HSH Nordbank Supervisory Board approves 2008 financial statements

Preliminary Q1 figures for 2009 better than budgeted

Hamburg/Kiel, April 27, 2009 - At its meeting today the Supervisory Board of HSH Nordbank unanimously approved the HSH Nordbank 2008 consolidated financial statements.

According to audited IFRS figures, the loss before taxes, restructuring expenditure and losses absorbed came to EUR 2.6 billion. This means that the loss is some EUR 200 million lower than the preliminary figures published in February 2009. After taxes, restructuring expenditure and losses absorbed the consolidated loss works out to EUR 2.7 billion. Consolidated net income in fiscal 2007 was EUR 270 million.

The preliminary results in the first quarter of 2009 are better than budgeted. Among other things, this is attributable to the uptrend in net interest income. Furthermore, HSH Nordbank has achieved stable net commission income – in spite of the difficult market setting. By contrast, the Credit Investment Portfolio is continuing its downtrend. In the first three months of this year the Group also had to make writedowns that are above budget. Risk provisioning in the conventional lending business – i.e. including shipping – is on target, as are costs for the period under report.

“It is gratifying to note that the result for the first quarter of 2009 is better than expected. Nevertheless the crisis is a long way from over. We have to carefully monitor and manage developments and possible risks in the Credit Investment Portfolio as well as in conventional lending operations”, said CEO Dirk Jens Nonnenmacher. "We shall implement the realignment of the Bank consistently and at full pace, but also as circumspectly as required.”

The Bank is working hard on implementation of a restructuring unit where around half of current total assets of some EUR 200 billion are to be pooled. The restructuring unit is primarily to be used for managing portfolios that no longer form part of the Bank’s strategic business units, such as leasing operations. Portfolios with a high risk of default are also to be part of the restructuring unit. However, their share in the total amount is small and relates principally to structured capital market products in the Credit Investment Portfolio. Their volume comes to around EUR 13 billion. The Bank cannot therefore comprehend the figures published by the media on the basis of a list from the Federal Financial Supervisory Authority (BaFin).