S&P: HVB needs to restructure

Standard & Poor's said HVB's report of third-quarter 2004 results reveal the need to take further restructuring measures.

While the bank's transformation program has gradually improved year-on-year earnings, S&P said operating profit remains unsatisfactory compared with higher-rated peers.

HVB will likely fail to achieve its forecast for full-year 2004, which in S&P's view was very optimistic, however.

S&P said it believes that a new round of cost-cutting will be required to improve domestic earnings as the reliance on revenue growth in retail banking and trading income might fail to achieve desired results.

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