Baader Bank significantly improves operating performance despite volatile financial market conditions in the first half of 2015

Baader Bank significantly improves operating performance despite volatile financial market conditions in the first half of 2015

Despite a volatile capital market environment, the Baader Bank Group achieved a substantial improvement in its operating performance, with net fee and commission income and net trading income both well up on the prior-year period while expenses began to see the benefits of the group's cost-cutting program.

Net interest income was negative at EUR-0.1 million, following the portfolio restructuring towards non-interest-bearing assets. The overall current investment income rose to EUR1.2 million.

Net fee and commission income improved by 19.8%, reaching EUR27.3 million. This growth was mainly attributable to a marked increase in commission income from the Corporates & Markets division. The division significantly increased its commissions from both the cash equities business and from capital markets transactions. This increase more than offset the loss of income from the interbank bond trading business that was discontinued last year. Baader Bank further strengthened its position in capital markets business in the first half of 2015, acting as lead manager in four successful placements.

Net trading income also increased significantly, rising by 21.2% to EUR31.7 million, largely thanks to a good performance in market making for funds and ETFs. The increase in OTC trading is especially encouraging. During the period, Baader Bank concluded new agreements with additional prominent order flow providers in this area.

Administrative expenses were slightly higher, increasing by 2.2% to EUR51.8 million overall. This heading includes personnel expenses, which rose by 5.8% as a result of higher variable remuneration and higher pension costs. However, the cost-cutting measures implemented at the start of the year are already bearing fruit, and meant that other administrative expenses could be reduced by 3.0%. The programme is expected to continue having a positive impact on Baader Bank's earnings in the second half of 2015 and from 2016 onwards.

Despite the encouraging performance by the operating units, operating profit declined by 6.7% to EUR3.5 million. This was attributable to a decline of EUR8.0 million in Other income. Earnings after taxes stood at EUR2.7 million, the same level as in the prior year.

Among the subsidiaries, the Helvea Group achieved a significant positive result in the first half of this year. Baader & Heins Capital Management AG also made a positive contribution to the consolidated net profit. The Conservative Concept Portfolio Management Group was the only part in deficit, generating a small loss for the period.

Taking into account the fund for general banking risks, the Baader Bank Group had own funds of EUR134.6 million as at 30 June 2015 (31 December 2014: EUR132.0 million). The equity ratio was 17.3% as at the reporting date (31 December 2014: 16.4%).

As at 30 June 2015, the Baader Bank Group employed 460 staff (30 June 2014: 487).

The consolidated half-year report for 2015 is available on Baader Bank's website in the Financial Reports section.