DZ BANK AG: Operating business gets off to a good start in GY 2009

- Cooperative financial services network strengthens capital under its own steam - Plans to place EUR 500 million of tier 1 capital within the cooperative financial services

DZ BANK AG got off to a good start in FY 2009 despite what remains a challenging environment. Important earnings components–especially in the customer business–are developing gratifyingly. “Our business model as a provider of financial services to the cooperative financial services network remains intact despite what is a difficult market environment,” explained Wolfgang Kirsch, CEO of DZ BANK AG.

As already reported, DZ BANK AG continues to expect an additional capital requirement for 2009 of around one billion euros In order to mitigate the considerable uncertainty that still surrounds developments in the financial sector and the real economy. The main reasons for this include the increasingly onerous regulatory capital requirements in a financial market environment that remains difficult. The DZ BANK Group’s tier 1 ratio was 7.4 percent at the end of 2008.

The shareholders on DZ BANK AG’s Supervisory Board had already declared in January that they were basically prepared to undertake such a capital increase. At today’s Supervisory Board meeting, the Managing and Supervisory Boards of DZ BANK AG reiterated the goal of covering existing capital requirements from within the cooperative financial services network as well as to develop the business model in the future.

Against this background, the Managing Board has put a two-stage capital increase before the Supervisory Board. Initially, , DZ BANK AG’s owners are to be asked to furnish EUR 500m of tier 1 capital. The placement is to be carried out in the course of the first half of the year. Once the merger of DZ BANK and WGZ BANK has been completed, the size and basic terms of a capital increase will be determined jointly with the owners on the basis of the aggregated business figures and projections. This should be within the overall framework that was originally pegged out

In addition, the Federal Association of German Cooperative Banks (BVR) has raised the prospect that the cooperative financial services network might make use of its range of instruments temporarily to provide instruments to reduce DZ BANK’s equity capital utilisation, for example by providing a shield for securities portfolios at market conditions. As Wolfgang Kirsch put it: “In this way we gain time to prepare and carry out a capital increase for the merged bank with the due care.”
DZ BANK will continue to pursue flanking measures to free up capital, such as the reduction of securities portfolios and of risk-weighted assets from outside the cooperative financial services network.

“The way that has been proposed allows the cooperative organisation to strengthen our capital position under its own steam. The cooperative financial services network has suitable self-help instruments, for which we are grateful“ said Herr Kirsch.


Martin Roth, Head Communication & Marketing
Tel.: +49-69-7447-42750

Ilja-Kristin Seewald, Head of Department, Press, Internal Communication and Public Affairs
Tel.: +49-69-7447-42894