KfW Group has reported a promising start to 2025, despite ongoing geopolitical challenges. The group's new business commitments rose slightly in the first quarter to EUR 17.7 billion, compared to EUR 17.5 billion in the same period last year. The domestic promotional business saw growth with commitments reaching EUR 12.5 billion, driven by strong demand from small and medium-sized enterprises (SMEs) for climate, environmental, and innovation-related projects.
CEO Stefan Wintels stated, “Our new business in the first three months shows that demand for KfW promotion is strong.” He emphasized that SMEs are utilizing KfW funding primarily for investments in innovation and climate protection.
Export and project finance commitments were lower than the previous year at EUR 4.5 billion due to the nature of large individual transactions typical of this sector. Meanwhile, KfW Development Bank's commitments remained stable at EUR 509 million.
KfW's consolidated profit for Q1 2025 was significantly lower at EUR 117 million compared to EUR 461 million last year, largely due to conservative risk provisioning amid a challenging geopolitical environment. However, Wintels noted that "KfW’s profitability remains stable even in a very challenging environment," highlighting its role in strengthening Germany's competitiveness and promoting sustainable change.
The group's net interest income before promotional expenses was close to last year's level at EUR 658 million. Promotional expenses increased notably to EUR 115 million from higher interest rate reductions aimed at supporting start-ups and corporate investments.
In terms of capital ratios, KfW maintained robust levels with a common equity tier 1 ratio of 28.6%, despite regulatory changes under CRR III affecting total risk exposure amounts.
In various sectors:
- SME Bank recorded over EUR 4.9 billion in new commitments.
- Private Clients saw a slight decrease with new commitment volumes at EUR 5.9 billion.
- Customised Finance and Public Clients matched last year's commitment volume at approximately EUR 1.6 billion.
- KfW Capital had around EUR 41 million in commitments.
- KfW IPEX-Bank reached new commitments of EUR 4.5 billion by end-Q1.
- In developing countries and emerging economies, DEG committed around EUR 130 million.
To fund its promotional activities, KfW raised funds amounting to EUR 30.6 billion on international capital markets during Q1.