A4 für Copyshop GB.indd - Bayerische Landesbank

100 Report on the Bank and the Group
} Payment settles
EU state aid
proceedings
} Net income
for the year
} Corporates
segment result
The operating result does not include extraordinary expenses amounting to EUR 358
million in the Group, and EUR 357 million at BayernLB. Of these figures, EUR 320 mil-
lion relates to the payment to the Free State of Bavaria as part of the conclusion of the
EU state aid proceedings.
Due to the improvement of the result, tax expenses more than doubled both in the
Group and at BayernLB. The former incurred tax expenses of EUR 252 million compared
with EUR 104 million in the previous year; the latter EUR 175 million compared with
EUR 80 million in the previous year.
After partial profit transfer, which includes interest expenses for capital contributions
of silent partners, and, standing at EUR 242 million in the Group and EUR 220 mil-
lion at BayernLB, is comparable to the previous year’s levels of EUR 237 million and
EUR 219 million respectively, net income for the year is EUR 98 million for the Group
(compared with EUR 79 million in the previous year) and an unchanged EUR 63 million
for BayernLB. This enables a distribution of 4 percent on the nominal capital for 2004.
Segment results
In 2004, the individual segments contributed to the EUR 950 million consolidated oper-
ating profit as follows:
EUR million 31.12.2004 31.12.2003*
Corporates 485 133
Real Estate 62 – 250
Global Markets 76 279
Financial Institutions & Sovereigns 99 116
Savings Banks, Bavarian Municipals /
Corporates 86 – 11
Labo / LBS 109 173
Group’s strategic subsidiaries 421 127
Other – 388 – 20
* Previous year figures adjusted based on the controlling system used in the year under review.
The Corporates segment reported a year-on-year increase of EUR 352 million in its
2004 operating profit. This increase is largely attributable to the net write-back of risk
provisions. The segment reported a very pleasing return on equity of 33 percent, com-
pared to the previous year’s 10.9 percent, thus exceeding our targets. The cost-income
ratio increased year on year from 23.4 percent to 27.2 percent. The marked reduction
in average staff capacities from 377 to 228 positions is largely due to the outsourcing
of employees to the Risk Office Support Operations in conformity with the Minimum
Requirements for the Credit Business of Credit Institutions, as well as the closure of
both foreign and domestic entities.