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ePaper created 2013-04-15, 17:20:51 | version 1.25.7
Letter from the Board of Management 7 MünchenerHyp’s Pfandbriefe generated attention in the market The Pfandbrief once again proved to be a reliable refinancing instrument during times of greater volatility in the capital mar- kets. Its high quality combined with MünchenerHyp’s excellent standing as an issuer with national and international investors enables us to obtain refinancing at very good conditions. As a result, we were able to place our Mortgage and Public Pfand- briefe with low risk premiums, which in some cases were at historic low levels. We received the renowned “Euro Deal of the Year” award for a Jumbo Mortgage Pfandbrief with a ten-year term. Institutions within the Cooperative Financial Network were once again our most important and reliable partners in the uncovered refinancing segment. Regulatory challenges Despite the previously described favourable developments, we were seriously challenged in numerous areas during 2012. This primarily refers to the effects of already implemented regula- tory requirements, as well as those we will face in the future. The new regulations will materially influence the business mod- els and capital adequacy requirements of credit institutions. In order to be prepared for these changes we also worked on projects last year that were of significant importance for the sustainable development of MünchenerHyp, in addition to en- suring that we can fulfil regulatory requirements. One example of our project work was the continuation of the IRBA Project – Internal Ratings Based Approach to determine equity capital requirements –, which was successfully introduced in 2011. The expanded employment of IRBA will allow us to achieve a further easing of our capital requirements. Furthermore, it will also ena- ble us to substantially meet the new equity capital requirements while continuing on our course of growth. safe investment opportunities. Both our new mortgage business and our refinancing activities benefited from this situation in 2012. This is because MünchenerHyp is highly valued by its part- ner banks, customers and investors as a solid reliable and trust- worthy enterprise. This trust is an important underlying element of our strategy of solid and sustainable growth. New mortgage business and portfolio grow anew Our new business developed very favourably due to the heavy demand for long term residential property financing in Germany as in the previous year. We posted substantial gains. Above all, we were able to notably expand the volume of new lending commitments made in collaboration with our partner banks in the Cooperative Financial Network. This figure rose by about 25 percent. New business results grew in both of our two core businesses of residential and commercial property financing. Our total new mortgage business amounted to € 3.6 billion, which was the highest level noted since the onset of the financial market crisis five years ago. We were once again able to acquire larger volumes of new commercial property financing business, espe- cially in Germany, without deviating from our conservative lending policies. The favourable development of our new business supported the expansion of our loan portfolio. Meanwhile, mortgage loans represent a good two-thirds of our total portfolio: We were able to increase the volume of mortgage loans in our portfolio by 8 percent to € 21.0 billion. This growth did not take place at the expense of the risk situation, which contin ued to improve last year. Our lending business with the public sector and banks declined considerably. This change is the result of our strategic focus and at the same time reflects the current situation in the area of public sector financing.