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All the divisions of HVB contributed to the Group's strong year-on-year (yoy) increase of operating profitability in 2006. These results are particularly positive, given the fact that during the year, a major divisionalisation process was successfully implemented and many projects were launched in all divisions to enhance their future profitability.

Group operating profit rose by 70% yoy, driven by:

  • Retail division: over 100% increase1, as rising revenues augmented the effect of an important decrease in operating costs (–8.7% yoy).
  • Wealth Management division (WEM): increase1 of 17.6% yoy despite Activest disposals, with Private Banking posting a solid 45% yoy rise thanks to double digit top line growth, combined with a significant decrease in costs.
  • Corporates & Commercial Real Estate Financing division (CCREF): increase1 of 9.8% yoy with a distinct rise in Corporates, stemming from both higher revenues and lower costs, and the ongoing restructuring of CREF carried on with no significant drag on operating profit.
  • Markets & Investment Banking division (MIB): increase1 of 43.3% yoy as the higher level of activity of all major business segments led to over 20% increase in operating revenues.

During 2006 the new Global Banking Services division successfully consolidated service units, already achieving a sustained cost reduction for the Group.

1 increase in Group operating profit



Divisional highlights1
€ millions Retail Wealth
Management		 Corporates &
Commercial
Real Estate
Financing		 Markets &
Investment
Banking
Total revenues
2006 1,728 550 1,1033 1994 2,279
2005 1,694 569 1,0433 2334 1,889
         
Operating costs
2006 (1,422) (336) (444)3 (51)4 (1,163)
2005 (1,557) (387) (459)3 (82)4 (1,110)
         
Operating profit
2006 306 214 6593 1484 1,116
2005 137 182 5843 1514 779
         
Profit before taxes
2006 117 746 4473 844 969
2005 (174) 133 3603 (76)4 700
         
Cost-income ratio2 in %
2006 82.3 61.1 40.33 25.64 51.0
2005 91.9 68.0 44.03 35.24 58.8

1 please refer to the Notes for more detailed information
2 based on total revenues
3 Corporates
4 Commercial Real Estate Financing

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