WIESBADEN (dpa-AFX) - Aareal Bank AG (AAALF.PK), a German lender, on Thursday reported a rise in profit from continuing operations for the nine-month period. It also reported higher net interest income for the period.
However, the net profit for the period dropped particularly reflecting a loss from discontinuing operations of Aareon. In addition, the company has reaffirmed its profit annual outlook.
For the nine-month period to September 30, the bank registered a net profit of 24 million euros, lower than 104 million euros, recorded for the same period last year.
However, net earnings from continuing operations rose to 185 million euros as against previous year's 154 million euros in 2023.
Net income from discontinued operations was negative 161 million euros, compared with prior year's negative 50 million euros. This includes Aareon's profit as well as transaction-related expenses of around 175 million euros from the Aareon sale. The disposal gain after transaction-related expenses will be approximately 2 billion euros, which will be recognized in the fourth quarter.
Net commission loss was 1 million euros as against prior year's profit of 30 million euros, offset by both new and increased commission expenses incurred in connection with the strategic partnership with Aareon and First Financial Software GmbH since January 1.
Net interest income, however, jumped to 792 million euros from last year's 734 million euros. This shows the year-to-date increase in the average credit portfolio size together with solid margins and normalized interest rate levels, and also the continued high volume of deposits from the housing industry.
As of September 30, deposits from the housing industry was 12.530 billion euros, while the nine-month average figure stood at 13.7 billion euros.
Looking ahead, for the full year, the bank continues to expect net profit of around 2.2 billion euros as a result of the Aareon sale. This includes a gain from the disposal that is likely to be in the region of 2 billion euros after transaction-related expenses.
The Group still projects its annual operating profit from continuing operations to be in the range of 250 million euros to 300 million euros.
(Amendment: Changes figures of deposits from the housing industry on clarification from the co.)
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