Annual Results 2017: Union Bancaire Privée Net Profit up 25% to CHF 220.4 Million

GENEVA, January 18, 2018 /PRNewswire/ --

  • Full-year 2017 net profit was CHF 220.4 million, up 25% or CHF 44 million compared to the 2016 figure of CHF 176.4 million.
  • The cost/income ratio improved to 64.1% compared with 67.9% in 2016, reflecting the Group's strong earnings.
  • Assets under management reached CHF 125.3 billion, a rise of 5.9% on 2016 (CHF 118.3 billion).

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.

     (Logo: https://mma.prnewswire.com/media/630157/Union_Bancaire_Privee_Logo.jpg )

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.

http://www.ubp.com

Bernard Schuster, Head of Group Communications & Spokesperson, Tel: +41-58-819-24-70, e-mail bernard.schuster@ubp.ch

Maude Hug, Head of Media Relations, Tel: +41-58-819-75-27, e-mail maude.hug@ubp.ch

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


 

SOURCE Union Bancaire Privee, UBP SA



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