Swiss consumer bank Cembra reported lower net income in the first half, but its buy-now-pay-later business is thriving.
Cembra reported a 17 percent decline in net income for the first half of the year to 75.1 million Swiss francs, but managed to book a marginal gain in net income, according to results released Thursday.
Commission and fee income rose 12 percent to 82.4 million from 73.3 million in the first half of last year. Its credit card business weighed on the result, generating 43.3 million in income which was 9 percent lower than a year ago.
BNLP Business Growing
At the same time, its buy-now-pay-later business nearly tripled as it generated fees of 19 million francs in the first half versus 6.5 million a year ago. That resulted from billing volumes for than doubling to 446 million francs from 197 million a year ago. That helped offset the decline in credit card income, and resulted in net revenues of 253 million, up 1 percent from 250 million, according to the statement.
«I am particularly pleased with the successful continuation of the migration of our cards portfolio and the strengthening of our position in the attractive BNPL market by bundling Swissbilling and Byjuno into CembraPay,» said CEO Holger Laubenthal.
Resilient Performance
The bank expects resilient business performance this year with net revenues at least in line with GDP growth, continued solid loss performance, and a stable cost/income ratio.
The return on equity is expected to be at the lower end of the targeted range of 13 to 14 percent, resulting from the time lag of the implemented repricing of new business and some shifts in the realization of benefits from the strategic initiatives. It said meeting the ROE target of 15 percent for next year «is expected to be challenging.»
It's maintaining its financial targets until 2026, including a dividend of at least 3.95 francs this year for 2023 and increasing based on earnings growth.
