HSH Nordbank committee discusses realignment
Hamburg/Kiel, December 16, 2008 - The Management Board and Supervisory Board of HSH Nordbank discussed in this Monday’s Supervisory Board meeting a comprehensive strategic realignment of the bank.
The Management Board of HSH outlined its proposal for the reduction of portfolios, the spin-off of non-strategic activities, and the structure of a regional core bank. The total assets of the core bank are set to be considerably decreased. Certain activities which are commercially anchored in the region of North Germany will be pooled.
“The changes in the global banking landscape necessitate a significant restructuring of HSH Nordbank. Our aim is to ensure that the bank once again has the sufficient flexibility needed in its regionally anchored core fields”, said HSH Nordbank CEO Dirk Jens Nonnenmacher. The decision about the realignment of HSH Nordbank will be made in February 2009, following discussions with the federal state parliaments, federal state governments, and the Savings Bank and Clearing House Association of Schleswig-Holstein.
The model proposed by the Management Board sets out that the core business units Corporate Clients, Private Banking, Savings Banks and Real Estate, will in the future have an even greater focus on North Germany and domestic clients. The business unit Renewable Energy will concentrate on Europe. It is planned that the Shipping and Transportation units will continue to comprise the bank’s core business and retain their global focus. Transportation will concentrate primarily on the areas of Aviation and Infrastructure Finance. “The business units Shipping and Transportation have their roots in our North German Corporate Clients business. Together with our clients, we have enjoyed strong growth on a global scale here over the past decades. And our clients have the right to expect our international presence in these areas,” said Nonnenmacher.
In September, HSH Nordbank decided to scale down its Leasing Operations, the international Leveraged Buyout business, Real Estate business in New York, and its Credit Investment Portfolio.
“By taking these measures, we aim to bolster our regional presence and the bank’s financial strength. At the same time, we are minimizing risks and thus keeping all conceivable strategic options open”, said Dr. Nonnenmacher.
HSH Nordbank can not extricate itself from the global financial crisis. Only recently, a market value write-down of EUR 450 million was the result of the reclassification of a portfolio of structured products in the balance sheet. Further write-downs are expected in Q4. The operative client business remains profitable for the bank.
Since the end of November HSH Nordbank has been able to draw on a government liquidity guarantee of up to EUR 30 billion. Moreover, by the end of February 2009 HSH Nordbank shareholders will ensure that the bank’s Tier 1 capital ratio increases from 7.4 percent (September 30, 2008) to at least 8.0 percent.
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