In the first nine months of 2026, Aareal Bank utilised its operating earnings power to proactively sharpen the risk profile of its loan portfolio. Adjusted operating profit in the reporting period stood at EUR 143 million, compared with EUR 306 million in the first nine months of the previous year. The decline resulted from a deliberate allocation to additional risk provisioning in the amount of EUR 160 million. Without this targeted measure, adjusted operating profit would have stood at EUR 303 million, matching the prior-year level.
Chief Executive Officer Dr Christian Ricken emphasised that the increase in reserves did not represent a deterioration in current portfolio quality. Rather, the institution is actively reducing risks to broaden its strategic options for the coming years. This provides the bank with the flexibility to pursue future opportunities for inorganic growth, a sale, or a potential initial public offering. Furthermore, irrespective of geopolitical uncertainties, the institution expects a return to normalised risk costs from the fourth quarter of 2026.
Operating earnings growth and scheduled risk reduction
Interest income developed stably: net interest income rose to EUR 722 million in the nine-month period, compared with EUR 691 million in the prior-year period. Key drivers were an expanded loan portfolio and a higher deposit volume. Net commission income stood at minus EUR 10 million, down from EUR 4 million in the previous year. Adjusted administrative expenses remained virtually unchanged at EUR 233 million, compared with EUR 229 million in the previous year, resulting in a cost-income ratio of 31 per cent, which is low by industry standards.
The institution made further progress in reducing non-performing loans. The NPL volume decreased to EUR 1.2 billion by the end of the third quarter. The bank remains committed to its plan to bring this volume below EUR 1.0 billion by the end of the year, which would correspond to an NPL ratio of 3.0 per cent. Total risk provisioning after nine months amounted to EUR 365 million. After taxes and servicing AT1 bonds, net income stood at EUR 34 million. Adjusted return on equity was 2.0 per cent, but would have reached 8.0 per cent without the special effects.
Reliable funding and strength in the deposit business
The capital and funding base remained robust as at the reporting date. In the capital markets, the group placed a volume of EUR 2.2 billion in the first nine months, including three Pfandbrief benchmark issuances totalling around EUR 1.7 billion as well as a green senior non-preferred bond of EUR 300 million. One of the benchmark transactions was issued as a green Pfandbrief for the first time.
- —Common Equity Tier 1 ratio (Basel IV CET1 fully-phased) at a solid 15.4 per cent as at the end of September
- —Comfortable liquidity position with an LCR of 185 per cent and an NSFR of 116 per cent
- —Housing industry deposits in the Banking & Digital Solutions segment rose to a record EUR 15.1 billion
- —Adjusted operating profit of the Banking & Digital Solutions segment increased by 20 per cent to EUR 115 million
In the Banking & Digital Solutions segment, housing industry deposits formed a strong foundation for group funding, reaching a peak of EUR 15.1 billion in September. The segment's net interest income improved by 12 per cent to EUR 193 million. In addition, the division is working together with Aareon to advance the integration of the BK01 payment solution into further ERP systems and further expanded its market presence by entering the Dutch market.
