“We have bottomed out,” said the bank boss on Wednesday at the annual press conference. Demand for housing loans increased by a fifth in the first quarter of 2024 alone. As the year progresses, the government’s planned construction package should also provide further impetus.
“We notice that young adults have gotten used to the higher interest rates,” said Gasselsberger about the development of demand for home loans. The rising wage level after the high KV agreements, the falling real estate prices, the expectation of falling key interest rates and the easing of the bureaucratic hurdles in the exception quotas for housing loans should brighten the mood further, according to the bank boss.
He also sees positive impulses in the construction package recently approved by the government; overall, it should help to stimulate residential construction again. Above all, the speed of implementing the announced measures was “surprisingly positive”. Gasselsberger is not worried that the cheap state loans included in the construction package could compete with the banks.
Overall, however, he assesses the work of the incumbent government more critically. “We haven’t seen much in the way of reforms in the last few years,” said the bank boss. He doesn’t expect much new from the coming months; rather, the parties will conduct a primary election campaign that should flow seamlessly into the election campaign.
“Very successful year”
However, the Gasselsberger was very satisfied with the development of the banking business last year. 2023 was “a very successful year for Oberbank”. The lending business grew by 4.6 percent to 20.1 billion euros. There was a clear increase of 7.2 percent, especially in loans for business customers (commercial loans). The leasing business was also strong with growth of 18.2 percent in new business. Things went particularly well in Germany, which is also due to the fact that several leasing providers there have withdrawn from the market.
The interest result rose by 47 percent to 596.8 million euros and the at-equity result, which is primarily determined by the voestalpine investment, also rose by 38.3 percent to 125.4 million euros. The commission result, however, fell by 5.2 percent to 196.1 million euros. The bottom line was that there was a profit after taxes of EUR 382.6 million, an increase of 57.3 percent.
However, the credit risk has also increased, with risk provisions increasing by 17.3 percent to EUR 443.1 million. This was mainly due to developments on the real estate market. However, Gasselsberger spoke of a normalization after an extremely low level in previous years.
Optimistic outlook
This year, Oberbank expects that the economic downturn will also be felt in the credit risk in corporate customer business. However, a slight economic recovery could be in sight for the second half of the year, which should again have a positive impact on the risk. The optimism is based on customer conversations as well as the expectation of lower inflation and interest rates as well as the expectation of real wage increases.
In general, an outlook for this year is difficult due to the different economic developments in the USA and Europe. While things are now doing better in the USA and around the world, Europe is still weak.
Gasselsberger also commented on the legal dispute with UniCredit that has been going on for several years. From a legal perspective, the past year was very successful. “UniCredit has lost everything so far,” said the bank boss. In the summer of 2023, the Supreme Court ruled that the corporate structure of the 3-bank group and all previous capital increases were legal.
However, there are still many other construction sites open in the dispute. UniCredit Bank Austria is appealing against a first instance decision by the Takeover Commission after it failed before the Commission to bring the 3 banks (Oberbank, BTV, BKS) under its control. UniCredit Bank Austria is also demanding that Oberbank assert claims for damages against its own board of directors. According to Gasselsberger it is a sum of 3 million euros.
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Source: Nachrichten
