GARCHING (dpa-AFX) - Deutsche Pfandbriefbank wants to divest itself of riskier loans after its months-long crisis. The sale of a 900 million euro package of loans for offices, residential buildings and hotels in the USA and Great Britain is close to completion, said the new CEO Kay Wolf at the presentation of the quarterly figures on Tuesday. In the first quarter, the bank set aside another chunk of money for impending loan defaults. Despite this, it was clearly in the black again, having even slipped into the red at the end of 2023 due to the crisis surrounding commercial real estate in the US.

According to insiders, the buyer of the loan package is the US financial investor Blackstone. The deal is expected to be concluded as early as Wednesday, reported the news agency Bloomberg, citing people familiar with the matter. Bank CEO Wolf did not want to comment on the name of the buyer in a video conference.

In his view, however, such deals should not remain an exception. "We want to become much more dynamic and flexible," he said. He wants to manage the bank's loan portfolio more closely with a view to return and risk.

Initially, the sale is intended to reduce the bank's risks in the USA and the UK. Wolf explained that EUR 500 million of the EUR 900 million volume was attributable to the United States. Many office spaces are vacant there, for example if they are less attractive to tenants due to their location or facilities. Some owners can no longer pay their loan installments and the value of such properties has fallen sharply. As a result, the Pfandbriefbank lost the collateral for some loans.

The corresponding provisions led to the bank's pre-tax profit plummeting by more than half to 90 million euros last year. In the current year, profits should be higher again, Wolf assured. However, he did not want to give a figure when asked. The bank will also make increased risk provisions for loan defaults in 2024. This applies above all to the first half of the year.

Despite the sale of loan portfolios, the bank's business is not expected to shrink. Wolf is still planning a loan portfolio of 30 to 31 billion euros. In the first quarter, the bank only wrote new business amounting to 700 million euros, around 300 million less than a year earlier. As announced, the figure for the year as a whole is expected to reach 6 to 7 billion euros.

In the first quarter, the Pfandbriefbank earned 34 million euros before taxes, two million more than a year earlier, as announced in Garching near Munich. The surplus rose from 27 to 29 million euros. However, the bank once again set aside a lot of money for impaired loans: risk provisions rose from 2 to 47 million euros year-on-year. An increase in net interest income more than compensated for this.

The news was greeted with relief on the stock market: The Pfandbriefbank share, which had been battered for a long time, gained more than seven percent to 5.60 euros by early afternoon, making it one of the strongest stocks in the small-cap index SDax. However, around two years ago in April 2022, the stock was still trading at more than twice the price. It then went downhill - especially since the effects of the US real estate crisis became apparent in 2023. Since the beginning of March, the share price has recovered a good deal./stw/niw/jha/