German lender Berlin Hyp posted a 13% increase in pre-tax profit to EUR 88.5 mln in 2010, achieving its best result in the last five years largely thanks to increased net interest and commission income, reduced provision requirements in the lending business and a successful expansion of new real estate financings.

'This development demonstrates the bank's strength and its well-functioning joint business model with its parent company, Landesbank Berlin (LLB),' said Chief Financial officer Roman Berninger. 'Increasing national and international transaction volumes on the real estate market offered opportunities for new financing that we took advantage of together with LBB.' LLB is the near-100% owner of Berlin Hyp.

Net interest income rose slightly from EUR 214 mln to 215 mln, mostly due to the growth of the interest-bearing real estate business. The bank more than doubled its commission income from EUR 7.8 mln to EUR 16.6 mln as a result of a powerful expansion of new lending business.

Berlin Hyp group concluded a total new business volume (without extensions) of EUR 3.45 bn in 2010, up 45% on 2009 volumes of EUR 2.39 bn. In the joint real estate financing sector (with LBB), the group achieved a total of EUR 6.3 bn in new lending, making it one of the leading and most active real estate finance providers in the German market. Around 70% of the lender's new lending business was in Germany.

In 2011, Berlin Hyp's strategic orientation will remain largely focused on the German investment business. Financing in selected overseas markets will be aimed at creating a well-balanced portfolio mix and increase risk distribution, it said.