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Strategic adjustment and cost-cutting measures taken by the Board of Directors bear their first fruit - Baader Bank breaks even in the first quarter of 2019

DGAP-News: Baader Bank AG / Key word(s): Quarter Results

30.04.2019 / 12:20
The issuer is solely responsible for the content of this announcement.

Corporate News


Strategic adjustment and cost-cutting measures taken by the Board of Directors bear their first fruit - Baader Bank breaks even in the first quarter of 2019

Unterschleissheim, 30 April 2019: After posting significant annual losses for 2018, the adjustments made by the Board of Directors to the Group structure and the overall bank strategy, plus the implemented cost-cutting measures, are beginning to bear fruit. The downward trend in operating business, particularly over the last two quarters of the previous financial year, with negative earnings before taxes of EUR -5.6mn and EUR -12.2mn respectively, was halted. For the first quarter of 2019, the Baader Bank Group reported slightly positive cumulative earnings of EUR 0.3mn before taxes.

Inconsistent net trade and commission income

At EUR 9.7mn, net commission income remains at the level of the previous year (Q1 2018: EUR 9.8mn) and slightly lower than in the previous quarter (Q4 2018: EUR 11.6mn). A rather subdued start to the financial year for the subsidiary Baader & Heins Capital Management AG and the Baader Helvea Group was offset by significantly higher net commission income in the Multi Asset Brokerage business unit. In this respect, Baader Bank was able to gain market share from equity brokerage. At EUR 12.4mn, net trade income was below the previous year's level (previous year: EUR 15.9mn), but significantly higher than the values for the previous quarter (Q4 2018: EUR 7.4mn). Overall, the Bank's market making activities, mainly in equities and securitised derivatives, continue to show a decline in trading volumes.

Revenues of EUR 3.5mn (Q1 2018: EUR 3.6mn; Q4 2018: EUR 3.6mn), net interest income of EUR -0.3mn (Q1 2018: EUR -0.3mn; Q4 2018: EUR 0.3mn) as well as current income of EUR 0.2mn (Q1 2018: EUR 0.1mn; Q4 2018: -0.3mn) remain largely unchanged from the levels of the same period in the previous year and represent a negligible contribution to earnings.

Cost-cutting measures are taking effect, and a solid capital and liquidity base is in place

Savings measures are beginning to take significant effect. For example, cumulative Group-wide expenses at the end of the first quarter of 2019 were EUR -26.3mn (Q1 2018: EUR -29.4mn; Q4 2018: EUR -36.0mn). The Group's expenses are therefore significantly down on the previous year. Personnel expenses for the Group fell to EUR -11.8mn due to lower variable parts, restructuring measures and a targeted personnel policy (Q1 2018: EUR -13.2mn; Q4 2018: -16.9mn).

With a balance sheet equity ratio of 10.4% (Q1 2018: 12.3%; Q4 2018: 10.7%), a modified equity ratio of 13.5% (Q1 2018: 15.9%; Q4 2018: 13.8%) and total assets of EUR 720.4mn as at the reporting date of 31 March 2019 (Q1 2018: EUR 789.5mn; Q4 2018: EUR 713.2mn), Baader Bank is well capitalised. The total supervisory capital ratio stands at 14.3% (Q1 2018: 15.9%; Q4 2018: 14.3%).

Group restructuring completed in the first half-year

Following a very challenging 2018 financial year and annual figures reflecting this (see Corporate News dated 22 March 2019), Baader Bank implemented extensive measures to improve and further develop its business activities.

In addition to reducing the size of the Board of Directors and carrying out an extensive strategic review in which Baader Bank is focusing on its core activities and skills, cost-cutting and personnel measures have also been implemented. The number of employees of the Baader Bank Group was reduced as at the reporting date to 426 (Q1 2018: 448; Q4 2018: 441). Further benefits from the measures already taken will be realised over the course of the year.

At the same time, the Group structure is being significantly streamlined. To this end, the stake in Conservative Concept Portfolio Management AG (Frankfurt am Main, Germany) has already been reduced to 20%, and the investment in Gulf Baader Capital Markets S.A.O.C. (Muscat, Oman) has been sold off completely.


Most business activities continue to show growth in the first part of the year

In the Corporate Brokerage growth segment, nine new mandates were added in the first quarter. As at the reporting date 31/03/2019, Baader Bank provided 46 companies with services relating to designated sponsoring and capital market processing.

With regard to banking activities involving traditional asset managers and online asset managers, the number of managed accounts/custody accounts at Baader Bank increased from 24,500 to 27,500 in the first quarter, accompanied by an increase in the volume of custody accounts from EUR 3.5bn to EUR 3.8bn. Among the new high-profile client platforms are OSKAR and VTB Bank.

bnbnThe performance in the research market, which has come under heavy pressure from MiFID II, is also encouraging, driven mainly by the successful cooperation with our business partner AlphaValue. We were able to gain market share, particularly inequity brokerage, as well as from gaining a number of new international clients. Baader Bank continues the dynamic growth in the whole client business.

The restructuring measures initiated, a more streamlined organisational structure and an adjustment in the strategic orientation of the Group, the Bank and its business lines should lead in the medium term to Baader Bank gradually regaining its profitability in what remains a challenging market environment. We do not anticipate any changes in our forecasts based on the performance in the first quarter of 2019. Baader Bank's annual report for 2018 will be made available in the "Financial Reports" section of the Company's website in mid-May 2019 when the annual shareholders' meeting is convened.

Overview of key figures

BAADER BANK GROUP Q1 2019 Q1 2018 Delta
Income 26,643 29,660 -10.2
of which net interest income and current income -142 -228 -37.7
of which net commission income 9,684 9,838 -1.6
of which net trading income 12,445 15,899 -21.7
of which revenue 3,531 3,567 -1.0
of which other income 1,125 584 92.6
Expenses -26,313 -29,357 -10.4
of which personnel expenses -11,796 -13,207 -10.7
of which administrative expenses and other operating expenses -11,521 -11,364 1.4
of which amortisation and depreciation -2,996 -4,738 -36.8
of which net income from interests in associates 0 -48 -100.0
Earnings before taxes (EBT) 330 303 8.9
Operating result * 461 2,353 -80.4
Total assets 713,190 764,844 -6.8

In accordance with the provisions of the German Commercial Code (HGB)
*Gross profit less personnel and other administrative expenses as well as depreciation and amortisation on intangible assets and property, plant and equipment

Further information is available from:

Baader Bank AG
Weihenstephaner Strasse 4
85716 Unterschleissheim, Germany

Florian E. Schopf
Company Spokesperson
Managing Director
Head of Group Strategy & Communication

T +49 89 5150 1013
M +49 160 718 88 26

About Baader Bank AG:

Baader Bank is the bank for the capital market. It allows its clients to access international capital markets and to invest in financial products in an effective, efficient and secure manner. The bank uses the latest innovations in the banking industry for products, processes and technology to generate added value for its clients. As a family-run, full-service bank with its headquarters in Unterschleissheim near Munich with around 425 employees, it is active in the business lines of Market Making, Capital Markets, Multi Asset Brokerage, Asset Management Services, Banking Services and Research.

Further information can also be found online:

Company website:


30.04.2019 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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