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BCV Group FY 2023 net profit up 21%, dividend and dividend target range increased

Ad hoc announcement pursuant to Art. 53 LR

BCV Group delivered record results for FY 2023. Revenues were up 12% to CHF 1.16bn on higher interest rates. Operating profit was CHF 541m and net profit was CHF 469m, both up 21%. At the upcoming Annual Shareholders’ Meeting, the Board of Directors will recommend an ordinary dividend of CHF 4.30 per share, up CHF 0.50 on the prior-year figure. After extending its distribution policy last year, BCV has now increased the dividend target range to CHF 4.30 to 4.70 per share.

Revenues up 12% to CHF 1.16bn
Total revenues were up 12% year on year to CHF 1.16bn. Net interest income grew 28% to CHF 596m on higher interest rates. Fee and commission income was stable at CHF 339m (–1%), as stronger business in the personal banking segment offset the impact of a reduction in trade finance exposures due to the current geopolitical situation. Net trading income was stable at CHF 190m (+1%). Other ordinary income declined 19% to CHF 35m, reflecting a real-estate disposal in 2022.

Operating profit up 21% to CHF 541m
Operating expenses rose 5% to CHF 541m. Personnel costs were up 3% to CHF 364m. Other operating expenses grew 8% to CHF 177m, reflecting higher costs on IT and financial information providers as well as the general inflationary environment. Depreciation and amortization increased 9% to CHF 76m. Operating profit was up 21% to CHF 541m.

Record net profit of CHF 469m
The Bank recorded a tax expense of CHF 74m. Net profit was up 21% to CHF 469m. That corresponds to an ROE of 12.5% – one of the highest in BCV’s peer group.

Total assets stable
Total assets amounted to CHF 58.9bn, edging down 1% (CHF 0.5bn) from the end-2022 figure. Cash and cash equivalents, which are mainly held as SNB sight deposits, totaled CHF 12.6bn (down 2%). Mortgage lending expanded 4%, or CHF 1.4bn, to CHF 31.8bn in a real-estate market that was slightly softer, especially in the first half. Other loans remained stable at CHF 6.1bn (–1%), as an increase in lending to SMEs and large corporates offset continued Covid-19 loan reimbursements and a reduction in trade finance activity.
On the liabilities side, customer deposits decreased 5% to CHF 36.5bn, owing primarily to a treasury withdrawal by a large institutional client.
Continued net fund inflows
The Group's assets under management rose by 4%, or CHF 4.1bn, to CHF 112.9bn. Net new money totaled CHF 539m on inflows across all business lines (individuals, SMEs, large corporates, and institutional clients) less the abovementioned treasury withdrawal and an outflow concerning the custody-only assets of another institutional client. The Bank’s investment performance drove AuM up by CHF 3.5bn.

Solid financial position
Shareholders’ equity rose 4% to CHF 3.9bn. The Bank’s CET1 ratio stood at 17.9%, attesting to BCV’s financial solidity. Standard & Poor's once again reaffirmed its AA rating for BCV with a stable outlook, and Moody's maintained its Aa2 rating, also with a stable outlook.

Very solid ESG ratings
BCV’s longstanding commitment to sustainable economic development is reflected in the Bank’s ESG scores. In 2022, MSCI upgraded the Bank’s ESG rating to AA, the agency’s second-highest rating, placing BCV in the “Leader” category. Ethos reaffirmed the Bank’s A– rating, its second-highest score, while CDP’s climate rating for the Bank is B, the third-highest of eight scores.

Proposed CHF 370m payout
At the upcoming Annual Shareholders’ Meeting, the Board of Directors will recommend an ordinary dividend of CHF 4.30 per share, up CHF 0.50 on the prior-year figure. If the payout is approved, BCV will distribute CHF 370m to its shareholders. The Canton of Vaud will receive CHF 248m in dividends together with CHF 34m in cantonal and municipal taxes, for a total of CHF 282m, or a CHF 35m increase on the prior year.

Higher dividend range and target financial ratios
Given the record 2023 results and BCV’s confidence going forward, the Bank is raising its target dividend range. This comes after BCV extended its distribution policy last year for another five years, as announced with its full-year 2022 earnings. Beginning with the 2023 reporting period, the Bank intends to pay an ordinary dividend of CHF 4.30 to 4.70, barring significant changes in the economic or regulatory environment or in the Bank’s situation.
BCV has also raised its target financial ratios. It now targets a cost/income ratio of 55% to 57% and an ROE (based on shareholders’ equity) of 10% to 12%.

Barring a significant change in the financial markets or the overall economic situation, FY 2024 business development is expected to trend along the same lines as in prior years. However, the 2024 results are expected to come in below the record 2023 numbers.

Lausanne, Switzerland, 8 February 2024

2024 calendar

25 March  Publication of the 2023 Annual Report (on
25 April     Annual Shareholders’ Meeting in Lausanne
29 April     Ex-dividend date
30 April     Dividend record date
2 May        Dividend payment
22 August Half-year 2024 results

Banque Cantonale Vaudoise – Contacts

Daniel Herrera, Communications Director
Tel.: +41 21 212 28 61

Gregory Duong, Investor Relations
Tel.: +41 21 212 20 71