NORD/LB: Continued expansion of corporate banking business in Saxony-Anhalt
NORD/LB Landesbank for Saxony-Anhalt has further expanded its business with customers in the SME sector, and 2012 saw the bank's financing volume in corporate banking up by 3.4 percent to EUR 1,879 million (2011: EUR 1,817 million). The trend within the corporate customers segment was particularly positive in the sphere of agricultural banking, with business volume growth of 4.3 percent. Further focal spheres of NORD/LB's business activities in Saxony-Anhalt lie in the financing of residential housing, the arranging of capital market products for SMEs and involvement in major projects in the fields of renewable energies and public infrastructure.
"NORD/LB has been active as bank for the SME sector in Saxony-Anhalt for over 20 years now", as Dr. Hinrich Holm, member of the NORD/LB Managing Board, told journalists last Friday in Magdeburg. "During this period we, in collaboration with the regional Sparkasse savings banks, have built up a strong market position. Our aim for the coming years is to further expand our corporate customer business – throughout Germany but especially in Saxony-Anhalt as well. We are and remain a solid and reliable partner for small and medium-sized enterprises."
NORD/LB's corporate banking activities cover all sectors of the regional economy in Saxony-Anhalt, with particular emphasis in recent times on activities among providers, automotive component suppliers and wood processing companies. Besides this, NORD/LB has also played a key role in the modernization of municipal facilities within the framework of public-private partnership models.
"We offer business enterprises in Saxony-Anhalt the entire spectrum of options in the field of financing, a significant part of which is accounted for by classic working capital and investment financing", continued Dr. Holm. "However, we also enable our SME customers access to capital market products, for example in the form of promissory note loans. The focus in these activities is always on providing a solution tailored to the specific needs of each individual customer."
Growing importance of renewable energies in agricultural banking
With the business volume up by 4.3 percent in 2012, the growth in the field of agricultural banking is largely attributable to the original agricultural lending business (in particular for the financing of land purchases, investment in farm buildings and facilities and the takeover of farming operations). That said, the sphere of renewable energies is taking on an increasingly important role in NORD/LB's agricultural business as well, though legislative changes not surprisingly slowed demand for the financing of biogas plants as against the preceding year. As regards the ongoing fiscal year, NORD/LB expects to see renewed high-growth development in original agricultural lending business while the renewable energies sub-segment can be expected to register a slight downward business trend.
With Magdeburg as centre of operations for Germany as a whole, NORD/LB's activities in the residential housing segment virtually stagnated (-0.7 percent) in terms of the financing volume in Saxony-Anhalt in 2012; this was due to an already high market share and the relatively low volume of new-builds. On the other hand, however, NORD/LB significantly expanded its business volume in the residential housing segment at the national level to a current figure of over EUR 3.2 billion.
The reason for the downward trend (-7.4 percent) in the financing volume in public customers segment lies not only in an improved situation in terms of revenues among the municipalities but also in the "STARK" programme imposed by the state government of Saxony-Anhalt to provide support for municipalities looking to reduce their indebtedness. These two factors have had the result of markedly reducing the demand for loans among public customers.
The most important project in the sphere of energy and infrastructure customers in Saxony-Anhalt was the financing of the "Krughütte" solar park located near Lutherstadt Eisleben. With a nominal capacity of around 30 megawatts and a financing volume of approximately EUR 35 million, the facility was planned with the significant involvement of a company based in Berga in Saxony-Anhalt and built in a record time of just six weeks. NORD/LB will be expanding its commitment in the field of renewable energies, and is currently involved in the definitive preparation of two further projects in Saxony-Anhalt.
NORD/LB's business with Sparkasse savings banks and institutional customers is marked by a downward trend, attributable to the current market situation, in particular to the extremely low interest rate levels. The sharp decline in this business segment (-18.1 percent) largely explains the contraction in NORD/LB's overall financing volume in Saxony-Anhalt.
As institution of NORD/LB, the Saxony-Anhalt Investment Bank (IB) has continued its positive trend and further established itself as the federal state's central development bank. "The companies in the SME sector can rely on us even in exceptional situations. This is something we have just proven again through our implementation of the flood aid measures, with the immediate activation of the toll-free helpline for use at the weekend as well, prompt organization of on-the-spot meetings in the regions and our offer of rapid provision of assistance for business enterprises", emphasized Henning Schwarz, IB Managing Director. "In the meantime we have already received 629 applications with a total volume of EUR 12.3 million. A large part of this amount has already been paid out, and we are at the ready for supplementary measures as part of the reconstruction activities."
Business development of NORD/LB Landesbank for Saxony-Anhalt in 2012
|31.12.2012 (€ million)||31.12.2011 (€ million)||Change (%)|
|Overall financing volume||4,330||4,502||-3.8|
of which residential housing business
of which agricultural banking
|Sparkasse savings banks and institutional customers||949||1,159||-18.1|
|Other spheres of activity||545||492||10.8|
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