A successful 2023 fiscal year for FMS Wertmanagement
Portfolio reduced by EUR 5.0 billion despite numerous macroeconomic challenges
Profit from ordinary activities of EUR 96 million for the year
Further significant year-on-year increase in net interest income
FMS Wertmanagement (FMS-WM), the German federal government’s winding-up institution, today announced that it ended fiscal year 2023 with a positive result from ordinary activities of EUR 96 million (previous year: EUR 77 million).
Portfolio wind-up in fiscal year 2023 came to EUR 5.0 billion. Since the portfolio was transferred from the HRE Group on 1 October 2010, its original nominal value of EUR 175.7 billion has been reduced to EUR 44.4 billion as at the end of 2023. This means that FMS-WM reached its target regarding portfolio wind-up for fiscal year 2023 despite numerous macroeconomic challenges.
“FMS-WM was once again successful in its wind-up activities across all segments in fiscal year 2023 as it continued to reduce risks and complexity within the portfolio. As a result, FMS-WM was able to take further steps to simplify processes and optimise its organisational structure,” said Spokesman of the Executive Board Christoph Müller.
As at 31 December 2023, total assets decreased by 11% to EUR 88.4 billion compared to 31 December 2022. This was mainly due to the unwinding of exposures and termination of derivatives as well as a decline in liquid funds.
The balance of risk provisions and net income from investments in the amount of EUR -322 million (previous year: EUR -182 million) was impacted by valuation and sale decisions as well as first-time allocation to the fund for general banking risks in accordance with Section 340g of the German Commercial Code (HGB).
General and administrative expenses in fiscal year 2023 amounted to EUR 102 million (previous year: EUR 129 million). In the previous year, this figure still included one-off effects of EUR 15 million associated with the IT transition. Independently of this, expenses associated with outsourcing were further reduced significantly in fiscal year 2023. One key factor here was the fall in expenses for FMS Wertmanagement Service GmbH, whose New York office ceased operations at the end of 2022.
Net interest income once again rose sharply year-on-year to EUR 528 million (previous year: EUR 391 million) to continue the previous year’s positive trend, primarily as a result of the rise in interest rates in currencies relevant to FMS-WM.
FMS-WM also continued to optimise its refinancing in 2023, utilising most of the EUR 60 billion funding facility provided via the Financial Market Stabilisation Fund (FMS). FMS-WM uses the funds drawn down via the FMS for funding in euros and, in conjunction with foreign exchange derivatives, for selected foreign currencies. In return, FMS-WM rolled back its own activities in the capital markets and was able to save the related costs. “All in all, this funding strategy is contributing significantly to the positive trend in net interest income and, with it, the success of FMS-WM,” said Carola Falkner, Executive Board member in charge of Treasury and Asset Management.
If the interest rates observed in currencies relevant to FMS-WM at the start of 2024 do not fall considerably, net interest income in fiscal year 2024 is expected to remain at the same level as fiscal year 2023. Subject to further geopolitical developments, particularly those associated with the conflicts in Ukraine and the Middle East and their effects as well as other unforeseen events, FMS-WM anticipates at least a breakeven result from ordinary activities for fiscal year 2024.
FMS-WM was founded in 2010 with the aim of winding up the risk positions and operations that were transferred to the company from the Hypo Real Estate Group (HRE Group) effective 1 October 2010. FMS-WM is supervised by the Federal Agency for Financial Market Stabilisation. The Financial Market Stabilisation Fund is obligated without limitation to provide additional funds under Section 8a of the German Law Establishing a Financial Market and Economy Stabilisation Fund (Gesetz zur Errichtung eines Finanzmarkt- und Witschaftsstabilisierungsfonds - Stabilisierungsfondsgesetz) for losses incurred in winding up the portfolio.
If you have any questions, please do not hesitate to contact Frank Hessel, Press Spokesman, at +49 (0)89-9547627 647 or by email at