Varengold Bank AG: Preliminary, unaudited figures 2015

Varengold Bank AG  / Key word(s): Preliminary Results/Miscellaneous

31.03.2016 17:39

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Hamburg, 31st March 2016 - For Varengold Bank AG (WKN 547930), the focus in
fiscal year 2015 was on the restructuring of the bank, concentration on
existing business areas and the associated development of long-term
customer relationships, and the continuing operational optimisation of
internal processes. In particular, the high losses are largely due to the
delayed development of the Prime Brokerage business segment because of the
high administrative expenses and the associated lack of use of customer

The interest income earned by the bank fell from TEUR 1,995 in 2014 to TEUR
1,326 in 2015, while interest expenses rose due to newly acquired customer
deposits, resulting in a negative interest surplus of -TEUR 2,408. The fall
is primarily due to the change in the recognition of the result from
currency conversion and the decline in interest earned from fixed-yield
investment securities as a result of reduced holdings. Commission income
remained stable year-on-year, yielding an amount of TEUR 5,243, while
commission expenses doubled from TEUR 662 to TEUR 1,345. The net income
from the trading portfolio raised from TEUR 8,670 to TEUR 11,117. The
increase result in roughly equal parts from business activities in the
Capital Markets Brokerage and Prime Brokerage segments.
Extraordinary expenses in the amount of TEUR 7,407 were incurred in the
fiscal year, which also include an amount of EUR 4 million paid to three
former members of the bank's Board of Directors for the early termination
of their employment contracts. The general administration expenses of the
company rose by TEUR 8,234 to TEUR 21,012. The increase was significantly
contributed by higher personnel expenses and consulting costs in the Prime
Brokerage. Income from the ordinary business activities of Varengold Bank
AG in the past financial year 2015 totalled -TEUR 5,868 (previous year:
TEUR 530). This temporarily results in a net loss for the year of TEUR
13,267 (previous year: annual net profit of TEUR 209).

The company has reinforced investment in the growth of the bank in the past
in order to build a solid foundation in the long term. The cash inflows
from the most recently implemented capital increases will be used in
particular to further diversify the product portfolios of the two core
business areas of Commercial Banking and Prime Brokerage.
The bank will gradually shift its current focus in the Prime Brokerage
segment from equity strategies to the other asset classes such as real
estate and short-term receivables. In addition, the products in the
Commercial Banking division will be expanded to include forfaiting. Letter
of credit business and the associated issue of bank guarantees will also be
further expanded, as will the Treasury.

In the medium to long term, the aim continues to be to increase the
company's equity through the retention of profits and the integration of
additional investors. After a period of intense upheaval, the company now
feels strategically and operationally well positioned to achieve stable
development of Varengold Bank, which can continue to operate successfully
with less risk in a marked environment characterised by challenges and

Varengold Bank AG will publish its audited financial statements in June

31.03.2016 The DGAP Distribution Services include Regulatory Announcements,
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Language:     English
Company:      Varengold Bank AG
              Große Elbstraße 27
              22767 Hamburg
Phone:        +49 (0)40 / 668649-0
Fax:          +49 (0)40 / 668649-49
ISIN:         DE0005479307
WKN:          547930
Listed:       Regulated Unofficial Market in Berlin, Dusseldorf, Stuttgart;
              Open Market (Entry Standard) in Frankfurt
End of Announcement                             DGAP News-Service