Report of the Managing Board
For the management and staff of
the hank, the dominant event of the
past financial year has heen the
sale of the FGH Bank N.V. shares by
AEGON N.V. to Bayerische
Vereinshank AG, already announced
in the previous report. This sale
took effect on 31 March 1998.
On 1 September 1998 the new parent
company merged with the Bayerische
Hypotheken- und Wechselbank AG,
a German counterpart similar in
orientation and size, and was renamed
Bayerische Hypo- und Vereinshank AG
Membership of a financially powerful
and decisive organization with the
express ambition of developing into
the leading European real estate bank
has given FGH Bank N.V. added
impetus. In the past financial year,
the greater scope has led to numerous
activities aimed at improving our
market position and future yields.
The move initiated in 1996 towards
increased prominence and a more
effective market presence continued
last year.
The plentiful opportunities offered by
the market situation together with a
more assertive approach produced
obvious results in commercial terms.
Lending grew by 25% to
NLG 2.5 billion, a level of new
business never before seen in the
history of our bank. Altogether,
new loans were completed totalling
over NLG 2.4 billion, against
NLG 1.8 billion in 1997.
Since redemptions totalled only
NLG 1.2 billion (1997: NLG 1.1
billion), the portfolio was 20% larger
on 31 December 1998 at
NLG 7.5 billion.
This meant that we amply fulfilled
our target for 1998. This year's net
profit comes to NLG 67.8 million, in
line with our earlier prediction.
ENLARGEMENT OF THE BRANCH
NETWORK
In the financial year new regional
offices were opened in the town of
Groningen and in Enschede.
It is pleasing to note that old and
new customers are now visiting both
branches. Both the north and the
east of the country were previously
served from our regional office in
Arnhem. However, market trends
and prospects for the two regions are
such that we are more than justified
in having our own establishment. A
prominent presence in the important
national real estate regions is the
direct outcome of our chosen style of
account management: operating
close to the market with a personal
approach centred on direct contact
with businesses.
With branches in Utrecht,
Amsterdam, Arnhem, Eindhoven,
Enschede, Groningen, The Hague,
Rotterdam and Maastricht, our bank
can serve the principal national real
estate regions from its own offices.
In view of the continuing
competition on the various markets
and the growing importance of
speed, a visible presence and local
knowledge, we shall carry on
strengthening our network of
branches in 1999. The transfer of our
branch in The Hague to a more
appropriate location was recently
effected, and the opening of a branch
in Breda is scheduled for March of
this year. Further enlargement of the
branch network is under
consideration.
MARKFT RFSFARfH
FGH Bank N.V. has been active on
the Dutch real estate market for
more than 108 years. Over the years,
knowledge of the market at location
level has proved vital to a proper
assessment of loan applications.
It is therefore not surprising that we
class the gathering and recording of
market information among our core
activities. We have a database
containing detailed records of many
thousands of transactions. Viewed
in context and supplemented by
information from our valuers, this
provides us with a good insight into
historical and current market trends.
We provide tangible evidence of
this expertise each year in our
Real Estate Report. In 1997 we also
decided to combine our local and
regional knowledge and publish it in
the form of regional market outlines.
In this connection we published a
number of market surveys again last
year: the ceremonial opening of the
Groningen branch was accompanied
by the publication of a survey of
the current market situation in the
three northern provinces, entitled:
Commercieel vastgoed. Het Noorden
zet de deur open! (Commercial real
estate: The North is opening its
doors.)
The launch of the Breda Real Estate
Society initiated by our bank
was the occasion for publishing
Commercieel vastgoed.
Noord-Brabant in de versnelling!
(Commercial real estate. Noord-
Brabant gains momentum), a survey
of the market in the province of
Noord-Brabant where our bank has
been represented for many years
with a branch in Eindhoven. On 9
December we opened our Enschede
branch. Some while before that, the
survey Commercieel vastgoed in
Twente: Dynamiek en ruimte
tussen Regge en Dinkel (Commercial
real estate in Twente: Dynamism
