• Net growth of overall loan portfolio above 8% expected, adjusted from previous forecast of 5% – 8%
• For the core segment of loans over EUR 30,000 growth above 10% is expected, replacing the former expectation of around 10%
• Return on equity forecast between 7% and 9% remains unchanged
• CET1 capital ratio forecast above 13% (upon completion of the sale of institutions in El Salvador and Nicaragua) remains unchanged
Frankfurt am Main, 7 July 2017 – The Management Board of ProCredit General Partner AG (the general partner of ProCredit Holding AG & Co. KGaA, which is the parent company of the international ProCredit group) has raised its forecast for the 2017 financial year on the basis of preliminary figures for the first half of the year. The grounds for adjusting the forecast were the operational performance during the first half of the year, which was substantially better than anticipated at the start of the period, and the expectation that performance will continue to be good in the second half of 2017.
Initially, it was expected that overall customer loan portfolio net growth would range between 5% and 8% during the 2017 financial year. The Management Board now expects the net growth of the overall customer loan portfolio in 2017 to be above 8%. Growth in the core segment of loans over EUR 30,000 had been expected to be around 10% in the 2017 financial year. Growth in this core segment is now forecast to be above 10% in 2017. The Management Board will define the forecast in greater detail after a complete review of the figures for the first half of 2017.
Borislav Kostadinov, Member of the Management Board of ProCredit General Partner AG (personally liable managing partner of ProCredit Holding AG & Co. KGaA), explains: “We were able to benefit from the strong increase in demand for business loans in the South Eastern and Eastern Europe segments in the first half of 2017. Our growth was greater than expected at the start of the year in almost all countries in these segments, with business loan disbursements increasing exceptionally in both Bulgaria and Ukraine. This growth is the result of our strategic focus on small and medium businesses with good prospects to expand and develop. Our very good performance in the first half of the year underlines the strength of our business model, which is clearly oriented towards serving as the ‘Hausbank’ for these businesses.”
The forecasts for return on equity (RoE) and the CET1 capital ratio remain unchanged. Taking account for the general development of margins in the banking sector and the strategic withdrawal from the segment of loans below EUR 30,000, as described in the 2016 Annual Report, the RoE for the 2017 financial year is still expected to range between 7% and 9%. The CET1 capital ratio is expected to be above 13% after the sale of the institutions in El Salvador and Nicaragua.
ProCredit Holding AG & Co. KGaA’s report on the first half of 2017 is scheduled for publication on 14 August 2017.