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A Year of Transformation

The parent didn’t fare much better: KBL tapped reserves to cover a 22-million-euro loss in what the bank termed a «year of transformation», from 35.2 million euros a year ago. KBL’s switch to new accounting rules cost it income. The group is also investing in its technology platform and cutting staff.

To be sure, Merck Finck went on a hiring spree last year, snapping up 20 private bankers to cater to wealthy clients in southwest Germany. The wealth managers will join Merck Finck this year, which the bank said lays the foundation for asset and revenue growth.

A Bright Future?

Schellenberg said simply he expects a «considerable» improvement in assets under management and operating profit this year – without elaborating. «Some of the measures implemented in 2019 won’t be fully felt until coming years,» the bank said. Its cost-income ratio – a bloated 120 percent last year – would improve in coming years, it pledged.

In other divisions, results were mixed. Holland’s Insinger Gilissen tripled profit to 10.2 million euros and the U.K.’s Brown Shipley announced the acquisition of NW Brown & Co., a company with assets under management of 1 billion pounds ($1.2 billion). Puilaetco Dewaay Luxembourg met the challenge of volatile markets by repositioning itself.

Dividends Drop

KBL doesn’t present the results of each of its units but said that the dividend from the network of banks dropped to 37 million euros from 65 million euros. The cost-income-ratio worsened to 97.5 percent from 91.4 percent and assets under management in private banking were down to 39.5 billion euros, from 45.3 billion. 

Adding Bank am Bellevue, which posted an 8.2 million franc ($8.4 million) loss last year, would seem less of a glorious purchase under the circumstances and Zeltner seems to have embarked on a growth program with the brakes still on. The Swiss banker will obviously have known the figures when he accepted the job, meaning that he believes in the potential of the firm, or, alternatively, in the deep pockets of the owners in Qatar.