In a challenging environment, BCV Group’s H1 2016 operating profit remained stable at CHF 198m. Revenues decreased by 6% to CHF 494m as interest rates stayed negative, financial markets were lackluster and net trading income fell back from the record levels seen in H1 2015. As expected, net profit also came in below the exceptionally high H1 2015 figure, which was pushed up by non-recurring items relating to the sale of the Bank’s stake in Swisscanto. At CHF 157m (–13%), the bottom line nevertheless remained robust and was in fact slightly above the H1 2014 and H1 2013 figures.*
Revenues down in a difficult environment
Total revenues fell 6% year on year to CHF 494m. In an environment marked by continued negative interest rates, which the Bank does not pass on to the great majority of its customers, net interest income before loan impairment charges/reversals dropped 2% to CHF 242m. With loan impairment reversals lower than in H1 2015, net interest income dropped 5% to CHF 243m. Commission and fee income decreased by 8% to CHF 158m, reflecting a contraction in client trading volumes caused by lackluster financial markets. Following a spike in business in January and February 2015 – after the Swiss National Bank (SNB) dropped the EUR/CHF currency floor – net trading income returned to a more typical level of CHF 68m (–14%). Other ordinary income rose 19% to CHF 26m.
Operating profit stable at CHF 198m thanks to firm cost control and lower new provisioning needs
Operating expenses were unchanged at CHF 258m. Personnel costs edged up 1% to CHF 171m, while other operating expenses fell 1% to CHF 87m. Depreciation and amortization decreased 4% to CHF 37m, and other provisions and losses came in at CHF 1m, compared with CHF 27m in H1 2015. At CHF 198m, operating profit was down just 2% from H1 2015 but up 1% from H1 2014, attesting to the Group’s earnings stability.
Net profit of CHF 157m
As expected, extraordinary income declined CHF 27m versus the 2015 figure, which included the proceeds from the sale of the Bank’s stake in Swisscanto. Net profit nevertheless came in at a robust CHF 157m, down 13% on H1 2015 but slightly up on H1 2014 and H1 2013.
Growth in the balance sheet
Total assets expanded 3% to CHF 44.7bn. Cash and cash equivalents, which mainly comprise SNB sight deposits, totaled CHF 7.2bn (+4%). Mortgage lending rose 1%, or CHF 239m, to CHF 24.8bn. Other loans fell 5% to CHF 4.7bn as part of the Bank’s treasury management activities.
On the liabilities side, customer savings and investment accounts declined 2%, or CHF 459m, to CHF 28.4bn, essentially because the Bank’s online brokerage partnership with PostFinance came to an end.
The Group's assets under management were stable at CHF 87.4bn (–1%). An inflow of onshore funds (+CHF 401m) offset the expected outflow of offshore funds (–CHF 399m).
CHF 284m paid out to shareholders
In accordance with its distribution policy, BCV returned CHF 33 per share to its shareholders in April – an increase of CHF 1 per share on previous distributions – for a total payout of CHF 284m.
Solid financial position
The Bank’s capital ratio was 16.9% and shareholders’ equity amounted to CHF 3.3bn, attesting to BCV’s financial solidity. Rating agency Moody’s reaffirmed the Aa2 rating (with a stable outlook) awarded to BCV in 2015.
New head of the Business Support Division
BCV’s Board of Directors appointed Christian Meixenberger to the Bank’s Executive Board as head of the Business Support Division. Mr. Meixenberger holds an engineering degree and has broad expertise in banking technology and back-office operations. He is currently a member of the Executive Board and head of the Services Division of Banque Cantonale de Fribourg. He is scheduled to begin at BCV on 1 January 2017 and will replace Aimé Achard, who is taking his retirement.
Barring a significant deterioration in the financial markets and/or the overall economic situation, FY 2016 results are expected to be in line with those recorded in the first half.
Lausanne, Switzerland, 18 August 2016
Christian Jacot-Descombes, Press Officer
Phone: +41 79 816 99 30
Gregory Duong, Investor Relations
Phone: +41 21 212 20 71
Note to editors:
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 text is authoritative.