FRANKFURT/WIESBADEN (dpa-AFX) - Problems in the U.S. office market could force Aareal Bank to make higher provisions for possible loan losses this year. The situation in the market for office properties in the U.S. is "rather dark gray" at the moment, said the CEO of the commercial property financier, Jochen Klosges, on Tuesday evening at the International Club of Frankfurt Business Journalists.

"We will have a few individual cases in the U.S. where we will see higher provisioning." It is also possible that provisioning for impaired financing will be "significantly higher" than expected, he said. The board of the Wiesbaden-based institute had forecast a range of 170 million to 210 million euros for risk provisioning in the current year. In 2022, the figure was 192 million euros.

The bank, which specializes in financing commercial real estate, does 90 percent of its business abroad. North America has a share of about one-third. In the U.S. office market, the bank most recently had financing worth 3.9 billion euros on its books. The problems in this segment stem from the fact that interest rates in the USA have risen even more sharply than in the euro zone. In addition, there is a pronounced trend toward working from home.

Klosges stressed that in all other asset classes - hotels, shopping centers, logistics properties - there are "no signs of weakness at all at the moment". He added that the Management Board remained convinced that it would achieve its profit targets for the year. The target is an operating profit of 240 million to 280 million euros. In 2022, Aareal Bank had generated an operating profit of €239 million, with a profit of €138 million attributable to shareholders.

Financial investors Advent and Centerbridge and Canadian pension fund CPPIB recently acquired Aareal Bank. "We firmly believe that the investors will continue to support our strategy for the coming years," Klosges said. It has not yet been decided whether the new owners, who together hold around 90 percent of the share capital and voting rights, will take Aareal Bank off the Borse. The share is still traded on the Borse, but it was already removed from the small-cap index SDax in September./ben/DP/stk