Targets 2009 and outlook

The metamorphosis of the financial markets crisis into a global economic crisis means the business environment will remain challenging in 2009. Banks will feel the pinch as corporate clients struggle and the quality of ordinary loans deteriorates.

Government action to boost banks’ liquidity has been beneficial, but capital markets remain dislocated, with interbank lending still hesitant.

The corporate market is subdued as companies postpone their borrowing needs if at all possible. With our strong capital buffers and a firm grip on liquidity, however, we are very much open for business and keen to participate in carefully-chosen transactions in 2009 and beyond.

Targets

• We aim to grow our corporate loan book, focusing our tightly-controlled liquidity on the mid-cap companies that are our core client group;
• We will maintain our policy of funding diversification and our sound liquidity position;
• We aim to keep our Tier-1 ratio clearly above 10%, as we have done in recent years;
• We aim to lower costs further after a 14% reduction in 2008;
• We will maintain tight credit risk control, keeping a close watch over credit portfolios;
• We aim to serve our clients even better with financing, advice and support and to achieve the best possible business performance given the difficult conditions; and
• We will expand our activities in Germany and aim to build it into a home market.

Our modest size and integrated organisation give us the agility to act and react fast to evolving client needs and changing market circumstances. We are not immune from the persistently challenging environment, yet we are in robust shape.