Half-Yearly Financial Report 2021 2021 FinancialReport Half-Yearly Values with impact. Values Half-Yearly Financial Report 2021 4 The Helaba Group The Helaba Group Helaba ratings (As at: August 2021) Moody’s Fitch Standard & Poor’s Outlook Stable Outlook Stable Outlook Stable Long-term Long-term Issuer Long-term Issuer Issuer Rating Aa3 Default Rating 1) A+ Credit Rating 1) A– Counterparty Risk Assessment3) Aa3(cr) Public Sector Pfandbriefe AAA Short-term Issuer Credit Rating 1), 2) A-2 Long-term Long-term Deposit Rating3) Aa3 Mortgage Pfandbriefe AAA Senior Unsecured 1), 3) A– Public-Sector Short-term Issuer Default Long-term Covered Bonds Aaa Rating 1), 2) F1+ Senior Subordinated 1), 4) BBB+ Short-term Deposit Rating 2) P-1 Derivative Counterparty Rating 1) AA–(dcr) Standalone Credit Profile 1) a– Long-term Senior Unsecured3) Aa3 Long-term Deposit Rating 1) AA– Long-term Junior Senior Unsecured 4) A2 Senior Preferred 1), 3) AA– Subordinate Rating 5) Baa2 Senior Unsecured 1), 4) A+ Baseline Credit Assessment baa2 Subordinated debt 1), 5) A– Viability Rating 1) a+ Ratings for Helaba liabilities that are covered by statutory guarantee (grandfathering)6) Moody’s Fitch Ratings Standard & Poor’s Long-term ratings Aaa AAA AA– 1) Joint S -Group rating for the Sparkassen-Finanzgruppe Hessen -Thüringen, 4) Corresponds in principle to long -term senior unsecured debt according to respectively based on the group rating. § 46f (6) KWG (“without preferential right to payment”). 2) Corresponds to short-term liabilities. 5) Corresponds to subordinated liabilities. 3) Corresponds in principle to long -term senior unsecured debt according to 6) The statutory guarantee applies to all liabilities in place prior to 18 July 2001 § 46f (5 and 7) KWG (“with preferential right to payment”). (no time limit). Stakes in Helaba’s share capital 1) represented by DSGV e. V. as the trustee. 68.85 % 4.75 % Sparkassen- und Girover- Rheinischer Sparkassen- band Hessen-Thüringen und Giroverband 8.10 % 4.75 % State of Hesse FIDES Alpha GmbH1) 4.05 % 4.75 % State of Thuringia FIDES Beta GmbH1) 4.75 % Sparkassenverband Westfalen-Lippe 5 The Helaba Group in figures 1.1. – 30.6.2021 1.1. – 30.6.2020 Change Performance figures in € m in € m in € m in % Net interest income before loss allowances 643 598 45 7.4 Net fee and commission income 223 211 13 6.0 General and administrative expenses, including depreciation and amortisation – 782 – 778 – 4 – 0.5 Profit or loss before tax 293 – 274 568 > 100.0 Consolidated net profit 201 – 185 386 > 100.0 Return on equity in % 6.7 – 6.3 Cost-income ratio in % 64.3 118.7 30.6.2021 31.12.2020 Change Figures in the statement of financial position in € m in € m in € m in % Measured at amortised cost Loans and advances to banks 15,181 17,922 – 2,741 – 15.3 Loans and advances to customers 113,504 113,925 – 421 – 0.4 Trading assets 16,750 21,173 – 4,423 – 20.9 Financial assets measured at fair value (not held for trading) 28,623 34,438 – 5,814 – 16.9 Measured at amortised cost Deposits and loans from banks 60,341 54,391 5,949 10.9 Deposits and loans from customers 64,475 63,062 1,413 2.2 Securitised liabilities 47,159 49,869 – 2,710 – 5.4 Trading liabilities 12,802 17,793 – 4,991 – 28.1 Financial liabilities measured at fair value (not held for trading) 19,766 21,864 – 2,098 – 9.6 Equity 8,925 8,842 83 0.9 Total assets 217,150 219,324 – 2,174 – 1.0 30.6.2021 31.12.2020 Key indicators for regulatory purposes in % in % CET1 capital ratio 14.0 14.7 Tier 1 capital ratio 14.7 15.6 Total capital ratio 17.9 19.1 6 7 Contents The Helaba Group 4 Helaba ratings 5 The Helaba Group in figures 8 Preface to the half-yearly financial report Interim Group Management Report 12 Basic Information About the Group 17 COVID-19 Crisis 19 Economic Report 23 Financial Position and Financial Performance 31 Risk Report 42 Outlook and Opportunities Consolidated Interim Financial Statements 50 Consolidated Income Statement 51 Consolidated Statement of Comprehensive Income 52 Consolidated Statement of Financial Position 54 Consolidated Statement of Changes in Equity 55 Consolidated Cash Flow Statement 56 Notes 138 Responsibility Statement 139 Review Report 142 Helaba Addresses 144 Imprint 8 The Helaba Group Preface to the half-yearly financial report In the first half of 2021, Helaba generated consolidated profit before taxes (in accordance with IFRS) of € 293 m – a figure that is well above the corresponding prior-year figure and, roughly speaking, represents a return to the normal pre-COVID-19 level. Consolidated net profit, i.e. the profit after tax, came to € 201 m. The excellent results for the first half of 2021 were based on sound perfor- mance in all segments. This strong showing in the first half of the year is very pleasing and the operating business is continuing