Losses 2008 Didn't Shake KAS BANK's Stable Liquidity And Solvency Position

Profit excluding exceptional items is down 20% at 18.8 million (2007 23.6 million). Net profit is 39.9 million negative, reflecting impairment losses. BIS ratio increases to 18% as at 31 December 2008 (year end 2007 14%), with Tier 1 capital

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Profit excluding exceptional items is down 20% at 18.8 million (2007: 23.6 million). Net profit is 39.9 million negative, reflecting impairment losses. BIS ratio increases to 18% as at 31 December 2008 (year-end 2007: 14%), with Tier 1 capital of 15% (year-end 2007: 13%).

Excluding exceptional items, operating profit in 2008 was down 20% at 18.8 million (2007: 23.6 million). Despite the market turbulence and lower stock market prices, income was only fractionally lower, down 1 million at 132.3 million (2007: 133.2 million). Operating expenses were 5.7% higher.

Compared with 2007, interest income was 33% higher at 28.9 million (2007: 21.6 million), reflecting a wider interest margin on virtually stable client volumes. Commission income was down 4.5% at 89.2 million (2007: 93.4 million).

Despite everything, KAS BANK posted a reasonable operating profit in 2008, says Albert Rell, chairman of the banks Managing Board.

While we of course feel responsible for the losses that have occurred, we note that our core services performed well under pressure and that KAS BANK still enjoys its clients full confidence.

By reducing our balance sheet, we have limited the risks as far as possible and maintained an excellent solvency and liquidity position throughout the year. With a Tier 1 ratio of 15% and a BIS ratio of 18%, KAS BANK is among the most solvent banks in the market. That reflects our endeavour to maintain a low risk profile and our refusal to take unnecessary risks at the expense of our clients.

L.D.

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