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Rentenbank: Promotional activity impacted by persistent investment restraint

Frankfurt. Compared to the first half of last year, demand for the special promotional loans of Landwirtschaftliche Rentenbank was considerably weaker in the first half of 2024. At EUR 1.5 billion, the volume of new loans granted was a little less than 50% of the year-ago figure. While investment restraint was evident in nearly all the bank’s promotional lines, the greatest declines were registered in its Rural Development and Renewable Energy lines. The demand for credit was dampened both by the sector’s pessimistic expectations for the future and by the currently high level of the EU reference interest rate. Rentenbank raised EUR 4.9 billion in the capital markets to fund its promotional activity. The operating result of Germany’s development agency for agribusiness and rural areas in the first half of 2024 was below the level of the year-ago period. The bank’s capital ratio and leverage ratio remained at high levels.

Rentenbank in 2023: Very good operating result, challenging year for promotional activity

Frankfurt. Landwirtschaftliche Rentenbank encountered lower demand for its special promotional loans in 2023. The volume of new, low-interest promotional loans declined by 13.6% to EUR 5.9 billion (2022: EUR 6.9 billion). The investment restraint exhibited by potential borrowers was confirmed by the findings of the Rentenbank Agriculture Barometer, which provides insights into the current situation and expectations of the German agricultural sector. Rentenbank expanded its portfolio of promotional activities to bolster the sector’s resilience and stimulate necessary investments. It is also developing additional measures to support the necessary transition of the food and agribusiness industry to more sustainable business models and practices. To fund its promotional activities, Rentenbank raised EUR 10.5 billion (2022: EUR 11.8 billion) in medium- and long-term funds in the capital market. The bank’s operating result before provisions for loan losses and valuation effects came to EUR 197.3 million in 2023, well above the level of the previous year (2022: EUR 157.8 million). The bank’s capital ratios remain at very good levels.

Rentenbank in 2023: Lower volume of new loans granted, substantially higher operating result

Frankfurt. 2023 was a challenging year for Landwirtschaftliche Rentenbank. The volume of new promotional loans declined by 13.6% to EUR 5.9 billion (2022: EUR 6.9 billion). Declines were registered in all promotional lines, but they were especially pronounced in the Agriculture and Renewable Energy lines, where promotional lending activity was dampened particularly by a lack of investment in farm buildings and machinery and by weakening demand for wind power financing. However, the volume of new loans granted in the Rural Development line rose again thanks to strong demand for Rentenbank’s global loans by the development banks of the German federal states. To fund its promotional lending business, Rentenbank raised approximately EUR 10.5 billion (2022: EUR 11.8 billion) in medium- and long-term funds in the capital market. The bank’s operating result before provisions for loan losses and valuation effects came to EUR 197.3 million, well above the level of the previous year (EUR 157.8 million), mainly due to higher net interest income on the back of rising interest rates. The bank’s capital ratios were nearly unchanged from the previous year.

Rentenbank plans funding volume of up to EUR 11 billion in 2024

Frankfurt. Landwirtschaftliche Rentenbank anticipates a funding volume of up to EUR 11 billion in 2024, to be raised on bond issues with terms of longer than two years.

Rentenbank: Demand for special promotional loans levels off again after record volume in 2022.

Frankfurt. Compared to the high volume encountered in the first half of 2022, demand for the special promotional loans of Landwirtschaftliche Rentenbank declined in the first half of 2023, with the volume of new loans granted totalling EUR 3.2 billion. Strong growth was seen in the Rural Development promotional line. Rentenbank raised EUR 7.4 billion in the capital markets to fund its promotional activity. Germany’s development agency for agribusiness and rural areas increased its operating profit considerably in the first half of 2023. The bank’s capital ratios remained at high levels.

Rentenbank: Strong promotional activity in 2022

Frankfurt. Landwirtschaftliche Rentenbank encountered sharply higher demand for its promotional loans in 2022. The volume of new, low-interest special promotional loans increased by around 23% to EUR 6.9 billion (2021: EUR 5.6 billion), while the volume of total promotional business rose significantly to EUR 11.5 billion (2021: EUR 9.8 billion). To provide better financing options to agtech, foodtech, and bioeconomy start-ups, Rentenbank invested in venture capital funds for the first time in 2022. To fund its promotional activity, Rentenbank raised medium- and long-term funds totalling EUR 11.8 billion (2021: EUR 10.7 billion) in the capital market. The Bank’s capital ratios were nearly as good as in the previous year. Rentenbank has gotten off to a successful start in 2023, having already granted new special promotional loans totalling EUR 1.7 billion.

Rentenbank in 2022: Substantial increase in demand for special promotional loans

Frankfurt. 2022 was a very successful year for the promotional lending business of Landwirtschaftliche Rentenbank. The volume of new promotional loans rose substantially. The increase in demand was especially strong in the Rural Development and Renewable Energy lines. The main driver in the Rural Development line was the strong demand for Rentenbank’s global loans by the development banks of the German states, while in the Renewable Energy line it was the strong demand for wind power financing. In total, the volume of new, low-interest special promotional loans granted rose to EUR 6.9 billion (2021: EUR 5.6 billion). To fund its promotional lending business, Rentenbank raised about EUR 11.8 billion (2021: EUR 10.7 billion) in medium- and long-term funds in the capital market. The capital ratios were nearly unchanged from the previous year.

Rentenbank plans EUR 11 billion funding volume in 2023

Frankfurt. Landwirtschaftliche Rentenbank anticipates a funding volume of EUR 11 billion in 2023, to be raised on bond issues with terms of longer than two years.

Rentenbank: Strong increase in the volume of new special promotional loans granted in the first half of 2022

Frankfurt. Landwirtschaftliche Rentenbank encountered considerably stronger demand for its special promotional loans in the first half of 2022, the volume of which rose by nearly one third to EUR 3.8 billion. The “Renewable Energy” promotional line experienced especially strong growth. The “Rural Development” and “Agribusiness and Food” promotional lines also posted considerable gains. Germany’s development agency for agribusiness and rural areas generated a lower operating profit in the first half of 2022. The capital ratios remained at high levels.

Rentenbank: Satisfactory promotional activity in 2021, followed by a strong first quarter 2022

- Especially strong increase in loan demand in the “Renewable Energy” and “Rural Development” promotional lines in the first three months of 2022

- More than half of the funding planned for 2022 was already raised at the end of March

- Capital ratios continue to be well above the regulatory requirements