Publication of the Annual Report 2020

Deutsche Hypo has published its Annual Report 2020 today. You can find the document in the download area. Here, you can already read the interview of the Board of Managing Directors. In this interview, Andreas Rehfus and Christian Veit report on the challenges of financial year 2020.


Within a very short time, 2020 has overturned many things we take for granted. How did you and Deutsche Hypo deal with the coronavirus pandemic?

Rehfus: When it became clear in mid-March 2020 that there would be restrictions, we had to react very quickly to maintain our business operations. A specially established situation team assessed the impact of Covid-19 on Deutsche Hypo at times on a daily basis. We have responded to the risk of infection and the massive restrictions imposed by the authorities with the implementation of a wide range of measures to protect our employees and business partners. Within a very short period of time, we managed to set up a rolling home office concept for all our employees and to continue our business operations without any restrictions. Our customers could fully rely on us during this time.

Veit: My appointment as a Member of the Board of Managing Directors of Deutsche Hypo on 1 September 2020 coincided exactly with the corona pandemic, of course. It was sometimes difficult to introduce myself personally to the staff. For this reason, we showed an introduction video and henceforth strengthened the use of virtual communication media. As Member of the Board of Managing Directors for the back-office functions, I was of course highly challenged with the risk situation in the pandemic environment. Various teams of experts analysed both the effects on Deutsche Hypo’s business operations and the loan portfolios in all sub-asset classes. In addition to monitoring the property types particularly affected by the coronavirus pandemic, a few financings had to be permanently monitored. Based on Deutsche Hypo’s conservative risk policy, I was not surprised that only a few Covid-19-related deferral requests were made by our clients.

How did Deutsche Hypo’s business develop in 2020?

Rehfus: After two very successful months in January and February 2020, the Bank’s new business volume declined significantly as compared to the previous year from March onwards in the wake of the lower demand for loans due to the Covid-19 crisis and cautious and restrained lending. The slight easing of the pandemic situation, at least for a short time, resulted in an increase in demand for loans and a significant rise in new business in the second half of the year. Overall, we achieved a new business volume of € 2.3 billion (2019: € 3.0 billion). Another positive aspect is that we completed our cost-cutting programme last year. In this way, we achieved efficiency increases in the Bank’s internal processes and improved the Bank’s technical infrastructure by digitalising internal workflows.

Veit: In view of the challenges faced in 2020 as already mentioned, Deutsche Hypo can look back on a thoroughly satisfactory 2020 financial year. The result from normal operations reached € 43.5 million (2019: € 55.1 million). The decline in earnings is due to additions to general loan loss provisions. We established these in order to take care of the uncertainties associated with the effects of the coronavirus pandemic. Despite all this, the share of non-performing loans has so far remained at a historically low level. This underlines our focus on good quality in the real estate financing portfolio, which we have consistently pursued in recent years.


In December 2020, it was decided to integrate Deutsche Hypo into NORD/LB. What does this change mean for the Bank?

Rehfus: As a long-time employee and Member of the Deutsche Hypo Board of Managing Directors, the integration of Deutsche Hypo of course also makes me a little nostalgic. An outstanding bank has been formed in the almost 150-year history of Deutsche Hypo. Deutsche Hypo is backed by great and dedicated employees who enjoy a high reputation in the real estate finance sector. It is great that the Deutsche Hypo brand will not be lost. It is now up to us to transfer these achievements to NORD/LB. We will certainly succeed in this. Preparations for the transition on 1 July 2021 are already in full swing.

Veit: It is very important to emphasise that Deutsche Hypo is a profitable pillar and will remain the centre of competence for commercial real estate finance in the NORD/LB Group. Our established green products – Green Bond and Green Loan – will also be continued and further developed. We attach great importance to sustainable properties, so we have set ourselves the goal of increasing the share of financing for green buildings to one third of our portfolio by 2025 and thus improving the quality of the real estate financing portfolio. Our customers will not only retain their points of contact, but they will also receive comprehensive financial services from NORD/LB from a single source over and above the pure real estate financing business.