ProCredit group reports resilient financial result as strong operational performance for 9M 2022 balances continued provisions for Ukrainian operations

• Group result of EUR 17.3 million in 9M 2022, with the third quarter contributing EUR 9.6 million; RoE at 2.7%
• 9M 2022 result includes provisions of EUR 79.1 million or 173 bps cost of risk, largely for Ukrainian loan portfolio; credit-impaired loans at 3.1%
• Result excluding Ukrainian operations up by EUR 15.8 million or 35%, annualised RoE at good level of 9.0%
• Cost-income ratio improves by 1.7 percentage points to 60.7% as operating income increases markedly by 21%
• Portfolio grows by 6.2% with share in green loans increased to 19.7%
• Comfortable CET1 ratio (fully loaded) of 13.6% and leverage ratio of 9.3%

The ProCredit group, which is mainly active in South Eastern and Eastern Europe, recorded a result of EUR 17.3 million in the first nine months of 2022. This corresponds to an annualised RoE of 2.7%. Operating income increased by 21% y-o-y, contributing to the good reduction in the cost-income ratio by 1.7 percentage points to a level of 60.7%. The result continues to be marked by high levels of provisions of EUR 79.1 million, of which EUR 73.1 million were built for the group’s Ukrainian portfolio. Overall, the group’s 9M 2022 results show good progress with regard to the guidance metrics for the financial year 2022.

The loan portfolio increased by EUR 368 million or 6.2% (9M 2021: +EUR 549 million or 10.4%). Green loans grew by 10.0% since beginning of the year, with a particularly positive dynamic in the renewable energy portfolio, and now stand at a share of 19.7% of the total loan portfolio. Deposits increased by EUR 442 million or 8.0% (9M 2021: +EUR 373 million or 7.6%).

Growth in operating income ahead of costs, leading to improved cost-income ratio

The group’s operating income increased by a strong EUR 42.1 million or 20.6% to a level of EUR 246.6 million (9M 2021: EUR 204.5 million) on the back of higher net interest income, net fee income and other operating income. Apart from ProCredit Bank Ukraine, all ProCredit banks recorded positive results in the first nine months of 2022, most showing good improvements in profitability and cost efficiency with respect to last year.

Net interest income increased by EUR 30.7 million or 19.0% to EUR 192.1 million (9M 2021: EUR 161.4 million). The net interest margin increased by 20 basis points compared to the previous year to a level of 3.0% on the back of stable lending margins and increased base rates. In Q3, the net interest margin stood at a good level of 3.2%.

At EUR 40.2 million, net fee and commission income was 8.6% above the previous year’s level (9M 2021: EUR 37.1 million). Income from the transaction and card business showed particularly positive trends. Net other operating income contributed EUR 14.3 million (9M 2021: EUR 6.1 million).

Personnel and administrative expenses increased by EUR 22.1 million; however, operating income rose by EUR 42.1 million, or almost twice that amount. As a consequence, the cost-income ratio improved by 1.7 percentage points to 60.7% (9M 2021: 62.4%). The increase in personnel and administrative expenses relates mainly to higher costs for personnel, IT, marketing and travelling, as well as extraordinary expenses mostly associated with the war in Ukraine.

On the one hand, extraordinary expense items amounted to EUR 7.9 million mainly including extraordinary legal, advisory and audit fees, as well as one-off salary payments to staff and a full write-down of goodwill in Ukraine. On the other hand, the change in the interest rate environment led to a positive effect from the revaluation of derivatives amounting to EUR 5.0 million included in net other operating income.

