230967 com titel gb 02 e

The situation was different at most European outlets. This was very evident
in Poland, for example, where BRE Bank, in which we have a 50% interest,
posted a loss after years of high profits. Sizeable provisioning, write-downs on
securities portfolios and weaker earnings led to a negative result of 795m. We
are confident, though, that the restructuring measures which have been introduced
will ensure a return to the black in the current year.
In Western and Southern Europe, we are systematically expanding our corporate
business. The goal here is to make more efficient use of our existing
European network, above all for cash-management and payment services. At the
same time, we are continuing to concentrate on large corporates and multinationals.
Securities department
Following the integration of part of the Bank’s associated corporate-finance
activities into the Securities department in the previous year, foreign exchange
was also transferred from Treasury to the unit in mid-2002. Securities can now
offer clients the full range of products and services in the area of equities, bonds
and foreign currencies and derivatives, as well as M&A advice, from a single
integrated platform.
The result achieved by this business line, especially in equities, was disappointing.
Not even the shift of emphasis to profitable lines, such as fixed
income, and sizeable cost cuts were sufficient to offset the poor performance of
the international stock markets.
More than half of the agreed reduction by at least 425 in the number of frontoffice
staff in investment banking – combined with recruitment of up to 75 new
staff in profitable areas – has now been realized. The cuts have mainly affected
the overseas locations of New York, Tokyo and Singapore, where some product
lines were discontinued entirely and others were scaled back to the minimum
level needed to maintain business relationships with corporate customers. Once
this restructuring is complete, our workforce in investment banking will be
almost 30% smaller. The promising start to 2003 shows that we have successfully
repositioned our operations.
CORPORATE AND INVESTMENT BANKING 37
Securities department
2002
Equity tied-up (7m) 1,302
Operative
return on equity –22.7%
Cost/income ratio
in operating
business 136.1%