3rd Quarterly Report 2004.

Transcription

1 3rd Quarterly Report 2004.

2 OVERVIEW OF 3RD QUARTER. KfW Bankengruppe (KfW banking group) promotes the economy with about EUR 38 billion. By the end of September 2004 KfW Bankengruppe achieved a group business volume of about EUR 37.7 billion, EUR 9.3 billion less than in the same period the year before. Last year s commitment figures were characterised by special factors. Altogether we had expected our commitments to decrease. However, we also see the general reluctance to invest and the trend of companies increasingly financing their investments from their own cash-flow, said Hans W. Reich, Chairman of the Board of Managing Directors of KfW Bankengruppe. Apart from this, the financing programmes of KfW Mittelstandsbank registered very positive growth. KfW Mittelstandsbank (KfW SME bank). Promotional loan programmes posted growth. The promotional programmes for SMEs achieved significant growth by the end of September In particular, the volume of the Unternehmerkredit (entrepreneur loan), which was introduced at the end of last year and which is part of the central KfW programme for small and mediumsized enterprises, start-ups and self-employed professionals, increased by more than 20 % over its predecessor programmes to EUR 4.3 billion. With the Unternehmerkredit KfW Mittelstandsbank

3 now offers for the first time a financing product enabling it to reach all small and medium-sized enterprises from start-ups to enterprises with an annual turnover of EUR 500 million and to cover the different needs of SMEs in a differentiated manner. Mezzanine Capital complements loan financing. Restructured since 1st March, 2004, the mezzanine financing offer of KfW Mittelstandsbank s Unternehmerkapital programme for the first time provides a comprehensive and standardised offer of subordinate finance for start-ups, young enterprises and established SMEs and self-employed professionals. Since the start of the programme mezzanine financing has been provided in a volume of around EUR 500 million, as planned. Equity finance on the rise. KfW Bankengruppe has long been an important and reliable partner in the development of Germany s equity market. After years of decline and stagnation the German equity market is again showing increasing dynamism, which is also reflected in the noticeable revival of demand for KfW s financing products. In the first three quarters of the year 2004 the commitment volume has strongly risen by around 30 % to EUR 270 million against the same period of last year.

4 By 30th September 2004, more than EUR 200 million was securitised in a single transaction under the securitisation platform PROVIDE. In the same period last year two transactions were carried out in a volume of EUR 1.3 billion. In the first three quarters of the year 2004 the total financing volume provided by KfW Mittelstandsbank was EUR 7.0 billion, EUR 2.3 billion below the level achieved in the same period last year. The lower volumes of global bonds extended to promote small and medium-sized enterprises in Germany and Europe accounted for much of this decline. In this segment, with its relatively few and irregular transactions, funds committed in the first nine months of this year were EUR 1.4 billion lower than in the same period of last year (EUR 2.6 billion). After the large transactions entered into last year the on-lending banks now first have to make promotional loans from these lines. Much of the decline is also particularly due to the lower utilisation of the securitisation platform PROMISE. After a phase in which commercial banks used the platforms to relieve themselves of some of their equity burden they are now again increasingly looking for interest-bearing credit transactions.

5 KfW Förderbank (KfW promotional bank). Strong rise in commitments for energy conservation and CO 2 reduction. In the first three quarters of 2004, KfW Förderbank committed loans in the amount of EUR 8.6 billion for the promotion of owner-occupied housing and CO 2 reduction in residential buildings. Commitments in this area were EUR 3.9 billion below the previous year s level. The main reason for the decline was the debate on the allowance for owner-occupied housing. This debate greatly increased demand for the Home Ownership Programme last year as a particular one-time effect. As was the case in the promotion of SMEs, global loans for the promotion of housing investment in Germany in Europe as well as the volume of securitisation have declined as well. On the other hand, the promotion of climate protection and housing modernisation in existing buildings posted an increase: energy conservation and CO 2 reduction in the housing sector are of central importance for achieving the national climate protection objective to which Germany has committed itself with its signature to the Kyoto Protocol. As a result of the expansion of the KfW CO 2 Building Rehabilitation Programme from

6 funds of the environmental tax, commitments under the programme in the first nine months of 2004 totalled EUR 1 billion and were 17 % above the level of the previous period. Particularly the partial debt relief of 20 % for the low-energy house in the housing stock was in high demand by the end of September it was granted for 28 % of the loans committed. KfW Housing Modernisation Programme 2003 and Special Fund Growth Impulses strengthen demand for investment and secure jobs. Under the KfW Housing Modernisation Programme 2003 KfW Förderbank committed loans in the sum of EUR 3.3 billion by September Originally endowed with EUR 6.5 billion, the Special Fund Growth Impulses operating under KfW s Infrastructure Programme for municipalities was already fully exhausted at the end of September, four months before it was scheduled to close. Both programmes were launched in April 2003 as elements of the German government s concept for strengthening domestic demand. The interest rate reductions were provided from the federal budget. The investment volume co-financed thus far under both programmes amounts to EUR 22.7 billion. This made it possible to safeguard more than 300,000 jobs, particularly in the construction industry and the suppliers.

