KfW's capital market activities characterised by responsibility and professionalism

Frankfurt (ots) -

- KfW benefits from "flight-to-quality"
- Funding volume for 2012 to remain constant at about EUR 80
billion
- ABS investments to support long-term financing for SMEs

In this year marked by great turmoil and high volatility, KfW has
again managed its funding very successfully. Germany's largest
promotional bank raises about 95% of its funding in the capital
market. By the end of November KfW had raised approx. EUR 78.5
billion from the issue of about 310 bonds in 11 different currencies,
which is in line with previously announced plans. The 12 benchmark
bonds issued account for around 54% (approx. EUR 43 billion) of total
borrowings and underline investors' preference for liquid products.
Other public bonds and private placements account for around 41% and
5% each of total funds raised. The euro and the US dollar were again
the most important funding currencies with a share of approx. 50% and
30% each, followed by the Australian dollar (7.4%), the British pound
(6.1%), the Norwegian krone (2.8%) and the Japanese yen (2.1%).
Detailed figures and charts on the funding in 2011 are available
under www.kfw.de/capitalmarkets-pressconference.

The success of KfW's refinancing is based on both its special
status and its successful issue strategy: KfW's unique status in the
sovereign, supranational and agency sector ('SSA') results from the
very good credit quality of the Federal Republic of Germany and the
explicit, direct guarantee. The established issue strategy plays a
major role in KfW's successful funding. "Our investors appreciate our
'3-pillar strategy' because it was implemented with foresight and
vision and because it is transparent and set for the long term.
Liquid benchmark bonds in EUR and USD, bonds in many different
currencies as well as private placements are the three pillars of our
funding - with this variety of products we convince investors
worldwide. With this strategy we are well prepared to overcome times
of crisis, which we have again proven this year," says Dr Günther
Bräunig, member of the Executive Board of KfW Bankengruppe in charge
of capital markets on the occasion of the capital market press
conference in Frankfurt.

KfW supports its broad range of products through responsible and
professional action in the capital market: The choice of the right
issue date, the focus on the specific bond maturity and size
requested at a specific time as well as market-driven pricing ensure
the solid placement of KfW bonds and a stable secondary market
performance. "With our strategy we make a substantial contribution to
the stability of KfW bonds" summarises Bräunig. "We can rightly say
that each and every benchmark bond issued by KfW this year was a
success. Our professional capital market activities ensure that we
have permanent access to many markets and all maturity segments, in
particular also long maturities."

KfW will also start off 2012 with this strategic approach. For the
coming year, the promotional bank is again planning a funding volume
of around EUR 80 billion. The bank will manage this funding
requirement with a maximum of flexibility regarding currencies,
maturities and volumes and through its unique product variety. The
funding programme includes benchmark bonds in EUR and USD as well as
a wide range of non-core currencies. "The sovereign debt crisis is
not over yet and we will most probably have to deal with high
volatility and market turbulences in 2012 as well.
'Flight-to-quality' will continue to be investors' leading topic.
Investors can further rely on our funding strategy, and I am
convinced that, given our excellent credit quality and the many
different investment opportunities we are offering, we will be
successful in 2012 as well," says Bräunig.

KfW will continue its commitment in the German securitisation
market in 2012 too with a special focus on supporting the
securitisation of SME loans. "With our commitment in the
securitisation market we support long-term financing for trade and
industry and the SME sector in Germany", explains Bräunig and
underlines the mostly positive performance of German securitisations
in the last few years: "The stable performance of German
securitisations is primarily due to the quality of the underlying
loan portfolios. This is in marked contrast to the securitisation of
US subprime mortgages."

As regards banks' demand for medium and long-term refinancing, KfW
expects secured refinancing to gain increasing importance in the next
few years. "In 2012 too, we will not only act as an investor in the
market but will continue to provide our securitisation platforms and
participate in initiatives to further develop the quality of this
market segment, thereby supporting the provision of long-term
financing for the SME sector", explains Bräunig.

Contact:
KfW, Palmengartenstraße 5-9, 60325 Frankfurt
Kommunikation (KOM), Nathalie Drücke,
Tel. 069 7431-2098, Fax: 069 7431-3266,
E-Mail: nathalie.druecke@kfw.de, Internet: www.kfw.de/newsroom