BCV Group has delivered solid 2014 results. In an environment that remains mixed, operating profit edged up 1% to CHF 476m and net profit rose 6% to CHF 296m on the back of stable revenues (CHF 993m) and operating expenses (CHF 517m). At the upcoming Annual Shareholders’ Meeting, the Board of Directors will propose an ordinary dividend of CHF 22 per share, as well as a special distribution of CHF 10 per share out of paid-in reserves, in accordance with the distribution policy announced in 2013. Altogether, the Group will pay out CHF 275m to shareholders.
Total revenues were unchanged year-on-year at CHF 993m. Despite the ongoing decline in interest rates, interest income held steady at CHF 504m thanks to expanding business volumes and effective balance sheet management. Fee and commission income increased 1% to CHF 343m. Trading income retreated 6% to CHF 106m, reflecting low client-driven forex activity over the year. Other ordinary income was CHF 40m.
Operating profit of CHF 476m
Operating expenses were stable at CHF 517m. Personnel costs were up 1% to CHF 339m following the absorption of 80 IT specialists from IBM in 2013. Other operating expenses were down 2% to CHF 178m. Operating profit edged up 1% to CHF 476m.
Net profit of CHF 296m
Depreciation and write-offs fell 7% to CHF 80m owing to cost savings associated with the absorption of the 80 IT specialists. Value adjustments, provisions and losses declined 20% to CHF 34m. Credit-risk provision releases generated most of the CHF 19m in extraordinary income booked in the reporting period. Net profit rose 6% to CHF 296m, and the cost/income ratio improved from 61% to 60%.
Continued growth in customer-driven business volumes
Total assets expanded 4% to CHF 42.1bn. Mortgage lending rose 3% (+CHF 680m) to CHF 24.1bn. Other loans increased 5% (+CHF 280m) to CHF 5.7bn.
On the liabilities side, customer savings and investment accounts continued to expand, rising 2% (+CHF 215m) to CHF 13.0bn. Other customer accounts grew 5% (+CHF 800m) to CHF 16.3bn.
Rise in AuM of 3%
The Group's assets under management (AuM) were up 3% (+CHF 2.5bn) to CHF 86.4bn. Strong market gains offset net fund outflows of CHF 1.9bn. The CHF 1.9bn aggregate net outflow comprises an inflow of CHF 0.8bn from SMEs in the region and onshore retail and private banking customers, coupled with outflows of CHF 1.5bn among large corporate and institutional clients and CHF 1.2bn among offshore clients.
Solid financial position
Equity capital remained at a comfortable CHF 3.3bn, equating to a capital ratio of 17.2%, which attests to the Bank’s financial solidity. Standard & Poor's reaffirmed BCV’s AA rating, underlining the Bank's position as one of the best-rated financial institutions in the world at a time when the financial sector in general is experiencing a deterioration in credit ratings.
Key events in 2014
CHF 275m paid out to shareholders
In accordance with the distribution strategy that was renewed for another five years in 2013, BCV returned a total of CHF 32 per share, or CHF 275m, to its shareholders in May.
New Board member
At the Shareholders' Meeting held on 1 May, Ingrid Deltenre, Director General of the European Broadcasting Union (EBU), was elected to replace outgoing Board member Beth Krasna. Ms. Deltenre has acquired extensive management experience in marketing and the media industry over the course of her career.
New Head of the Retail Banking Division
On 3 March, José François Sierdo took up his position as Head of the Retail Banking Division and Member of the Executive Board. Mr. Sierdo has more than 20 years of banking experience in Switzerland and abroad as well as in-depth knowledge of the Canton of Vaud. This makes him the ideal person to lead the development of BCV’s retail activities going forward. He was appointed by the Board of Directors to replace outgoing Board member Markus Gygax.
The Swiss cantonal banks sell their holdings in Swisscanto to Zürcher Kantonalbank
BCV announced on 11 December 2014 that it would sell its 7.3% share in Swisscanto, the cantonal banks' joint investment-fund venture, to Zürcher Kantonalbank (ZKB). This sale is part of a deal under which all the cantonal banks agreed to sell their holdings in Swisscanto to ZKB. The profit contribution on this transaction will be booked in 2015 and will amount to approximately CHF 18m.
The transaction does not affect BCV clients currently holding or wishing to purchase Swisscanto fund units.
Proposed CHF 275m payout
In accordance with the distribution policy, the Board of Directors will submit a proposal to pay an ordinary dividend of CHF 22 per registered share at the Annual Shareholders’ Meeting on 23 April 2015 in Lausanne. It will also propose a special distribution of CHF 10 per share out of paid-in reserves. If these proposals are approved, BCV will return CHF 275m to its shareholders. The Canton of Vaud will receive CHF 185m in distributions, together with CHF 60m in cantonal and municipal taxes for 2014, for a total of CHF 245m.
Lausanne, Switzerland, 19 February 2015
2 April Publication of the 2014 Annual Report (electronic version)
23 April First-quarter 2015 operating profit press release
23 April Annual Shareholders’ Meeting in Lausanne
27 April Ex-dividend date
28 April Dividend record date
29 April Dividend payment
20 August Half-year 2015 results
12 November Third-quarter 2015 operating profit press release
Christian Jacot-Descombes, Press Officer
Phone +41 79 816 99 30
Gregory Duong, Investor Relations Officer
Phone + 41 21 212 20 71
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.