Mirabaud, the Geneva-based private bank, was also hurt by market turmoil as profit contracted. It is positioning itself for the future by withdrawing from less profitable endeavors.
The Mirabaud Group reported a net profit of 32 million Swiss francs ($34.6 million) last year, down from 50 million a year ago the private bank announced Friday.
Like many other wealth managers, it reported a decline in fee-generating assets to 31.5 billion francs from 38.9 billion a year ago, most of it the result of a challenging environment on many fronts last year. It reported net client outflows of 1.9 billion.
«Given the geopolitical tensions, the return of inflation, and the strongly negative market performance of the financial year, the result is in line with our expectations, especially in view of the fact that we have deliberately withdrawn from certain lower-priority markets and have invested significantly in a new digital ecosystem,» said senior managing partner Yves Mirabaud.
On Solid Footing
A move out of less profitable markets, investing in digital transformation, and recruiting new talent is putting the firm on solid footing for its future development, Mirabaud said.
Last year, «the bank has targeted accents in its main markets and deliberately moved away from business areas of secondary importance, with a corresponding impact on customer deposits,» said managing partner Camille Vial.
It expanded its private market offerings with investments in private equity, club deals, and real estate last year. Such investments require a long-term view and investment horizon, which is something that fits with its philosophy.
The group has a Tier 1 capital ratio of 20.3 percent and a liquidity ratio of 190 percent, both well above Basel III regulatory requirements.
Digital Transformation
Mirabaud is also undergoing a multi-year digital transformation of its private banking business, which includes a complete overhaul of its IT infrastructure and client interfaces. As part of that effort, it developed the concept for a new smartphone banking app. «At the same time, we remain true to our personalized approach, which is firmly embedded in our DNA,» Vial said.
It also turned the cost screws, with operating expenses down to 239.4 million from 252.5 million the year before. That helped to offset to some degree a decline in sales of 22.3 million last year to 290.4 million.
Looking ahead, the firm seeks to build on its private equity success with the launch of new strategies this year.
Mirabaud will play host to the general assembly in Geneva this year of the Henokiens association, to which it was admitted last year. It is a group of over 50 family-owned companies that are more than two centuries old and still owned or managed by the founding members.
