Depfa raises profit target

Dublin-based Depfa Bank has raised its profit target for the year by €50 million after firmly beating market expectations with third-quarter numbers.

The specialist public-sector finance bank, which has its headquarters in the International Financial Services Centre (IFSC), said yesterday it was on track to record an after-tax profit of €350 million this year, up from the €300 million previously forecast.

The bank recorded a profit of €236 million last year. The increase came as Depfa reported earnings of €93 million for the third quarter, thus lifting after- tax profits for the first nine months by 62 per cent to €269 million.

The result came as revenues rose by 77 per cent to €472 million in the period to September.

Depfa, which finances public infrastructural and budgetary projects, attributed the growth to a drop in funding costs.

The bank said the successful launch of its Dublin-based asset-covered securities products were among the key drivers of the lower costs.

It also pointed to "a significant increase in demand for funding by public-sector institutions in target markets".

As yet, Depfa has been relatively inactive in the Irish market, but the bank is understood to be in continuing discussions with two parties on the provision of finance for road projects on a public-private partnership basis.