News and financial reports

Baader Bank remains on growth track with successful 2021 financial year

With earnings before tax of EUR 57.4 million (previous year: EUR 56.0 mn) for 2021, Baader Bank reports another consecutive exceptional year. The corresponding annual financial statements were adopted at yesterday's meeting of the Supervisory Board, following publication of the preliminary figures on 17 February 2022.

The net trading income for the past financial year amounted to EUR 185.0 million (previous year: EUR 168.2 mn), which is above the comparable figure; net commission income declines to a total of EUR 12.9 million (previous year: EUR 31.0 mn). The subsidiaries included in the Group also contributed positively to the overall result for the 2021 financial year. The operating result as at 31 December 2021 was EUR 70.5 million (previous year: EUR 81.5 mn).

Shift in stock exchange market shares and 500,000th securities account opened

Although market volatility was on average below the level of 2020, business performance in 2021 was shaped by factors such as very high trading volumes, in particular on the stock exchanges and trading platforms on which Baader Bank is active. As a result, fee-optimised market places, which sometimes implement free pricing strategies, have been gaining market share from the traditional German regional exchanges.

The growth is also reflected in the securities account and account business, which continues to show pleasing development. At the end of the past financial year, Baader Bank opened the 500,000th securities account (previous year: 129,141 securities accounts), meaning the number of securities accounts has almost quadrupled compared to the previous year. Growth in this business segment accelerated significantly in the fourth quarter in particular. There is likely to be greater focus in the future on expanding B2B2C collaborations with neo-brokers and online asset managers; this area offers strong potential over the long term and Baader Bank hopes to realise that potential through solutions such as a dedicated high-performance IT infrastructure.

Like the brokerage, research, capital market and asset management services, the securities account and account business makes a positive contribution to commission income through cross-selling effects. Overall, Baader Bank has consolidated its market position in all business divisions and boosted Group commission income by 19 % on the previous year to EUR 112.0 million (previous year: EUR 94.5 mn).

At EUR 11.0 million, Baader Bank Group revenue was slightly down on the previous year (EUR 12.0 mn) at -8 %; the revenue is generated by the electricity yields from the Bank's own wind farm. Net interest income and current income for 2021 amounted to EUR -1.6 million (previous year: EUR -2.6 mn). Other income increased to EUR 8.1 million compared to the previous year (previous year: EUR 4.1 mn). Total revenue was EUR 215.5 million (previous year: EUR 212.7 mn).
Expenses remain almost constant

Total expenses for the 2021 financial year amounted to EUR 158 million (previous year: EUR 156.6 mn), which is almost at the same level as the previous year. Higher administrative and personnel expenses are largely offset by lower depreciation and risk provisions. Personnel expenses were up 3 % on the previous year, to EUR 73.5 million (previous year: EUR 71.2 mn) and other administrative and other operating expenses increased by 16 % to EUR 55.9 million (previous year: EUR 48.1 mn).

At EUR 10.1 million, depreciation within the Baader Bank Group in the 2021 financial year was down significantly (previous year: EUR 20.4 mn). Of this amount, EUR 9.1 million related to depreciation and value adjustments on intangible assets and property, plant and equipment, EUR 1.0 million related to amortisation, and value adjustments on receivables and certain securities treated as assets.

For 2021, total expenses again included the allocation to the fund for general banking risks, which was to be provided with EUR 18.5 million¹ in accordance with Section 340e (4) of the German Commercial Code (HGB).

Total assets doubled and significant increase in balance sheet equity capital

Total assets doubled on the previous year, rising to EUR 1,819.7 million (previous year: EUR 888.6 mn). Balance sheet equity was up EUR 43.5 million to EUR 164.5 million (previous year: EUR 121.0 mn), with the balance sheet equity ratio falling to 9 % (previous year: 14 %).

As at 31/12/2021, the number of employees in the Baader Bank Group had increased from 388 to 448 compared to 31/12/2020 (based on full-time equivalent).

2022 outlook

For the 2022 financial year, Baader Bank's basic scenario assumes that market volatility will normalise again compared to the highly volatile previous years 2020 and 2021, especially in the second half of the year. At the same time, the number of securities transactions and the volume of sales are expected to continue developing at the same level as in the previous year due to the continuing growth of customers, market volumes and products. Both the expected increase in volume in all business segments and a significantly increasing number of private investors in the retail client business will support future development.

Assuming the appropriate conditions, the Board of Directors of Baader Bank expects the Group's earnings before tax for the 2022 financial year to be around EUR 30 million, with a cost-income ratio of around 80 % and a return on equity after tax of around 15 %.

Given the unpredictable, exogenous influencing factors, the Board of Directors is of the opinion that reliable forecasts for the business development can only be made to a limited extent. For this reason, the statements, expectations and forecasts on the future development of Baader Bank are based on the information and knowledge available to the company at the time of publication.
The Board of Directors of Baader Bank still intends to pay a dividend for the 2021 financial year, subject to the approval of the shareholders' meeting; the dividend amount will be EUR 0.35 per share entitled to dividend. The shareholders' meeting is expected to take place on 7 July 2022 in a virtual format. Baader Bank's annual report for 2021 will be made available in the "Financial reports archive" section of the Company's website at the end of May 2022 when the annual shareholders' meeting is convened.

Overview of key figures 2021 ²

¹ The transfer to the fund for general banking risks also takes into account the statutory transfer to the fund for general banking risks in accordance with Section 340e HGB at the end of the year.
² Financial figures of the Baader Bank Group reported in accordance with the provisions of the German Commercial Code (Handelsgesetzbuch - HGB).
³ Gross profit (= net interest income + current income + net commission income and trading income + revenues) less personnel expenses and other administrative expenses as well as amortisation/depreciation on intangible assets and property, plant and equipment.
For further information and media enquiries:

Florian E. Schopf
Managing Director
Company Spokesperson
Head of Group Strategy & Communication

T +49 89 5150 1013
M +49 160 7188826

florian.schopf@baaderbank.de
https://www.baaderbank.de

Baader Bank AG
Weihenstephaner Strasse 4
85716 Unterschleissheim, Germany