Postfinance, the banking arm of the Swiss post office operator, is having a hard time, given a steady erosion of interest income. The first quarter saw a further drop in profit.
Postfinance, which has its headquarters in the Swiss capital of Bern, had an operating profit of 80 million Swiss francs ($79.5 million) in the first three months of 2019. This was 16 million less than in the same period of 2018, the company said in a statement on Tuesday.
Interest income, the main source of earnings of Postfinance, declined by 42 million francs year-on-year, a development that has been weighing on earnings for years. The government hasn’t allowed Postfinance to sell loans and mortgages, but plans to do so soon.
Postfinance says that the low interest rates were one of the reasons for its difficulties, but also blamed a change in consumer demand. It will therefore focus fully on turning the firm into a digital powerhouse.
