Consolidated annual Report of VP Bank Group

In 2022, VP Bank Group recorded a Group net income of CHF 40.2 million. Compared to the 2021 financial year with a Group net income of CHF 50.6 million, this corresponds to a decrease of 20.7 per cent. The cost/income ratio changed from 82.5 per cent to 86.6 per cent.

VP Bank Group has a strong capital base. As of 31 December 2022, the tier 1 ratio was 21.7 per cent. In December 2021, it was 22.4 per cent.

As of 31 December 2022, VP Bank Group’s client assets under management amounted to CHF 46.4 billion. This represents a decline of 9.4 per cent since the start of the year, which primarily reflects the turbulent developments on the financial markets. Positive net new money of CHF 1.1 billion somewhat offset the negative market performance of CHF 5.6 billion. In addition, assets of ­sanctioned Russian clients totalling CHF 0.3 billion were reclassified.

Custody assets decreased by CHF 1.7 billion to CHF 5.8 billion compared to the 2021 financial year, representing a decrease of 22.1 per cent.

In all, client assets, including custody assets, totalled ­ CHF 52.3 billion as of 31 December 2022 and were thus CHF 6.5 billion lower than at the start of the year.

1. Includes assets of sanctioned Russian customers reclassified to client assets.

In the reporting year, VP Bank generated operating income of CHF 336.4 million. Compared to the previous-year period, this represents an increase of CHF 6.5 million, or 2 per cent.

Income from commission business and services amounted to CHF 139.6 million in the reporting period, representing a reduction of CHF 16.9 million, or 10.8 per cent. Due to lower average assets under management, recurring commission income from wealth management decreased by CHF 7.9 million, or 6.5 per cent, and amounted to CHF 113.3 million as of 31 December 2022. Transaction-based commission income fell by 26 per cent to CHF 26.2 million compared to the previous year’s income of CHF 35.3 million.

Net interest income rose by CHF 11.5 million in comparison to the previous year to CHF 121.5 million in the year under review, representing an increase of 10.5 per cent.

This solid increase is attributable to significant hikes in benchmark interest rates by leading central banks, which translates into higher interest income and higher interest expenses.

Income from trading activities amounted to CHF 65.5 ­million, representing growth of 31 per cent. This notable increase is also mainly related to the hike in benchmark interest rates by central banks, which positively influenced the margins on the swap transactions. 

Income from financial investments made a positive contribution of CHF 9.4 million to the annual results. Compared to the previous year, this represents a decrease of CHF 2.1 million. This reduction is mainly due to valuation changes of CHF 1.5 million relating to financial instruments measured at fair value.

Operating expenses rose by 7 per cent from CHF 272.1 million in the previous-year period to CHF 291.2 million in the reporting period.

Compared to the previous-year period, personnel expenses declined by 0.2 per cent to CHF 173.6 million. 

General and administrative expenses rose by CHF 14.3 million to CHF 76.6 million. This increase is primarily related to investments in the IT strategy and to additional expenses associated with the complex handling of sanctions involving Russian clients.

Depreciation and amortisation increased by CHF 4.6 million to CHF 41 million due to the commissioning of projects. This item includes an impairment of CHF 1 million that was taken on the capitalised client relationships from the acquisition of the private client business of Öhman Bank S.A.

In the reporting period, valuation allowances, provisions and losses of CHF 0.1 million, net, were released, whereas the net release in the previous-year period amounted to CHF 0.6 million.

Total assets as of 31 December 2022 amounted to CHF 12.6 billion. Compared to 31 December 2021, this corresponds to a decrease of 4.3 per cent. Amounts due from customers fell by 7.7 per cent and amounts due from banks by 8.8 per cent. On the liabilities side, amounts due to customers decreased by 5.1 per cent.

VP Bank Group has a very good level of liquidity with liquid assets in the amount of CHF 2.2 billion, which corresponds to 17.5 per cent of total assets and is reflected in a very good liquidity coverage ratio (LCR) of 233 per cent.