Bankgesellschaft is focussing on core business - Landesbank Berlin

32
MANAGEMENT BUSINESS AREAS SHARE MANAGEMENT REPORT FINANCIAL STATEMENTS
Capital Markets
The Capital Markets business area achieved a good result in the last financial year, with a pre-tax
profit of a 163 million, thus contributing substantially to the Group. The strategic refocusing on the
client business <strong>is</strong> already reflected in the considerable increase in the earnings contributions of
these div<strong>is</strong>ions. The restructuring measures continued as scheduled in Capital Markets in the 2003
financial year. Th<strong>is</strong> was linked to further staff cuts and the optim<strong>is</strong>ation of structures and processes,
in particular in foreign branches.
The rapid reduction of portfolios in the Corporate
Banking and Structured Finance div<strong>is</strong>ions <strong>is</strong> evident
in the decline in the loan volumes. The significant
decrease in deposits results largely from the reallocation
of portfolios previously posted in Capital Markets
to Interest Rate Management at LBB.
Debt Finance div<strong>is</strong>ion restructured
The activities of the Debt Finance div<strong>is</strong>ion were
restructured and moved to other div<strong>is</strong>ions of the business
area as a result of the reorientation of Capital
Markets. Debt Finance will no longer be managed as
a separate div<strong>is</strong>ion.
Successful proprietary trading activities
in Berlin and London
Proprietary Trading successfully put into practice
its cross-product, limited-r<strong>is</strong>k trading strategies and
therefore, as in previous years, achieved a good
result. The activities relating to the interest rate, newly
integrated into Proprietary Trading, contributed to
an even greater extent to th<strong>is</strong> result; Proprietary
Trading at the London location provided a considerable
contribution to the overall success.
Equities d<strong>is</strong>tingu<strong>is</strong>hing itself as a trading
partner and product supplier
The Equities div<strong>is</strong>ion has continued to establ<strong>is</strong>h itself
as a successful provider of trading facilities and
product solutions. The target group for the structured
products was still the retail banking client base
of the Group. In co-operation with the Retail Banking
business area, good sales results were achieved with
in-house products. Furthermore, sales to third-party
institutes, to which Equities offered its structuring
exper-t<strong>is</strong>e, were intensified. In conjunction with
the sales and research services offered, the div<strong>is</strong>ion
maintained the good results of the previous year.
International Business focus
The International Business div<strong>is</strong>ion focussed its
activities on Central and Eastern Europe in line with
the reconstruction plan for the Group. Th<strong>is</strong> meant
a decline in business activities, which could not yet
be offset by intensifying business relations in the
target regions. However, a good overall result was
achieved.