M.M.Warburg & CO closes financial year 2024 on a modestly positive note

• Results of operations stable at previous year’s level
• Net income of EUR 1 million despite significant investments in new IT infrastructure
• Adjustments to the business model planned through a focused growth strategy in the consulting and financing business

The year 2024 was marked by significant geopolitical developments: the armed conflicts between Russia and Ukraine and in the Middle East continued unabated. In the United States, Donald Trump was re-elected president, while in Germany, the coalition government collapsed. Despite this tumultuous environment, which had a considerable impact on the capital markets, the independent private bank M.M.Warburg & CO closed the 2024 financial year with a profit of EUR 1 million (previous year: EUR 10 million). In addition, the bank significantly strengthened its capital structure by increasing its reserves.

Interest income and net commission income stable

As expected, net interest income in 2024 came in lower than in the previous year at approximately EUR 67 million. Interest expenses were approximately 10 per cent higher than in the previous year, partly due to customers shifting into higher-yielding fixed term deposits. “Despite the interest rate cuts by the central bank, we were able to hold interest income at almost the same level as last year,” explained Stephan Schrameier, member of the Executive Board of M.M.Warburg & CO responsible for the market divisions.

Net commission income remained stable year over year, at just under EUR 67 million. In particular, the different asset management solutions and strategies employed by the bank played a major role in driving commission income. “Our asset management team was once again recognised for its performance at the firstfive Awards in early 2025. It came in second place overall – a result that was particularly pleasing for our customers, as the award is based on the evaluation of real customer portfolios,” said Schrameier. firstfive AG is an independent analysis firm specialising in the comparison of asset management companies.

In 2024, Warburg added another asset management concept to its portfolio: the Smart Carbon strategy for foundations. This portfolio combines sustainable asset management with effective carbon emissions offsetting and is particularly appealing to semi-professional investors. “We plan to launch further innovative products in our private banking business in 2025 that will meet the needs expressed by our customers. We are currently looking at the area of defence, for example, among others,” said Schrameier.

Administrative expenses lower than in the previous year

The fact that M.M.Warburg & CO was able to close the 2024 financial year with a slight profit was also due to its strict cost discipline: Personnel expenses remained at the previous year’s level at approximately EUR 71 million, while “other administrative expenses” were significantly lower than in the previous year at approximately EUR 84 million – despite further significant investments in the new core banking system numbering in the double-digit million euro range. “We will be completely overhauling our IT infrastructure through mid-2026 and reducing complexity so that we can meet customer needs even more quickly and flexibly. The aim is to give our employees more time to focus on what really matters: our clients,” explained Markus Bolder, member of the Executive Board responsible for back office operations at M.M.Warburg & CO. “In addition to simplifying IT systems and outsourcing processes and services, we also plan to help achieve this through the use of generative artificial intelligence, which we are currently testing internally in a pilot project.”

Despite a high level of cost discipline, the cost-income ratio stood at 112.4 per cent in 2024 (previous year: 96 per cent). As a result, the company did not achieve its goal of continuing to improve on this figure. And even though 2024 ended on a slightly positive note overall, the bank failed to meet some of its strategic targets – particularly net commission income, which the company had actually intended to increase. “We review our strategy on an ongoing basis and have come to the conclusion that, in view of the results in the capital market business, we need to take further action,” said Bolder. The considerations were presented to the Supervisory Board in May 2025, and the planned adjustments to the business and operating model are currently being negotiated with employee representatives. “One thing is certain: we intend to continue focusing on our already profitable consulting and financing business in the future. Our focused growth strategy calls for investments in personnel, locations and products in these segments,” concluded Bolder.