BCV Group posted strong first-half results in an environment marked by the global economic downturn and the financial crisis. Business volumes grew sharply across virtually all segments, demonstrating the continued trust of the Bank’s customers. Revenues rose 14% year-on-year to CHF 479m*, driven by a significant improvement in trading activities. Gross profit was up 37% to CHF 228m. As expected, since the Group's earnings are no longer enhanced by extraordinary revenues, net profit normalized at CHF 136m.
Revenues up 14%
Group revenues were CHF 479m, a 14% increase compared with the first half of 2008.
Interest income edged down 2% to CHF 253m despite higher business volumes. This slight decline stems from the Bank's prudent approach to liquidity management, with the significant cash inflows during the period being placed mainly at the Swiss National Bank (SNB). Commission and fee income fell 10% to CHF 160m owing to the unfavorable capital-market conditions.
Trading income bounced back into positive territory at CHF 46m after a loss of CHF 45m in H1 08.
Other ordinary income declined 36% to CHF 20m, reflecting a fall-off in sales of financial investments compared with the very high levels seen in recent years as a result of the Group's realignment strategy.
Gross profit up 37% to CHF 228m
In line with the Bank’s cost control strategy, total operating expenses were down 1% to CHF 251m. Personnel costs declined 1% to CHF 155m, and other operating expenses fell 2% to CHF 96m. Gross profit rose 37% to CHF 228m. This strong rise was driven by revenue growth combined with strict cost control.
Net profit at CHF 136m
Depreciation and write-offs were stable at CHF 39m. Value adjustments, provisions and losses amounted to CHF 17m. Despite the current economic climate, provisioning needs remained moderate, confirming the healthy resilience of BCV's loan book.
As expected, there was a substantial decrease in extraordinary income, which fell from CHF 114m to CHF 5m (-96%). This led to a 29% drop in net profit to CHF 136m. Excluding extraordinary items, however, net profit showed an increase proportional to that of gross profit. The cost/income ratio registered a marked improvement, moving down from 70% to 61%.
Growth in customer business volumes
Total assets rose 2% to CHF 36.1bn during the first half of 2009.
There was a sharp rise in mortgage lending, which gained 5% (CHF 817m) and totaled CHF 18.1bn at 30 June. Other customer loans and advances dropped 5% (CHF 294m) to CHF 5.3bn, mainly reflecting reductions in trade-finance operations.
In order to limit bank-counterparty risk exposure, BCV reduced amounts due from banks by 37% to CHF 4.9bn. As a result, cash holdings with the SNB rose by CHF 2.3bn to CHF 2.9bn, and financial investments grew by CHF 1.2bn (+78%) to CHF 2.8bn through added placements in top-rated bonds.
On the liabilities side, customer savings deposits increased 10% (CHF 0.9bn) to CHF 9.4bn, and other customer accounts grew by 8% (CHF 1bn) to CHF 14bn. This marked rise reflects the confidence enjoyed by BCV Group. Capital ratios remained at comfortable levels, with the FINMA capital adequacy ratio at 180% and the BIS Tier 1 ratio (Basel II IRB) at 18.3%.
Assets under management on the rise
Group assets under management rose by 7% (CHF 4.6bn) to CHF 71.4bn. Net new money for the period amounted to CHF 2.1bn.
Outlook
These results are very satisfactory, demonstrating strong client confidence and the resilience of the Bank's loan book in an unfavorable economic environment. BCV Group expects business development in H2 09 to be similar to that in the first half.
Lausanne, Switzerland, 20 August 2009
* All figures in this press release are unaudited.
Contacts
Christian Jacot-Descombes, Press Officer
Phone + 41 21 212 28 61
E-Mail christian.jacot-descombes@bcv.ch
Thomas W. Paulsen, CFO
Phone +41 21 212 20 71
E-Mail thomas.paulsen@bcv.ch
This press release is being issued outside the trading hours of the SIX, Swiss Exchange in order to comply with the principles of ad hoc disclosure pursuant to the SIX listing rules.
The above text is a translation of the original French document; only the French version is authoritative.