In fiscal 2004, Deutsche Postbank AG was again successful. With 890,000 new customers and growth in many product areas, it further improved its market position.
Prof. Dr. Wulf von Schimmelmann, Chairman of the Postbank Management Board, commented to journalists in Frankfurt am Main: “We asserted ourselves in a difficult environment. As a listed company what was particularly important for us is that we delivered what we promised. We even gained ground in our core business, Retail Banking. What is important in 2005 is to continue this development. And the strategic preparations have been made for this.“
As an example, Von Schimmelmann cited the third-party distribution of home savings contracts via 5,500 agents under the DSL Bank brand. With DSL Privatkredit, the Bonn-based bank developed a product aligned specially to the requirements of third-party distribution. In 2004, it gained its first sales partners which included AWD, MLP und Wüstenrot. Von Schimmelmann anticipates a revival of sales for this strong-margin loan product.
Postbank has extended Postbank Vermögensberatung, it mobile sales arm, as a further pillar of its distribution. To the end of 2004, it already had 370 commercial agents who were advising 12,000 customers. Postbank Vermögensberatung is aiming to have 500 commercial agents under contract by the end of 2005.
Strong growth in the loan business
In 2004, the volume in the consumer loan business increased by 18% to EUR 1.2 billion. Postbank increased its portfolio of home savings contracts by EUR 5.1 billion to EUR 22.3 billion.
Postbank also posted successes in selling unit trusts. In 2004, new business increased by 30% to EUR 1.46 billion. In the area of public funds, the Postbank fund sales arm has gained a market share in gross new business of 2.31%.
Together with its life insurance cooperation partner, PB Lebensversicherung, in 2004 it generated inflows from life insurance which were up 233% to EUR 1.418 billion. This growth was well above the market average of 51%. In 2005, Postbank wants to devote particular attention to the subject of pensions. It has developed a pension provision account which it is to market in the form of a certificate from June 2005.
Classics remain successful
Supported by product innovations, the savings volume increased by 4.5% to EUR 40.8 billion in 2004. To the end of the year, a total of EUR 5 billion was invested on the DAX Sparbuch alone, an increase of EUR 1.8 billion. Together with the Aktion Mensch charity, the Postbank Gewinnsparen (its save and win program), generated a volume of approximately EUR 850 million. To the end of 2004, Postbank attracted deposits of EUR 2.7 billion from the SparCard direct product which is only available via the Internet. Against the previous-year figure of EUR 1.5 billion, this represents an increase of 80%.
In 2004, the number of new checking accounts increased by 9.8% to over 554,000. With 4.4 million private checking accounts, Postbank further consolidated its market leadership.
Transaction Banking with a good start
Von Schimmelmann stated that the Transaction Banking division had started well. Payments of its two clien¬ts, Deutsche Bank and Dresdner Bank, were transferred without any major problems. The Chairman of the Management Board stated that the main objective for 2005 was extending the market position in this area. “We are confident of gaining another large client in 2005 and thus extending the market position we have already reached. In the middle term, we want to increase considerably the market share of 16% we have already reached.”
In 2004, Postbank generated another record result. Profit before tax increased by 25.6% to EUR 624 million. Net profit improved 19.3% to EUR 420 million.
The cost-income ratio declined from 76.1% in 2003 to 70.8%. The return on equity before tax climbed three percentage points to 13.7% after 10.7% in 2003. In 2004, Postbank reduced total assets to EUR 128.2 billion as scheduled (2003: EUR 132.6 billion / minus EUR 4.4 billion). At the same time it considerably improved its balance sheet structure.
Postbank is reiterating its objective of generating a return on equity before tax of 15% and pushing the cost-income ratio in the classical bank business to under 65% in 2006. In 2005, it intends to come much close to achieving these goals.
