The past financial year was a historic year for Hypo Vorarlberg: the state-owned financial institution managed to increase its total pre-tax result to more than 160 million euros.
The bottom line was a record result of 160.7 million euros, after tax there is another plus of 120.1 million – the profit is therefore almost 80 percent higher than last year. “We’ve had a very good, solid operational year,” said CEO Michel Haller, who was quite level-headed given the strong numbers. His reluctance may also be due to the fact that positive valuation effects impacted the result before tax by approximately 70 million euros. “If you exclude the valuation effects, we are still around 90 million euros in profit,” Haller emphasises.
Positive impulse for the construction sector
The client business has developed extremely well and the need for provisions for risks is also declining. According to Haller, the business development also confirms the bank’s strategy, which is to be a bank for businesses and a strong partner in housing financing. Speaking of housing: Ländle-Hypo has also observed a rapid market change in this area since the summer, the loan volume has collapsed by about 50 percent. In addition to rising interest rates, according to Haller, the stricter award criteria as a result of the new KIM regulations are also responsible.
He is therefore in favor of exempting renovations from the scheme – this would also give a positive boost to the construction sector, which is already feeling the effects of the drop in orders. Asked about further economic development, Haller said hesitantly: “There are no major problems yet, but there is a crisis.” Despite the risk of a recession, he expects the ECB to raise interest rates twice more – “after that, however, the sideways movement should stop, and from 2024 rates could even fall again.”
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