Group without ProCredit Bank Ukraine showing strongly improved performance; provisioning for Ukrainian operations continued

The group without ProCredit Bank Ukraine achieved a marked increase in net profit of EUR 15.8 million with respect to the first nine months of 2021 to a level of EUR 60.6 million (9M 2021: EUR 44.5 million), which corresponds to an annualised RoE of 9.0%. These continued improvements were mainly driven by a steadily strengthening market position, continued good loan growth and positive margin development. For the group excluding Ukraine, the share of credit-impaired loans reduced by 0.2 percentage points, allowing for a low cost of risk of 15 basis points. At group level, the share of credit-impaired loans amounted to 3.1%. The group’s largest segment, South Eastern Europe, contributes 70% to the group’s loan portfolio and at 11.4% ended the first nine months of 2022 with a markedly improved, double-digit return on equity (9M 2021: 8.6%).

At group level, mainly due to the war in Ukraine, expenses for loss allowances increased to EUR 79.1 million (9M 2021: EUR 3.2 million). This corresponds to an annualised cost of risk of 173 basis points (9M 2021: 8 basis points). As of 30 September 2022, the loan portfolio of ProCredit Bank Ukraine accounts for 10.9% of the group’s total portfolio. Approximately 8% of Ukrainian loans, or EUR 52 million, are to clients located in areas currently under Russian occupation.

The operations of ProCredit Bank Ukraine continue largely uninterrupted thanks to the already implemented digitalisation and process centralisation. The bank’s capital and financial position continues to remain sound. Whilst current damage to collateral or other operating assets of ProCredit clients is relatively limited, the ongoing war and in particular the destruction of energy and other infrastructure in the country continues to present an ongoing challenging situation for the people and businesses on the ground.

Good progress regarding guidance for the financial year 2022

Based on the solid financial results of the nine-month period, management considers the group to be well on track to achieve updated guidance metrics for the full year 2022, although uncertainty remains high, particularly about the situation in Ukraine and the future development of the war. Based on the strong efficiency improvements in 9M 2022, the cost-income ratio should improve to a level of 60-63% (2021: 64.2%). The return on equity is expected to be substantially below the level of the previous year (2021: 9.7%). The loan portfolio growth rate is anticipated to be in the medium single-digit percent range, after adjusting for currency effects. With a CET1 ratio (fully loaded) of 13.6% and a leverage ratio of 9.3% as of 30 September 2022, the year-end CET1 ratio is expected to be at a solid level of above 13.0%, and the leverage ratio at approximately 9.0%.

The ProCredit group’s quarterly financial report for Q3 2022 is available as of today on the ProCredit Holding website under Investor Relations at

Andrea Kaufmann, Group Communications, ProCredit Holding, Tel.: +49 69 951 437 138,

About ProCredit Holding AG & Co. KGaA
ProCredit Holding AG & Co. KGaA, based in Frankfurt am Main, Germany, is the parent company of the development-oriented ProCredit group, which consists of commercial banks for small and medium enterprises (SMEs). In addition to its operational focus on South Eastern and Eastern Europe, the ProCredit group is also active in South America and Germany. The company’s shares are traded on the Prime Standard segment of the Frankfurt Stock Exchange. The anchor shareholders of ProCredit Holding AG & Co. KGaA include the strategic investors Zeitinger Invest and ProCredit Staff Invest (the investment vehicle for ProCredit staff), the Dutch DOEN Participaties BV, KfW Development Bank and IFC (part of the World Bank Group). As the group’s superordinated company according to the German Banking Act, ProCredit Holding AG & Co. KGaA is supervised on a consolidated level by the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin) and the German Bundesbank. For additional information, visit:

Forward-looking statements
This press release contains statements relating to our future business development and financial performance, as well as statements relating to future actions or developments affecting ProCredit Holding which may constitute forward-looking statements. Such statements are based on the management of ProCredit Holding’s current expectations and specific assumptions, many of which are beyond the control of ProCredit Holding. They are therefore subject to a multitude of risks, uncertainties and factors. Should one or more of these risks or uncertainties materialise, or should underlying expectations or assumptions prove incorrect, then the actual results, performance and achievements (both negative and positive) of ProCredit Holding may differ significantly from those expressed or implied in the forward-looking statement. Beyond the legal requirements, ProCredit Holding does not undertake any obligation to update these forward-looking statements or to correct them in the event of deviations from the expected development.