Consolidated annual report of VP Bank Group

In 2021, VP Bank Group recorded a Group net income of CHF 50.6 million. Compared to the 2020 financial year with a Group net income of CHF 41.6 million, this corresponds to an increase of 21.7 per cent. The cost/income ratio improved from 84.5 per cent to 82.5 per cent.

VP Bank Group has a strong capital base. As of 31 December 2021, the tier 1 ratio was 22.4 per cent. In December 2020, it was 20.8 per cent.

As of 31 December 2021, VP Bank Group’s client assets under management amounted to CHF 51.3 billion. This represents an increase of CHF 8.1 per cent (CHF 3.9 billion) on the CHF 47.4 billion recorded as of the end of the ­previous year. This increase was the result of a positive net new money inflow of CHF 0.3 billion, the acquisition of the client business from Öhman Bank S.A. of CHF 1.0 billion and a positive market performance of CHF 2.6 billion.

Custody assets increased by CHF 0.1 billion from CHF 7.4 billion to CHF 7.5 billion compared to the 2020 financial year, representing an increase of 0.7 per cent. 

Client assets including custody assets amounted to CHF 58.8 billion as of 31 December 2021, an increase of CHF 3.9 billion compared to 31 December 2020 (custody assets of CHF 54.9 billion).

VP Bank recorded an operating income of CHF 329.9 ­million in the year under review. Compared with the same period of the previous year with an operating income of CHF 319.0 million, this corresponds to an increase of CHF 10.8 million or 3.4 per cent.

Income from commission business and services increased by CHF 16.5 million (11.8 per cent) to CHF 156.5 ­million. Due to the positive trends on the financial markets, recurring commission income from wealth management increased by CHF 18.8 million or 18.4 per cent and amounted to CHF 121.2 million as of 31 December 2021. Transaction- based commission income fell by 6.1 per cent to CHF 35.3 million compared to the previous year’s income of CHF 37.6 million. Income from securities account fees increased by CHF 4.9 million or 25.6 per cent to CHF 24.1 million, as did income from fund management, which rose by 11.5 per cent to CHF 58.9 million.

Net interest income fell by CHF 3.6 million in comparison to the previous year to CHF 110.0 million in the year under review. Interest income fell by CHF 15.3 million, corresponding to a decrease of 11.0 per cent. This is mainly due to the lowering of US dollar and euro interest rates by the central banks in the first half of 2020. Interest expenses also fell by CHF 11.8 million or 46.0 per cent due to interest rate trends.

Income from trading activities amounted to CHF 50.0 million, a decrease of CHF 6.6 million or 11.7 per cent compared to the previous year. This decrease is also primarily related to a further reduction of US dollar and euro interest rates by the central banks in the first half of 2020, which had a negative effect on swap transaction margins.

Income from financial investments made a positive contribution of CHF 11.5 million to the annual results. Compared to the previous year, this corresponds to an increase of CHF 3.6 million. This increase is mainly due to higher dividend income from financial instruments of CHF 7.4 million compared to CHF 4.7 million in the previous year, as well as income from financial instruments measured at fair value of CHF 2.5 million, an increase of CHF 2.2 million.

Operating expenses rose by CHF 2.6 million or 1.0 per cent from CHF 269.5 million in the previous year to CHF 272.1 million in the reporting period. 

Compared to the previous year, personnel expenses rose by CHF 11.9 million or 7.3 per cent to CHF 174.0 million. The growth in personnel is due to investments in the new Client Solutions business segment and in the Asia region.

General and administrative expenses rose by CHF 3.5 ­million to CHF 62.4 million. This increase is mainly related to ­investments in IT strategy and higher supervisory fees. Depreciation and amortisation increased by CHF 7.6 million to CHF 36.4 million due to the commissioning of projects. 

In the reporting period, valuation adjustments, provisions and losses of CHF 0.6 million net were released, whereas in the previous-year period CHF 19.8 million had to be created, mainly in connection with an allowance on a credit position of around CHF 20 million.

Total assets amounted to CHF 13.2 billion as of 31 December 2021. Compared to 31 December 2020, this corresponds to a decrease of CHF 0.3 billion or 2.4 per cent. Amounts due from banks fell by CHF 0.1 billion or 5.3 per cent, and cash and cash equivalents by CHF 0.2 billion or 8.0 per cent. On the liabilities side, amounts due to banks decreased by CHF 0.2 billion or 71.7 per cent. Bonds decreased by CHF 0.1 billion or 28.2 per cent due to a repayment of a maturing issue in April 2021.

VP Bank Group has a very good level of liquidity with cash and cash equivalents in the amount of CHF 2.4 billion. This corresponds to 18.1 per cent of total assets, which is reflected in a very good liquidity coverage ratio (LCR) of 160 per cent.