IKB Deutsche Industriebank AG / Capital Increase/AGM/EGM


Release of a Corporate-announcement, transmitted by DGAP - a company of EquityStory AG.
The issuer is solely responsible for the content of this announcement.

Restated 2006/07 financial statements confirmed

Based on the insights related to the sub-prime crisis and the findings of a
special report by PricewaterhouseCoopers, the newly appointed Board of
Managing Directors resolved to restate the Group’s consolidated financial
statements for the financial year 2006/07, as well as the financial
statements of IKB AG. IKB already announced on 16 October 2007 that these
changes were expected to reduce IKB's operating results for the financial
year 2006/07 by up to € 180 million on group level.

The changes that were applied relate in particular to the consolidation of
Rhineland Funding and on parts of an issuing entity whose securities serve
as a vehicle for IKB’s proprietary investments. The process of
consolidating Rhineland Funding in retrospect has been extremely complex
and time-consuming, as it involved 28 entities each preparing their own
annual and interim financial statements. IKB today presents the restated
financial statements. Therewith IKB fulfils the requirements for the
invitation to its Annual General Meeting for the financial year 2006/07.

Restated figures for the financial year 2006/07

The retrospective changes in accounting for IKB’s financial year 2006/07 (1
April 2006 to 31 March 2007) resulted in an operating result of € 115
million in the Group’s consolidated accounts, which is € 148 million lower
than the figure of € 263 million reported originally. This decline was
primarily due to the valuation of derivatives, which were included within
the first-time consolidation of an issuing entity, and of Rhineland Funding
(and Havenrock in particular).

The previous figures for the 2005/06 financial year have also been adjusted
accordingly, reducing the operating profit for that year from € 233 million
to € 171 million.

The restated consolidated financial statements 2006/07 report consolidated
net interest income of € 678 million. The positive difference of € 32
million compared to the € 646 million originally disclosed for the
financial year 2006/07 originates in particular from the interest income of
Rhineland Funding.

Provisions for possible loan losses of € 259 million remain unchanged;
accordingly, net interest income after provisions for possible loan losses
increased by the same amount as net interest income (+ € 32 million), to €
419 million.

Net commission income disclosed in the restated consolidated financial
statements amounts to € 52 million. The difference of € 56 million to net
commission income of € 108 million initially reported for the 2006/07
financial year is explained in particular by commission income IKB received
from Rhineland Funding. As a result of the consolidation of Rhineland
Funding commission income is now shown as interest income in the
consolidated financial statements.

Net income from financial instruments at fair value was restated at -€ 41
million. The negative difference of –€ 121 million to net income from
financial instruments at fair value originally reported for the financial
year 2006/07 (€ 80 million) resulted largely from changes in the market
value of securities and derivatives, which were included as a result of the
consolidation of Rhineland Funding referred to above, as well as parts of
an issuing entity.

Net income from investment securities of € 7 million was not affected by
the restatement, whilst general administrative expenses decreased by € 1
million, to € 316 million.

The cost/income ratio deteriorated to 45.8% (37.8% prior to restatement).
The pre-tax return on equity was 9.4% (20.6%).

IKB has not restated its quarterly results for the financial years 2005/06
and 2006/07.

Segment reporting

Segment reporting for the market-facing segments Corporate Clients, Real
Estate Clients, and Structured Finance – which will continue to comprise
IKB’s core business segments in the future – was unaffected by the

At € 34 million, the Securitisation segment, which included portfolio
investments and the securitisation of risks from assets carried on the
Bank’s books, reported a significantly lower operating result compared to
the original figure reported for 2006/07 (€ 108 million). This decline was
mainly attributable to the negative fair-value result of - € 49 million
(original result for 2006/07: € 10.1 million).

Balance sheet

Total assets increased by € 11.5 billion to € 63.5 billion as of 31 March
2007, in particular due to the consolidation of Rhineland Funding. Total
assets as of 31 March 2006 rose by € 9.1 billion, to € 53.3 billion, for
the same reason.

Annual General Meeting and Dividends

The Annual General Meeting will now be convened on 27 March 2008. No net
retained profit (Bilanzgewinn) as of 31 March 2007  will be
shown in IKB’s restated financial statements of IKB AG in accordance with
the German Commercial Code (HGB); therefore, no dividends will be
distributed. IKB had originally planned to distribute a dividend of € 0.85
per share.

Conversion of convertible bond by KfW 

The convertible bond, which was issued on 7 January 2008 and subscribed by
KfW has been converted in the mean time. On 28 February 2008 IKB will
deliver the shares to KfW. Thereby, the number of IKB shares will increase
by 8,794,661 shares to 96,794,661 shares. IKB’s core capital will increase
to € 247.8 million (from € 225.3 million). Following the conversion, KfW
will have a 43.4% stake in IKB.


The previous forecast of a consolidated loss of up to € 700 million for the
IKB Group is changed due to two important reasons: The major part of the
mark-to-market losses of approx. € 950 million resulting from the
revaluation of the portfolio investments, as reported on 13 February 2008,
need to be recognised in the profit and loss account, in accordance with
IFRS. Furthermore, on the basis of the current market situation IKB expects
a reverse (positive) valuation effect of around € 770 million, of which
only a small portion is considered sustainable. The background to this is
that IKB has opted for a valuation at fair value under IFRS for a large
part of its liabilities. These liabilities have lost heavily in market
value due to the crisis and are therefore booked at a lower market value on
the balance sheet. Under IFRS, this valuation gain is reflected in the
profit and loss account for the group. As long as it is not booked against
permanent interest and capital losses of hybrid liabilities, such gain will
dissolve until the liabilities are reimbursed and lead to a corresponding
expense. If the fair value of these liabilities rises due to an improvement
in IKB's capital market standing, this expense may also occur at a much
earlier stage.

Overall, the Board of Managing Directors expects the Group to record a loss
for the 2007/08 financial year (according to IFRS) of approx. € 550
million. The current estimate of results is still subject to significant
uncertainty. This is due to the fact that the audit of the half-year report
as at 30 September 2007 has not yet been completed. The partial sale of a
portfolio investments may also result in higher losses.

The Board of Managing Directors expects the net loss in the financial
statements of IKB AG to amount to approx. € 750 million. This figure
reflects higher losses from the revaluation of portfolio investments, which
were offset to some extent by loss-sharing on profit-participation
certificates and silent partnership contributions.

For further detailed information on IKB’s restated consolidated financial
statements and financial statements for the financial year 2006/07, please
refer to wwwwww.ikb.de.ikb.de, under the heading 'Investor Relations'

The Board of Managing Directors

Dusseldorf, 18 February 2008

Dr. Jörg Chittka (telephone +49 211 8221-4349) 
Michael Klein (telephone +49 211 8221-4920) 
Dr. Annette Littmann (telephone +49 211 8221-4745)

Dr. Roland Nolte (telephone +49 211 8221-4860) 
Facsimile: +49 211 8221-2511  
E-mail: investor.relations@ikb.de

DGAP 18.02.2008 
Language:     English
Issuer:       IKB Deutsche Industriebank AG
              Wilhelm-Bötzkes-Straße 1
              40474 Düsseldorf
Phone:        +49 (0)211 8221-4511
Fax:          +49 (0)211 8221-2511
E-mail:       investor.relations@ikb.de
Internet:     www.ikb.de
ISIN:         DE0008063306
WKN:          806330
Indices:      MDAX
Listed:       Regulierter Markt in Berlin, Frankfurt (Prime Standard),
              Düsseldorf, Hamburg, München; Freiverkehr in Hannover,
End of News                                     DGAP News-Service