7 Dynamic development in renewable energies. In the past four years the share of renewable energies in gross electricity production has risen from 6.7 % in 2000 to currently 10 %. Investment in the expansion of renewable energies was supported in a substantial proportion by KfW s financing programmes. In the first nine months of this year KfW committed loans in the volume of EUR 1.1 billion to promote renewable energies in Germany. By the end of September the programme for the promotion of renewable energies alone posted a rise in loan commitments of 20 % against the same period of the previous year. The demand for loans increased as a result of the amendment of the renewable energy law and, above all, programme improvements introduced in May Among other things, these include the expansion of the eligible group of applicants to municipalities, partial debt relief to promote biomass plants for combined heat and power, and the increase of partial debt relief for biomass plants for heat generation. In addition, financing has also been available since the beginning of this year for the creation of a heating network with biomass plants for heat generation and geothermal plants. Education as an investment in the future. KfW Förderbank offers various financing schemes for investment in human resources. In the first nine months of the year 2004 alone, support has been granted to some 47,000 school and university students as well as skilled

8 workers. KfW Förderbank has co-financed investments in school education, vocational training and university education with loans in the amount of EUR 570 million. The Bildungskredit or student loan developed particularly well. This financing product supports students in more advanced phases of education, for instance after the interim exams, without regard for their parents income or wealth. Here, commitments increased by almost 40 % over the same period last year. Under the securitisation programme PROVIDE residential mortgage loans were securitised in a total sum of EUR 4.7 billion (previous period: EUR 6.8 billion). Commitments of KfW Förderbank totalled EUR 21.5 billion in the first nine months of the year KfW IPEX-Bank. New commitments in the business segment KfW IPEX-BANK amounted to approx. EUR 8 billion as per September 30 (EUR 9.0 million). Thus we have already reached the target corridor of EUR 8 10 billion for the entire year. Commitments abroad for export transactions and direct investments of German and other European companies totalled EUR 4.5 billion, investment financing within

9 Germany EUR 3.5 billion. The business areas raw materials, manufacturing industry and shipping have expanded with particular dynamism. In its foreign lending business KfW IPEX-Bank has financed the investment of a Thai enterprise in the construction of a PET plant in Lithuania together with Nordea, the financial services provider of the Nordic and Baltic regions, and others. In Brazil it has provided a USD 200 million facility as lead arranger together with other banks for the construction of an aluminium factory and a steelworks. In Romania it is financing modernisation investments in power distribution plants. The bank is financing container vessels for a Turkish shipping company that are being built by Germany s Peene-Werft shipyard. In Germany KfW IPEX-Bank is participating in the long-term acquisition financing for the takeover of Germany s largest water utility Gelsenwasser AG. In Saxony-Anhalt it is financing the construction of a thermal waste treatment plant. An innovative financing model on the basis of a public-private partnership was developed for the renovation and expansion of the district administration building of the city of Unna. Under this model the district of Unna transfers financing risks to private partners and is relieved of project risks while the private partners can count on long-term revenues.

10 KfW Entwicklungsbank (KfW development bank). In the field of Financial Cooperation with developing countries KfW Bankengruppe and DEG increased their commitments for the promotion of developing and transition countries to EUR 1.3 billion by the end of September 2004 (previous period: EUR 1.2 billion). Commitments of FC development loans increased substantially from EUR 70 million to EUR 186 million. KfW Entwicklungsbank again sponsored the developing countries prize which is awarded by the Justus-Liebig-University every two years for outstanding research work related to developing countries. KfW Entwicklungsbank has been sponsoring the award since 1989 in order to strengthen the dialogue between the development research community and development practitioners and to give researchers, especially young academics, an incentive to work on developmental issues. This year s prize was awarded for research work conducted on the topic of Water and Sustainable Development.

11 Funding. KfW s funding volume totalled EUR 43.3 billion in the period under review. Nearly half of this sum was raised in the capital market through the issuance of securities in Euros and one-third through securities denominated in US dollars. Bonds in pounds sterling, Japanese yen and 10 other currencies together account for the equivalent of around EUR 9.7 billion. KfW still expects its funding volume for the year as a whole to reach a total of EUR billion by the end of the year.

12 Group Figures for KfW Bankengruppe, in EUR billion Jan 1 Sep 31 Jan 1 Sep 31 I. KfW Mittelstandsbank Loan Financing of which: Unternehmerkredit Global Loans for Commercial Enterprises Mezzanine Financing Equity Financing PROMISE Securitisations II. KfW Förderbank Housing Investments of which: Global Loans for the Housing Industry Education Municipal Infrastructure Environmental Investments Global Credit Lines to Special Credit Institutions of the Federal States PROVIDE Securitisations Investment Finance in Germany and Europe III. KfW IPEX-Bank Manufacturing, Telecommunications, Raw Materials Energy, Environment Transport and Transport Infrastructure AKA Export Credits IV. KfW Entwicklungsbank V. DEG Total Financing Volume Environmental and Climate Protection Funds raised Group Balance-sheet Total As of September 1, 2003, the KfW SME Programme and the DtA Start-up Programme were combined to create a new product the Unternehmerkredit, or Entrepreneur Loan including the variants Leasing, Abroad, Working Capital, and GuW (Start-up and Growth Financing). 2 Contained in the total financing volume as cross-cutting promotion of KfW Mittelstandsbank and KfW Förderbank KfW Bankengruppe Palmengartenstrasse 5 9, Frankfurt am Main, Germany Telephone , Fax info@kfw.de,