A4 für Copyshop GB.indd - Bayerische Landesbank

64 BayernLB – our company
Landesbank Saar, Saarbrücken (SaarLB)
Since 1 January 2002, BayernLB has held a stake of 75.1 percent in the partner’s capital
of Landesbank Saar, Saarbrücken (SaarLB), with which it has been in ever-closer part-
nership since 1993.
With total assets of around EUR 17.5 billion and working in close conjunction with
BayernLB, SaarLB conducts universal banking operations in its region with an emphasis
on lending to the commercial sector. Together with the Saarland savings banks, it holds
over 60 percent of all loans by regional institutions to non-banks and was able to
consolidate its market position further during 2004. SaarLB’s regional remit comprises
not only the core Saarland market, but also its neighbouring regions, and in particular
those beyond national borders. In business with France, double-digit growth rates
were again achieved during the past year. In addition to SaarLB’s cooperation with
French partners, the representative office opened in Metz on 1 January 2004 was a
major factor in this growth.
SaarLB’s activities are supplemented by a medium-sized real estate business operating
at both national and international level (underwriting business and direct business)
and by a real estate retail business exploiting the sales opportunities offered by the
Internet.
SaarLB cultivates a close cooperative relationship with the Saarland savings banks. This
cooperation was further affirmed by an agreement signed by the members of the Saar-
land Savings Bank Organisation in the first half of 2004. Ongoing cooperation in the
back office units is now complemented by reinforced joint development of market
potential, particularly in the fields of corporate finance and international commercial
business. Here, the entire Saarland savings bank sector benefits from BayernLB’s prod-
uct range and international connections.
In the context of a still unfavourable economic environment, SaarLB succeeded in
increasing its credit volume further in both corporate and private segments. This is
also reflected in the bank’s increased net interest and commission income. Costs rose
only moderately, and in spite of a significantly lower trading income, it was possible to
hold the cost-income ratio at the lower end of the target range, namely at 50 percent,
while operating profit was again increased. This gave SaarLB the necessary scope to
carry out appropriate risk provisioning and to build up reserves. The bank was thus
able to increase its net income for the year by EUR 1 million to EUR 14 million.
Another key focus, outside of business activities in the strict sense, was the continued
orientation of asset / liability management towards the phasing out of the guarantee
mechanisms in July 2005. One measure with this objective was the expansion of the
investor base – achieved not least by issuing a commercial paper programme. Compre-
hensive provisioning initiatives helped to offset the negative effects of the anticipated
rise in funding costs. Another measure involved significantly improving the core capital
base through retention of earnings and allocation of permanent silent capital contri-
butions. This meant that, at year-end, SaarLB’s core capital ratio exceeded its long-term
target of 7.5 percent.