The end of the tax dispute with the US leaves a blemish on the financials of Geneva-based private bank Pictet. Profits declined significantly – in a difficult year, as senior partner Renaud de Planta explained on the occasion of the last financial year under his leadership.

Geneva-based Pictet Group delivered a profit of 577 million francs in 2023, the firm announced Thursday. This figure is 25 percent below the previous year. The reason for this is a fine that the bank had to pay to authorities in the tax dispute with the US.

As reported by finews.com last December, Pictet had to pay a fine of 122.9 million dollars; the equivalent of 106.8 million francs.

Declining Operating Income

Without this one-time factor, profits would have shrunk by only 9 percent. The reason for last year's disappointing performance was also the significant appreciation of the franc, the bank said. The strong franc hurt assets under management and operating income.

Operating income fell by 1 percent year-on-year to 3.16 billion francs. Assets under management or custody amounted to 633 billion francs at the end of 2023, an increase of 4 percent compared to the end of 2022. Net new assets amounted to 16 billion francs in 2023.

Difficult Year

«2023 was a challenging year for the financial industry, accompanied by turmoil in some parts of the banking sector. Against this backdrop, Pictet confirmed its stability and commitment to quality. Clients recognize the benefit of our long-term business model, which is reflected in our solid net new money,» said Renaud de Planta, Senior Managing Partner at Pictet Group.

As announced before, de Planta will step down from his position at the end of June 2024 and will be succeeded by Marc Pictet.

Stable and Solid

The group’s equity and regulatory liquidity and capital ratios remained very solid. As of 31 December 2023, total equity stood at 4.104 billion francs. The liquidity coverage ratio was 198 percent, compared to the 100 percent required by Basel III and the total capital ratio was 29.0 percent, comfortably above the 12 percent requirement set by Pictet’s Swiss regulator Finma.

At the end of 2023, the Pictet Group employed around 5,400 people at 30 locations worldwide.