Deutsche Pfandbriefbank AG (pbb), the European specialist bank for commercial real estate finance, announced a pre-tax profit of €28 million for Q1 2025, down compared to the €34 million in Q1 2024, but an higher from Q4 2024.
The bank's risk provisions have seen a significant reduction, falling to -€26 million, which is approximately 45% lower than the -€47 million reported in the same period last year. While Q1 2024 benefited from substantial net income from realisations and a larger REF portfolio, the focus for Q1 2025 has been on the operating result of the core business, with interest and commission income reaching €109 million.
pbb's new business volume increased to €1.1 billion, up from €0.7 billion in Q1 2024. The gross interest margin in new business also saw a slight rise to around 250 basis points.
“This was a solid quarter for pbb. We were able to consolidate income in our core business and significantly reduce risk costs. Our overarching goal remains increasing our profitability and return on tangible equity, and reducing costs by the end of 2027, despite all the uncertainties on the markets”, said Kay Wolf, CEO of pbb.
The bank is making progress with its Strategy 2027, which includes the division of sales into Real Estate Finance Solutions and Real Estate Investment Solutions. However, pbb has decided to halt new business on the US property markets due to increased volatility, and is reviewing options for its existing US business.
