The coronavirus crisis leads to a valuation adjustment in VP Bank's loan portfolio – due to a position of approximately 20 million Swiss francs.
The extent of the impact that the coronavirus is having on society and the economy, and thus on the financial markets as well, is becoming increasingly clear.
High market losses over a very short period of time and unprecedented volatility are causing a strain not only on the financial market as a whole but also on VP Bank. At the moment, however, the coronavirus crisis is leaving a mark on the loan portfolio of VP Bank, requiring a larger valuation adjustment to one individual position of approximately 20 million Swiss francs, the bank announced on Monday.
Uncertain Outlook
Supplemental stress tests on outstanding loans that have regularly been performed over past days currently do not show any additional need for a provision, the bank said. The quality of VP Bank’s loan portfolio remains high, according to further information.
Because of the uncertain situation surrounding the coronavirus, the bank cannot make a reliable forecast about further developments in the financial markets and thus about annual results, the lender said.
«However, we can today state that apart from this larger valuation adjustment on one individual position in the first quarter of 2020, VP Bank Group posted results that on whole are satisfactory. We are particularly pleased that because of the essentially defensive orientation of the portfolios, asset management has to date performed well compared with the rest of the sector,» the firm added.
