Key financial results:

•    6.0% growth in balance sheet to EUR 11.5 billion
•    8% growth in total assets under management to EUR 16.8 billion
•    Common Equity Tier 1 Ratio 16.7%
•    Net profit EUR 18.7 million
•    7.1% growth in sustainable loans

Commenting on the Triodos Bank 2019 half year results, Peter Blom, Chair of the Executive Board of Triodos Bank said: “While the climate emergency has captured headlines, the role for the financial sector in shaping the sustainable economy of the future is evident. At the same time, as a bank, we wrestle with the increasing pressure on our underlying financial results as a result of a persistently low interest rate environment and costs associated with meeting substantial regulatory requirements. The challenge is to be part of the solutions for the issues of our time, like climate change and social inclusion, while making sure that we are a robust financial institution. Our focus is on working with entrepreneurs to deliver the positive social, cultural and environmental change that is at the heart of our mission.”  

Banking activities
In the six months to 30 June 2019, Triodos Bank increased its lending to support sustainable enterprises, institutions and projects. Sustainable lending grew by 7.1% in the first six months of 2019 (first six months 2018: 9.5%). The residential mortgages portfolio increased by 14.6%, compared to 17.2% in the same period last year. Total loans – which also includes residential sustainable mortgage lending - increased by 5.7% in the first half of the year.

In the first six months of 2019, the total number of customers was 705,000.

The impairments for the loan portfolio for the first half year amounted to EUR 1.2 million, compared to EUR 0.8 million in the same period in 2018, reflecting a good quality loan portfolio.

Triodos Investment Funds
Triodos Investment Management is responsible for the management of 16 investment funds, for both individual and professional investors. The assets under management of Triodos Investment Management increased to EUR 4.6 billion (30 June 2018: EUR 4.2 billion).
Details on the performance of the funds can be found at:

Financial Results
Total assets under management by the Triodos Group increased by 8.0% to EUR 16.8 billion in the first half of the year, compared to 3.9% to EUR 15.1 billion in the first half of 2018.
The ratio of operating expenses against income was 82% for the first half of the year (first 6 months of 2018: 80%)

Triodos Bank’s net profit over the first six months of 2019 is EUR 18.7 million, an increase of 1.0% compared to the same period in 2018 (EUR 18.6 million).
The net profit is under pressure due to declining margins as a result of the low interest environment, the increasing impact of negative interest on liquidities placed with the ECB and the costs of meeting significant regulatory requirements for the banking sector, as described above. The sale of a participation in Centenary Bank in Uganda, generating additional fee income for Triodos Investment Management, had a significant one-off positive effect of EUR 5.4 million on the net profit.

Capital position
During the first six months of 2019 Triodos Bank's equity increased by 3.5% to EUR 1,151 million, compared to 5.3% during the same period in 2018.
Triodos Bank has a leverage ratio of 8.6%. The Common Equity Tier 1 ratio decreased to 16.7% at 30 June 2019 (Full year 2018: 17.5%). This ratio is still above the regulatory requirement and above our own minimum target of 16%. The decrease in the first six months was mainly caused by a strong increase in risk weighted assets, due to the growth of the sustainable loan portfolio.

General accounting principles
On 4 June 2019, Triodos Bank announced it intends to adopt the International Financial Reporting Standards (IFRS) with effect from 1 January 2020.
To already better align with the IFRS framework, Triodos Bank decided to change its accounting policy related to the valuation of loans under Dutch GAAP per 30 June 2019. In the half year report, the result of this change in accounting policy is a reduction of equity of 1.8% (EUR 20.5 million) as at 30 June 2019.

A low interest rate environment and growing regulatory demands continue to put downward pressure on Triodos Bank’s Return on Equity. Therefore, Triodos Bank is working on cost efficiency, safeguarding the interest margin and increasing fee income.

Triodos Bank aims to continue to raise capital in the second half of the year to support the growth of its core activity and to maintain healthy financial ratios.

Combined these efforts are expected to lead to more impact while realising profitable growth, dealing with a challenging interest environment and meeting the increasing regulatory requirements. Triodos Bank is confident that it will be able to fulfil its front runner role in ‘Change Finance’ and support customers to meet the positive change demanded by a growing and increasingly influential community.