The global expansion of our Group has placed increasing demands on our mission-critical infrastructure. This applies to posting and collection, sorting, transport, delivery and information technology. We aim to avoid business interruptions at key locations by continually monitoring critical infrastructure such as sorting and conveyor systems, air hubs and data centres. The precautions we take and our emergency and contingency plans are effective tools in preventing business interruptions or minimising their effects.

Following the complete opening up of the German mail market, our MAIL Division now faces growing competition. We are well prepared for the changed situation. With modern sorting facilities and efficient processes, we set high quality standards. We are also optimising and rendering more flexible the costs of our transport and delivery network. Consistent customer focus in conjunction with sales and marketing activities additionally reduce the risk of loss of market share.

The EXPRESS Division is exposed to fierce competition both nationally and internationally. To hold our own in this business, we are optimising our global transport network, amongst other things by building or enlarging air hubs. All processes are subject to regular analysis with the aim of effective use of deployed resources. We continuously match up the product portfolio to customer needs. With our First Choice programme, we ensure workforce awareness of the need to view customer satisfaction as a key competitive criterion.

This applies equally in the LOGISTICS Division. Loss of customers, particularly major customers, could put the attainment of our earnings and revenue targets at risk. Far-sighted management can limit this risk but not eliminate it altogether. With custom-tailored logistics solutions especially, our commercial success is closely bound to that of our customers. We therefore aim to support our customers with our experience, the quality of our work and a broad service portfolio.

Postbank accepts normal banking risks whilst strictly observing its risk-bearing capacity. The relevant risks are continuously measured and monitored, and regularly reported to the management. The Basel II capital adequacy requirements in force since 1 January 2007 and the Minimum Requirements for Risk Management (MaRisk) were integrated into Postbank’s risk management system at an early stage. Germany’s federal financial supervisory authority (BaFin) has permitted Postbank to use its own rating and scoring models to assess risk and ensure capital adequacy for the majority of its transactions. In the course of credit substitute transactions, Postbank has also invested in structured credit products. It has closely monitored the disruption of the capital markets arising from the developments on the US real estate market with regard to potential defaults in its structured credit portfolio. Postbank has systematically analysed its holdings on an ongoing basis and tested them for impairment. Based on a conservative assessment of the portfolio, an impairment loss in the amount of €112 million was recognised in 2007. In the event of an appreciable increase in the turbulence arising from the US real estate market and the crisis spreading to the real economy, further financial impacts cannot be ruled out.