In the first quarter of 2005, Deutsche Postbank AG continued its success story. Bonn-based Postbank increased its profit before tax to €165 million, a year-on-year increase of 15.4%. Pre-tax return on equity rose by 2.1 percentage points to 13.8%, while the cost/income ratio improved year-on-year from 70.6% to 69.1%. The Postbank share increased by 9.2% in the first three months alone.

The strong result achieved was the result of a substantial increase in income. Administrative expenses and allowance for losses on loans and advances rose only slightly, mainly as a result of expanding business.

Balance sheet-related revenues (net interest income, net trading income and net income from investment securities) increased by 4.3% to €514 million. The positive performance was supported by strong net interest income. Due to a strong growth in the volume of customer business, this rose by 15.9% to €422 million, thus continuing the positive trend. The decline in net trading income of 24.4% to €31 million, and in net income from investment securities by 30.7% to €61 million, compared to the strong previous quarter, was thus considerably overcompensated. The increase in net fee and commission income by 38.9% to €175 million was not just down to successful business with private customers, but was also due to the fact that revenues from insourcing in Transaction Banking in the previous quarter had not yet been included.

At €51 million, allowance for losses on loans and advances was 24.4% up on the first quarter of 2004. This performance reflects the successful expansion of customer credit business.

The increase in administrative expenses by 8.9% compared to the previous quarter to €476 million is almost entirely due to the assumption of business units, particularly in Transaction Banking. The stable development of the cost basis again emphasizes Postbank's high level of efficiency. This demonstrates its capacity to expand customer business at low cost using its modern transaction platform.

190,000 new customers
As before, Postbank continues to attract a high influx of new customers. In the first three months of the new fiscal year, 190,000 people chose Postbank.

At 124,000, the number of new checking accounts opened by private customers was just under the record level for the first quarter of 2004 (146,000).

The savings volume increased by approximately €214 million to €41.1 billion compared to the end of 2004. Again, high achievers were the "DAX Sparbuch", with a volume increase of approximately €150 million to €5.2 billion, and the exclusive online "SparCard direkt", which generated an inflow of approximately €550 million and extended its portfolio volume to €3.3 billion.

Gross new business in the area of retail funds constituted €501 million, including the closing sum of the newly launched Postbank Top Invest fund, and was thus 32.5%, or €123 million, up on the previous quarter. Overall, customer real estate funds acquired a 45% share, equity funds 18%, bond funds 11%, guarantee funds 10% and umbrella funds 6%.

Investment consultancy in demand
The number of high-potential private customers who were supported thanks to Postbank's mobile sales rose from 13,500 at the end of last year to 17,000 as at March 31, 2005. At the end of the quarter, Postbank had a team of 384 advisors under contract for the mobile customer advisory concept. This number should increase to approximately 500 by the end of 2005. Gross commissions and the number of products per customer are well ahead of the sector average.

Further growth in mortgage lending
In Q1 2005, Postbank continued to generate rapid growth in private mortgage lending with €4.8 billion of new business. With a self-generated new volume of private mortgage lending of almost €1.5 billion, quarterly growth was €380 million higher than the previous quarter. In addition, takeovers with a volume of €3.3 billion were assumed. The portfolio of private mortgage loans thus rose to €26.1 billion compared to €22.3 billion at the end of 2004.

The installment credit business also posted pleasing results with a new business volume of €170 million. The portfolio thus increased to almost €1.3 billion, compared to €1.2 billion at the end of 2004.

At €128.8 billion, Postbank's total assets as at March 31, 2005 were at approximately the same level as the end of last year (€128.1 billion). The number of employees fell to 9,963 (December 31, 2004: 10,006, calculated as full-time equivalents).