GENEVA, January 18, 2018 /PRNewswire/ --
Investments paying off
Bullish financial markets helped increase revenue to CHF 1.045 billion from CHF 934.6 million in 2016. Revenue growth was also driven by a 14.2% rise in fees and commissions, a result of significant growth in advisory and discretionary mandates among private clients, and by an increase in interest income of CHF 25 million (10.1%) due in particular to higher dollar interest rates.
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Operating expenses remained under control, rising by 5.5% from CHF 634.7 million in 2016 to CHF 669.6 million in 2017. The increase resulted mainly from the full impact of the Coutts integration in Asia (completed in April 2016), as well as added recruitment in that region. Operating expenses also rose due to the higher cost of regulatory compliance as well as major investments in the digital offering.
Operating income before provisions rose 41.4% to CHF 271.2 million, up from CHF 191.9 million in 2016. The increase was driven by the brokerage and advisory businesses, underpinned by strong returns on the products of the Asset Management division, and also by innovative new investment offerings.
The Group was, therefore, significantly more profitable in 2017, with net profit rising 25% from CHF 176.4 million in 2016 to CHF 220.4 million in 2017, and with the cost/income ratio improving to 64.1% versus 67.9% in 2016.
At 31 December 2017, assets under management reached CHF 125.3 billion, up 5.9% (CHF 7 billion) compared with the previous financial year (CHF 118.3 billion at the end of 2016). Rising markets, net inflows from institutional investors (CHF 2.5 billion) and new money from private clients in emerging countries more than offset outflows resulting from further tax regularisations, mainly by non-European clients.
"Although these results are, in part, due to positive economic conditions and buoyant markets, they above all reflect the efforts and investments we have made over the last few years, particularly in Asia. Our 2017 performance was achieved in the context of a favourable economic environment, but it was also supported by a Swiss banking industry that is in good health," said Guy de Picciotto, UBP's CEO.
Solid fundamentals
At the end of 2017, the Group's balance sheet totalled CHF 32 billion, up CHF 1.2 billion compared with the 2016 year-end figure of CHF 30.8 billion. The Tier 1 ratio was 27.4%, well above the minima required by Basel III and the FINMA.
The Bank's prudent management of its balance sheet is also reflected in its short-term liquidity ratio which, at 278.4%, is 2.8 times the minimum required by Basel III.
UBP is one of the best-capitalised banks in its field and has the necessary means to ably develop its wealth management business for both private and institutional clients.
About Union Bancaire Privée (UBP)
UBP is one of Switzerland's leading private banks, and is among the best-capitalised, with a Tier 1 ratio of 27.4% as at 31 December 2017. The Bank is specialised in the field of wealth management for both private and institutional clients. It is based in Geneva and employs 1,697 people in over twenty locations worldwide; it held some CHF 125.3 billion in assets under management as at 31 December 2017.
Bernard Schuster, Head of Group Communications & Spokesperson, Tel: +41-58-819-24-70, e-mail [email protected]
Maude Hug, Head of Media Relations, Tel: +41-58-819-75-27, e-mail [email protected]
FINANCIAL RESULTS AS AT 31 DECEMBER 2017
(UNAUDITED ACCOUNTS)
Financial highlights for the Group
2017 2016 Variation in CHF in CHF in CHF Variation millions millions millions in % Net profit 220 176 44 24.9% Operating result before provisions 271 192 79 41.4% Client assets (in CHF billions) 125.3 118.3 7 5.9% Total operating income 1,045 935 110 11.8% Net result from interest operations 281 256 25 10.1% Net fees and commissions income 658 576 82 14.2% Profit on trading operations and on fair value options 93 96 (3) (3.3%) Total operating expenses 670 635 35 5.5% Personnel expenses 509 468 41 8.7% General and administrative expenses 161 167 (6) (3.6%) Depreciation, value adjustments, provisions and losses 104 108 (4) (3.8%) Total assets 32,036 30,823 1,213 3.9% Shareholders' equity 2,235 2,095 140 6.7% Share capital 300 300 - - Capital reserves 867 867 - - Reserves and retained earnings 632 536 96 18.0% Reserves for general banking risks 215 215 - - Staff members (as at 31 December) 1,697 1,665 32 1.9% Net profit per staff member (in CHF thousands) 130 106 24 22.5% Operating cost / income ratio 64.1% 67.9% - - Cost / income ratio after depreciation 73.3% 78.4% - - Return on equity (ROE) 10.5% 9.3% - - Shareholders' equity / total assets 7.0% 6.8% - - Tier 1 capital ratio 27.4% 24.3% - - Liquidity coverage ratio (LCR) 278.4% 262.1% - - Leverage ratio 5.4% 5.1% - -
