Varengold raises earnings forecast despite audit woes
Varengold Bank has raised its earnings forecast just a few months after slashing its guidance, despite the ongoing audit of its business operations.
The institutional investor – which has backed a number of peer-to-peer lenders – has recalculated its earnings for the 2023 financial year to within the €15m (£12.85m) to €20m range.
In June, the Hamburg-based bank slashed its earnings forecast from between €40m and €50m for its fiscal year 2023, to between €10m to €15m.
It added that for the years 2024 to 2026, the bank expects pre-tax profits to fall even lower, to between €5m and €10m each year. However, this figure has also been updated, with a new estimated pre-tax profit level of between €8m and €13m per year.
Read more: Varengold restricts payment transactions amid restructuring
“The new plan now shows a significant improvement in earnings due to higher planned income, which is only partially compensated for by significant cost increases in the context of the ongoing special audit of business operations,” said Dr. Bernhard Fuhrmann, a board member at Varengold Bank.
Earlier this year, the German Federal Financial Supervisory Authority (BaFin) ordered a special audit of the bank’s business operations, which resulted in Varengold restricting some payment transactions.
At the time, a bank spokesperson said that “the effects on the issuing of the 2022 annual financial statement and a concrete correction of the earnings forecast for 2023 cannot yet be adequately assessed.”
Read more: Varengold Bank appoints lawyer Marcus Columbu to supervisory board
