Operating income

 

The difficult market circumstances in 2008 affected the development of Operating income, which decreased from EUR 474 million to EUR 337 million.

 

In 2008, Net interest income decreased by 11% to EUR 213 million (2007: EUR 238 million), mainly reflecting a lower average corporate loan portfolio during 2008 as a result of the lower business volume in the current market. The residential mortgage portfolio remained stable during 2008.

 

Net fee and commission income decreased in 2008 by 31%, from EUR 62 million to EUR 43 million. This mainly results from the low level of lending origination in 2008. Fee income from M&A activities saw a slowdown in the second half of the year as a result of the deteriorating economic environment.

 

Dividend income decreased by 40% from EUR 84 million to EUR 50 million, mainly reflecting lower dividends from equity investments and - to a lesser extent - a decrease of the average structured investments portfolio in 2008.

 

Net trading income increased from a loss of EUR 24 million in 2007 to a gain of EUR 84 million in 2008. In 2008, Net trading income was positively affected by repurchases and revaluations of liabilities.

 

Gains less losses from financial assets decreased from a gain of EUR 107 million in 2007 to a loss of EUR 62 million in 2008. The loss in 2008 is mainly due to negative fair value adjustments and impairments on a number of equity investments caused by the turmoil in the financial markets. Furthermore, in both 2008 and 2007 gains were realised on a number of exits.

 

The Share in result of associates increased in 2008 from EUR 1 million to EUR 8 million, which is mainly explained by revaluation of associates related to our real estate and shipping business.