Deutsche Pfandbriefbank: Why the share value has fallen to a document low | EUROtoday

The shares of actual property financier Deutsche Pfandbriefbank (PBB) are slowly recovering after falling to a document low on Friday. The share value had beforehand fallen by nearly ten proportion factors because the starting of the yr. The actual property financier’s securities have since collapsed to three,594 euros. The cause for the document loss is the postponement of the revenue targets for 2027. PBB additionally introduced that there could be no dividend for final yr. Within a yr, Deutsche Pfandbriefbank shares have misplaced nearly 37 p.c of their worth. With a lack of nearly eleven p.c, the shares had been lately the clear backside within the S-Dax. The small cap index rose barely.

Even after its costly withdrawal from the USA, Deutsche Pfandbriefbank can not escape the disaster. Last yr it slipped even deeper into the purple than analysts anticipated, and the extent of pre-tax revenue forecast for 2026 was additionally disappointing. Because the actual property market will not be recovering sufficient, CEO Kay Wolf postponed his earlier medium-term targets for working revenue and return on tangible fairness from 2027 to 2028 or later.

The profitability goal that has been postponed into the longer term reveals that the “braking distance” of the US exit is longer than beforehand thought, wrote analyst Andreas Pläsier from Warburg Research. In addition, the continuing prices of danger provisioning within the USA and the sluggish market restoration are weighing extra closely than anticipated. As a consequence, gradual income development within the European business actual property financing enterprise will probably be slower to offset the loss within the US enterprise.

Of eight analyst companies, two advise shopping for and three every suggest holding and promoting. Jochen Schmitt from Bankhaus Metzler lowered the goal for the share from 3.80 euros to three.20 euros. Steven Gould from the German-French monetary group Oddo BHF additionally lowered the worth goal from 4.40 euros to three.70 euros.

Last yr, the business actual property financier posted a lack of 250 million euros earlier than taxes resulting from its exit from the desolate US enterprise, because it surprisingly introduced in Garching based mostly on preliminary figures.

CEO Wolf is now predicting a pre-tax revenue of 30 to 40 million euros for 2026. Industry specialists had anticipated a median of round 100 million extra.

In addition, the minus in 2025 was even increased than analysts anticipated on common. Even in 2023 and 2024, the Pfandbrief financial institution nonetheless earned round 100 million earlier than taxes, regardless that the disaster was already obvious within the figures again then. CEO Wolf took over the administration of the institute from long-time financial institution boss Andreas Arndt at first of 2024. In the identical yr, he deserted his predecessor’s medium-term plans and set himself rather more modest objectives. Now he is slicing again on that once more.

“The transformation of the bank will require more time than we originally expected due to the US exit and the sluggish market recovery,” he mentioned on Friday, in accordance with the assertion. Without stronger tailwinds from the market, the financial institution is unlikely to realize its key strategic monetary objectives earlier than 2028.

Wolf had beforehand set himself the aim of accelerating the institute’s working revenue to 600 million euros by 2027. At the identical time, the financial institution ought to obtain a return on tangible fairness of eight p.c.

PBB solely ventured into the US market in 2017 and pulled the ripcord in June final yr due to the actual property disaster there. “The bank has largely shielded the risks in the USA and from project financing and has already significantly reduced them in parts,” it mentioned with a view to 2026.

Last yr, the financial institution’s working revenue fell by greater than a fifth to 422 million euros because of the withdrawal from the USA. According to administration, they’re more likely to be decrease relatively than increased this yr at 375 to 425 million euros. After all: new enterprise elevated by nearly 1 / 4 to round 6.3 billion euros in 2025. For 2026, Wolf is planning a rise to 7.5 to eight.5 billion. The Pfandbrief financial institution plans to publish additional particulars about 2025 as deliberate on March fifth and current the total annual report on March twenty eighth.