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May 03, 2005

Commerzbank achieves high consolidated profit in first quarter of 2005

Maintaining its cost discipline, Commerzbank achieved a pre-tax profit of 541m euros in the first quarter of 2005, largely thanks to a good trading profit and high earnings on its investments and securities portfolio. The consolidated profit of 395m euros (+60.6%) remaining after taxes and minority interests was already higher than the net profit for the whole of 2004.

The trading profit reached an encouraging 262m euros in the first quarter, even though activities were considerably scaled down due to the restructuring of investment banking. The net result on the investments and securities portfolio largely reflects the disposal of stakes in MAN and Unibanco. The slight decline in net interest income (-2.7%) is mainly due to the much weaker treasury result. However, as provisions calculated on a pro-rata basis could be reduced further to 198m euros, net interest income after provisioning was 4% higher than a year previously. Net commission income (-3.2%) showed little change on the very strong 2004 result.

Consolidated income statement (in million euros):

Q1 2005Q1 20041)Change in %
Net interest income721741-2.7
Provision for possible loan losses(189)(238)-16.8
Net commission income578597-3.2
Trading profit262314-16.6
Hedge accounting(12)4.
Net result on investments/securities portfolio29454.
Operating expenses1,1071,112-0.4
Other operating result367-95.5
Operating profit541427+26.7
Regular amortization of goodwill-20.
Pre-tax profit541407+32.9
Taxes116128-9.4
After-tax profit425279+52.3
Consolidated profit395246+60.6
Earnings per share in euros0.660.41+61.0
Pre-tax return on equity2)21.4%15.9% 
Operating cost/income ratio60.0%62.6% 

1) The new IAS/IFRS rules valid as from 1.1.2005 have also led retroactively to minor changes in the balance sheet and income statement for the first quarter of 2004. Details may be found on pages 5 and 6 of the interim report.

2) annualized; minus figures in parentheses.

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