KfW

This report does not constitute a rating action. Overview Key strengths Key risks Almost certain likelihood of support from the German government due to its key role as national development bank and agent of choice for many financial support operations. Limited profit margins in government delegated business fields, partially mitigated by a legal ban on dividend payouts. Legal maintenance obligation and explicit guarantee from the German government for the bank's financial liabilities, which S&P Global Ratings considers would support timely payment. Increasing complexity of bank regulation and expansion of mandates, which could increase future capital requirements. Use of intermediary banks, collateral, and government risk absorption for delegated lending operations reduces most credit exposure to ultimate borrowers. A lending program for

...Once again, KfW is the vehicle of choice for German government crisis reaction measures, this time related to the Russia-Ukraine war. A lending program for war-affected German enterprises and liquidity assistance to systemically relevant energy companies are further examples that support our view of KfW having a crucial role for executing key German government policies. The bank's operating results should remain solid in 2022. KfW almost doubled its year-to-date new business volume compared to the same period in 2021. Its operating result before valuation for first-half 2022 amounted to almost 900 million, just marginally below that of the first six months of the prior year. KfW has expanded its funding target slightly beyond the initially planned amount for 2022. To fund the various additional activities related to current economic imbalances and to meet strong demand for housing-related lending, the bank now anticipates a slightly...

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