to grow. A particularly encouraging figure is the further growth of 6 % in net fee and commission income to € 223 m. Net interest income rose by € 45 m to € 643 m. Income from in- vestment property, which is generated predominantly by GWH, went up by € 13 m in the reporting period to € 118 m. As anticipated, the temporary negative measurement effects from the first half of 2020 continued to reverse in the first six months of 2021. As a result, gains and losses on measure- ment at fair value improved substantially to a net gain of € 185 m. At € 41 m, other net income/ex- pense remained approximately at the prior-year level. Our diversified business model is providing us with the stability we require and enabling us to generate further growth. At the same time, we have maintained our prudent approach, recognising a net addition to loss allowances of € 141 m, which is roughly at the level of the corresponding 9 prior-year period and therefore once again a figure we believe to be more than adequate. Overall, Helaba continues to benefit from a high-quality portfolio. For example, there have been hardly any appreciable loan defaults to date. Thanks to the scheduled implementation of our transformation programme, we have been able to achieve further cost reductions at Helaba Bank. On the other hand, investment in strategic growth initiatives at the subsidiaries has led to higher overall personnel expenses. There has also been a further rise in the bank levy, but general and administrative expenses remained steady overall at € 782 m. Helaba’s capital adequacy, which has remained very sound, led to a CET1 capital ratio of 14 %. Consolidated total assets declined slightly in the first half of 2021, by € 2.1 bn, to € 217.2 bn. On behalf of the whole of the Executive Board, I would like to extend our thanks to our customers and business partners for their enduring trust and to our corporate bodies for their constructive in- volvement. I would also like to take this opportunity to express our grateful thanks to our employ- ees, whose forward-looking dedication, exceptional efforts and exemplary team spirit are each day carrying Helaba forward in these particularly challenging times. The special relationship we have created with each other is reinforcing the sense of common purpose at the Bank, enabling us to be a strong partner providing reliable support for our customers at all times. In the current financial year, we are continuing to focus on the implementation of our strategic agenda, which is progressing well and on schedule. For example, we are diversifying our business model to an even greater extent, upgrading our IT infrastructure and continuing to expand the range of sustainable financial solutions for our customers. We have set ourselves ambitious sustain- ability targets with the aim of partnering our customers in their transition to sustainable economic activity. In this way, we intend to steer cash flows towards sustainability. We also aim to cut the emissions generated by our own operations by as much as we can. Our objective is to conduct banking business on a sustainable basis, paying due regard to the environment, climate and social responsibility with exemplary corporate governance. We want to lay the foundations today for a sustainable future. We expect the course of business over the second half of 2021 to remain positive. We therefore anticipate that the consolidated profit before taxes for the whole of the year will be well in excess of the prior-year figure. Thomas Groß CEO Interim Group Management Report 12 Basic Information About the Group 17 COVID-19 Crisis 19 Economic Report 23 Financial Position and Financial Performance 31 Risk Report 42 Outlook and Opportunities 12 Interim Group Management Report Basic Information About the Group Interim Group Management Report Sparkassen in North Rhine-Westphalia and Brandenburg com- Basic Information About plement the S-Group Concept of the Sparkassen-Finanzgruppe the Group Hessen-Thüringen, which continues in its current form. In its capacity as the central development institution for Hesse, Helaba administers public-sector development programmes Business model of the Group through Wirtschafts- und Infrastrukturbank Hessen (WIBank). Landesbank Hessen-Thüringen Girozentrale (Helaba) is a credit As a dependent institution within Helaba, WIBank enjoys a di- institution organised under public law; its long-term strategic rect statutory guarantee from the State of Hesse, which is in business model is that of a full-service bank with a regional compliance with applicable European Union (EU) law. WIBank’s focus, a presence in carefully selected international markets and business activities are guided by the development objectives of a very close relationship with the Sparkassen-Finanzgruppe.