Consolidated balance sheet as at 31 December
(in CHF thousands) 2017 2016 Assets Cash and cash equivalents 8,881,983 7,995,562 Due from banks 1,878,195 1,589,027 Due from securities financing transactions 292,545 589,600 Due from clients 7,736,181 7,097,435 Mortgages 1,475,424 1,356,208 Trading portfolio assets 23,087 21,071 Positive replacement values of derivative financial instruments 315,773 472,798 Other financial instruments at fair value 669,061 593,449 Financial investments 9,978,352 10,200,808 Accrued income and prepaid expenses 136,963 138,023 Non-consolidated participations 9,068 10,494 Tangible fixed assets 260,636 241,887 Intangible assets 347,791 413,823 Other assets 31,306 102,767 Total assets 32,036,365 30,822,952 Total subordinated claims - -
(in CHF thousands) 2017 2016 Liabilities Due to banks 541,959 617,702 Liabilities from securities financing transactions 5,938,741 2,827,106 Due in respect of client deposits 21,835,427 23,746,512 Liabilities from trading portfolios 3 280 Negative replacement values of derivative financial instruments 284,186 246,171 Liabilities from other financial instruments at fair value 722,215 750,868 Accrued expenses and deferred income 375,139 322,265 Other liabilities 74,609 158,375 Provisions 28,819 58,787 Total liabilities 29,801,098 28,728,066 Reserves for general banking risks 215,375 215,375 Share capital 300,000 300,000 Capital reserves 867,336 867,336 Reserves and retained earnings 632,192 535,744 Group profit 220,364 176,431 Total equity 2,235,267 2,094,886 Total liabilities and equity 32,036,365 30,822,952 Total subordinated liabilities - -
Off-balance-sheet transactions as at 31 December
(in CHF thousands) 2017 2016 Contingent liabilities 602,746 447,636 Irrevocable commitments 81,734 124,651 Liabilities to pay up shares and to make additional payments 171,142 142,008 Credit commitments (deferred payments) - -
Consolidated statement of income
(in CHF thousands) 2017 2016 Consolidated statement of ordinary income and expenses on banking operations Result from interest operations Interest and discount income 325,659 212,805 Interest and dividends from financial investments 102,432 104,047 Interest expense (146,772) (60,358) Gross result from interest operations 281,319 256,494 Changes in value adjustments and provisions for default risks and losses from interest operations 146 (858) Net result from interest operations 281,465 255,636 Fees and commissions Commission income on securities trading and investment transactions 674,923 590,443 Credit-related fees and commissions 3,263 2,933 Other fees and commissions income 1,939 2,838 Commission expense (22,174) (20,029) Fees and commissions 657,951 576,185 Result from trading activities and the fair value option 92,645 95,776 Other result from ordinary activities Result from the disposal of financial investments 9,378 5,342 Income from participations 1,643 2,126 of which, from participations reported using the equity method (928) (666) of which, from other non-consolidated participations 2,571 2,792 Result from real estate 738 984 Other ordinary income 864 633 Other ordinary expenses - (2,123) Other result from ordinary activities 12,623 6,962 Total income 1,044,684 934,559
(in CHF thousands) 2017 2016 Operating expenses Personnel expenses (508,795) (467,926) General and administrative expenses (160,780) (166,809) Operating expenses (669,575) (634,735) Value adjustments on participations and depreciation of tangible and intangible fixed assets (96,377) (97,865) Changes to provisions and other value adjustments and losses (7,527) (10,103) Operating result before provisions 271,205 191,856 Restructuring provision - (9,633) Operating result 271,205 182,223 Extraordinary income 4,455 114,316 Extraordinary expenses - (22,243) Changes in reserves for general banking risks - (50,000) Taxes (55,296) (47,865) Group profit 220,364 176,431
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