughout Germany.

DG HYP's financial performance reflects a positive operating performance in its Commercial Real Estate Finance business. The bank's net interest income rose by €4.5 million on the previous year, to €138.6 million during the first half of 2017 (H1 2016: €134.1 million). The operating result also improved slightly, to €70.3 million (H1 2016: €69.6 million). The net commission result of €16.7 million – which is generated in particular through servicing fees in Commercial Real Estate Finance – was down on the previous year's figure of €17.4 million. Administrative expenses remained stable at €71.9 million (H1 2016: €71.7 million).

As in the previous year, no material credit defaults occurred during the first half of 2017. Risk provisioning of €-11.9 million (H1 2016: €-13.4 million) includes a positive contribution from provisions for loan losses, and from the valuation result for securities held in liquidity reserves. In order to guard against potential future credit defaults, the positive balance was more than compensated by a material addition to general risk provisions pursuant to section 340f of the German Commercial Code (HGB), in accordance with prudent commercial judgement.

DG HYP expects this positive business trend to last throughout the full year of 2017. Dr Georg Reutter, DG HYP's Chairman of the Management Board, said: “With macroeconomic fundamentals stable and real estate demand intact, we look with confidence to what lies ahead for DG HYP’s business. Still, we will continue to apply the caution and prudence warranted in the lending market.”

DG HYP’s complete interim financial report as at 30 June 2017 will be available, from 31 August 2017, at www.dghyp.de. 


DG HYP: key financial indicators (in accordance with the German Commercial Code)


(€ mn) 01 Jan to 30 Jun 201701 Jan to 30 Jun 2016Change in %
New Commercial Real Estate Finance2,7033,420-21.0
Business originated jointly with cooperative banks1,5431,12836.8
Net interest income138.6134.13.4
Net commission result16.717.4-4.0
Administrative expenses71.971.70.3
Risk provisioning-11.9-13.411.2
Net financial result1.8-6.3>100.0
Operating result70.369.61.0
30 Jun 2017
31 Dec 2016
Total assets36,36336,696-0.9
Commercial real estate lending portfolio19,00319,742-3.7
Number of employees (average)4764652.4

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