Deutsche Postbank AG remains on growth track. Against the third quarter of 2004, it increased profit before tax by 11.9% to €179 million. In the first three quarters, profit before tax was 15.1% up year-on-year, to €517 million. In the third quarter, the Bonn-based bank gained 181,000 new customers. Since the beginning of the year, a total of approximately 543,000 new customers have been acquired. Thus, after nine months, Postbank has almost reached its objective of obtaining 600,000 new customers in the 2005 fiscal year.

After the first nine months, the cost/income ratio was 68.5%, after 70.9% in the equivalent period of the previous year. In the classical banking business, i.e. adjusted for the industrially aligned Transaction Banking division, Postbank achieved a cost/income ratio of 66.0% after 69.2% in the equivalent period of the previous year, thus steadily approaching its target of 65% for 2006. In the first nine months, pre-tax return on equity further improved to 14.1%, after 13.2% in the comparable period of the previous year.

In the first nine months, total income improved by 8.2% year-on-year to €2,104 million and in the third quarter by 3.8% to €711 million.

In a nine-month comparison, balance-sheet related revenues, (net interest income, net trading income and net income from investment securities) increased by 4.2% to €1,575 million. Despite interest rates being at a historically low level in the course of the year, net interest income improved by 9.3 % year-on-year to € 1,255 million, increasing by 0.7% to €407 million in comparison to the third quarter of the previous year. At €166 million net income from investment securities was 6.2% down year-on-year, but up 26.4% to €67 million in comparison to the third quarter of the previous year. In the first nine months, net trading income declined by 17.2% to €154 million and in the quarter was unchanged year-on-year at €59 million.

The increase in net fee and commission income by 22.2% to €529 million on a nine-month basis is partially due to the fact that the new Transaction Banking division was only included for part of the comparative previous-year period. However, the like-on-like third quarter com-parison with an increase of 5.3% shows that there was a further improvement in this core business. After the considerably higher level in the previous year, the Retail Banking business generated a further increase of 22.5%. The net trading income share of total income rose from 22.3% in the first nine months of 2004 to the current nine-month figure of 25.1%.

At €155 million, the allowance for losses on loans and advances increased by 23.0%, largely in line with the 25.4% expansion of the credit business in the first nine months of the current year. In comparison to the previous year, it remained unchanged at €52 million.

In the first nine months, the 4.6% increase of administrative expenses to €1,442 million was moderate in view of the strong growth. This applies particularly as the basis effect of Transaction Banking only impacted from the middle of last year. Adjusted for this, the Postbank cost basis remains almost unchanged. This is due to the highly efficient platform strategy at Postbank, which allows growth with costs increasing at a lower rate.

At €10 million, other operating income and expenses were at the same level of first nine months of the previous year.

Group profit after tax was €335 million, with the tax ratio being 35%. It is thus also up year-on-year, by 15.1%.

Earnings per share totaled €2.04, after €1.77 in the first nine months of 2004.

As at September 30, 2005, total assets at Postbank of €133.9 billion were approximately €5.8 billion up on the 2004 year-end figure and €2.9 billion higher than the figure on June 30, 2005.

BHW and Postbank: Smooth integration expected
BHW and Postbank expects to commence formal integration in January 2006, With the legal transfer of the shares. The initial preparations are to start immediately. The similar corporate culture, the largely identical business model and good experience Postbank obtained in the successful integration of DSL Bank, are good conditions for a rapid and smooth merger.

Further dynamic development in Retail Banking
In the reporting quarter, the number of new checking accounts was 130,000, after 159,000 in the comparable period of the previous year. To September 30, 2005 a total of 369,000 new checking accounts were opened by private customers, after 439,000 in the first three quarters of the previous year. The only slight decline is pleasing as the strong previous year was driven by the IPO and an increase to the threshold for the free use of checking accounts in November last year. The savings volume increased by 2.0% from €40.8 billion at the end of 2004 to €41.6 billion on September 30, 2005.

Successful launch of the pension account
On July 1, 2005, Postbank very successfully launch its new pension account. The sales target of 10,000 contacts to the end of 2005 had already been reached at the end of September. To the end of the quarter, a total of 10,832 contracts with a transaction total of €140 million had been concluded; the volume of previous payments was €33 million.

Outlook
Postbank reiterates its outlook in its structure to date for achieving a return on equity before tax of 15% and a cost/income ratio in the traditional banking business of less than 65%. This does not take account of the BHW acquisition. After the conclusion of the branch project, Postbank plans to publish new medium-term objectives for the combined Postbank Group.

Here you can find the  Income statement (ca. 19 KB)
and the  Balance sheet (ca. 15 KB) .