The Geneva Cantonal Bank defied the recent market and political turmoil to post a record net profit for the first half of the year.
Operating income at the Geneva Cantonal Bank (BCGE) rose by 12.6 percent in the first half of the year to 231.2 million Swiss francs ($241.4 million) a performance achieved «thanks to the contribution of all the bank's business lines», BCGE said in a statement on Tuesday.
That result helped propel BCGE to post a record net profit of 78 million francs in the first half of the year, up 21.9 percent over the first six months of last year.
Private Assets Increase
BCGE also managed to attract more assets under management (AuM) from private clients, up 0.8 percent to 18.4 billion francs. Institutional clients saw their AuM battered, dropping to 14.6 billion, reflecting an 8 percent drop from the first six months of last year. Combined AuM stood at 33 billion in the first half, down 3.3 percent from the same year-ago period.
The bank is optimistic for the remainder of the year and «barring a deterioration in the economic situation and taking into account the projected business developments, the bank expects an increase in the overall earnings for the year», it said.
It improved its Tier 1 capital ratio to 15.28 percent from 15.11 percent during the first six months of the year compared to the same year-ago timeframe.
Outlook and Expansion Plans
The bank expects that interest rates will remain low and that the economic situation will improve which are factors that will weigh on the interest margin but at the same time will boost commission income.
The increase in lending is expected to remain «moderate» due to regulations governing capital requirements and a cautious policy, particularly in real estate financing.
Plans include expanding BCGE's corporate offerings in private equity and M&A and also stepping up the development of less capital-intensive businesses such as private and institutional asset management and corporate advisory services.
