De Volksbank posts first half 2017 net profit of € 177 million

Increased customer appreciation and continued growth in current account customers and market share mortgages; good progress in the execution of our shared value strategy

Optimising shared value

  • Continued focus on optimising shared value starting to yield results:
  • Customers: Net growth current account customers by 42,000 to 1.37 million; improvement customer weighted Net Promoter Score to -4 (2016: -8)
  • Collaboration agreement with Pivotus to contribute to our mission of banking with a human touch
  • Data safety: no sale of customer data on an individual or aggregate level
  • Society: 25% climate neutral balance sheet (2016: 22%)
  • Shareholder: Return on Equity of 10.0% (first half of 2016: 10.8%)

Commercial developments

  • Market share new retail mortgages higher at 6.8% (first half of 2016: 4.8%); sharp increase in new retail mortgage production to € 2.5 billion (+67%)
  • € 0.4 billion increase in retail mortgage portfolio to € 45.3 billion (year-end 2016: € 44.9 billion)
  • Market share new current accounts of 20% (first half of 2016: 25%)
  • 2% increase in retail savings balances to € 37.4 billion; market share stable at 10.7%

Financial performance

  • Net profit virtually stable at € 177 million (first half of 2016: € 181 million)
  • Lower net profit adjusted for incidental items of € 178 million (first half of 2016: € 193 million) due to lower net release of loan provisions
  • Net interest income 2% lower year-on-year; net interest margin virtually stable at 1.50%
  • Adjusted cost/income ratio lower at 52.5% (first half of 2016: 54.2%) due to 5% lower adjusted operating expenses
  • Net release of loan provisions of € 20 million (first half of 2016: € 45 million); 22% decrease in retail mortgage loans in arrears to € 0.5 billion
  • Increase in Common Equity Tier 1 ratio to 32.6% (2016: 29.2%); leverage ratio: 5.5% (2016: 5.2%)

“In the first half of 2017 we have made good progress in optimising the value of our bank for all stakeholders, i.e. customers, society, employees and our shareholder. We laid the groundwork for the further strengthening of our social identity and lowered our cost base, while at the same time executing a smart adopter innovation strategy. Positive developments in our shared value metrics, such as customer satisfaction, our current account customer base and the climate neutrality of our balance sheet, indicate that we are on the right track with our new approach to banking.
Net profit remained at a high level. Net interest income was only marginally lower as we were able to offset the pressure on mortgage rates by growing our retail mortgage portfolio and slightly lowering our savings rates. The credit quality of our retail mortgage portfolio improved further. Our capital and liquidity position remained strong, providing a solid basis to absorb the impact from new regulations, such as Basel IV, and to continue to put our strategy into practice”, says Maurice Oostendorp, Chairman of the Board of Directors of de Volksbank.

Press releases