Difficult Situation in the Global Capital Markets Prevents Positive Group Result for 2007
The Managing Board of WestLB AG today informed the Supervisory Board about the current impact of the global capital market crisis on the Bank´s results. As a consequence of the persistently difficult market developments, which have deteriorated further in recent weeks, the Managing Board no longer believes that a positive Group result can be achieved in 2007. The substantial price losses of structured securities in the past weeks were the main reason for this development. As a result, and despite the fact that the earnings trend in the operating business has developed as planned, WestLB will no longer be able to maintain its forecast – until recently still valid - of a positive Group result before taxes for the year as a whole. From today´s perspective WestLB expects to report a pre-tax Group loss in the low three figure million range.
Alexander Stuhlmann, Chairman of the Managing Board of WestLB AG, said: “As for other market players, the situation has not become easier for us in recent weeks. But WestLB can handle it, not least because of the capabilities of its employees.” According to the chairman, the liquidity position of the Bank remains satisfactory. Moreover, the Bank´s core businesses are developing positively in line with expectations and the Managing Board has already implemented a number of measures to reduce costs. These two factors will help to cushion significantly the effects of the developments which have taken place in the markets.
The Supervisory Board took note of the comments by the Managing Board. All shareholders also reaffirmed their unconditional support for the Bank.