FRANKFURT, March 7 (Reuters) – Deutsche Pfandbriefbank (PBBG.DE), opens new tab (PBB), one of Germany’s top property financiers, on Thursday posted its lowest annual profit and biggest loss for soured loans since going public, underscoring the severity of a widespread real-estate slump.
PBB has become a visible sign of weakness in the financial industry stemming from the property crisis in Germany and a downturn in the United States, and is navigating what it has termed “the greatest real estate crisis since the financial crisis”.
The bank’s 2023 profit crumbled to 91 million euros, compared with 187 million euros a year earlier, while provisions for loan losses shot up to 212 million euros from 44 million euros, figures showed.
“We are well aware of the need to win back trust,” the bank said on Thurday. PBB was borne out of a German government bailout during the financial crisis more than a decade ago and went public in an initial public offering in 2015. It then went on a lending spree in the U.S., which is now suffering from high office vacancies and falling property prices.This year the bank’s shares have fallen as much as 40% as short sellers bet against the bank, with one with one saying the bank risked being sucked into a “downward spiral”. Its bonds have also come under pressure after PBB’s rating was downgraded in February to a notch above “junk”.
