Vontobel increases client assets to CHF 150 billion – Group’s net new money growth hits fresh high – net profit up 15% – convincing investment performance in wealth and asset management

• As of 31 December 2012, Vontobel managed client assets totalling some CHF 150 billion, corresponding to an increase of 14%.
• The net inflow of new money in the 2012 financial year came to CHF 8.6 billion, a further increase year-on-year (2011: CHF 8.2 billion).
• Vontobel’s net profit was up 15% to CHF 130.6 million – this despite very low trading volumes on the capital markets and significant caution on the part of private clients. The wealth and asset management businesses accounted for 67% of the Group’s pre-tax profit.
• The performance of key asset management products was extremely pleasing in 2012, both in absolute terms and by peer group comparison. The Quality Growth product line followed on seamlessly from the successes of recent years, while the asset management mandates generated double-digit returns in some cases.
• As of the end of 2012, the Group’s consolidated shareholders’ equity had risen by 5% to CHF 1.6 billion. The disciplined risk appetite and clear focus of the business model are reflected in the very high BIS tier 1 capital ratio of 27.2%.
• The Board of Directors will propose to the General Meeting of Shareholders that the dividend be increased by CHF 0.10 to CHF 1.20.

Although the global equity markets performed respectably last year, confidence in a lasting positive trend remained very fragile. Investors thus maintained an exceptionally cautious stance and cash holdings remained high, particularly in the case of private clients. In this environment shaped by uncertainty, Vontobel succeeded in increasing its net profit by 15% to CHF 130.6 mn in the 2012 financial year. Over the same period, the return on equity improved by one percentage point to 8.5%.

Client assets at record high – strong inflows of new money – robust performance
Thanks to another record inflow of new money totalling CHF 8.6 bn, coupled with exceptionally robust investment performance, client assets reached around the CHF 150 bn mark for the first time. In addition to the strong showing in terms of client assets, Vontobel also achieved ambitious market share targets in the structured products business. It maintained its strong competitive position in Switzerland, and successfully expanded in Germany, where it now ranks eighth as targeted. "The above-average growth in new money of 10.5% shows the trust and confidence private and institutional clients alike have in Vontobel’s investment expertise. Our tailored investment solutions are convincing because they demonstrably add value for our clients," said Vontobel CEO Zeno Staub commenting on the performance.

Profitability increased and efficiency enhanced
The clearly higher asset base had a positive impact on the Group’s operating income in 2012, which was up 1% to CHF 775.0 mn. Net fee and commission income – by far the most important earnings component, accounting for 64% – rose by 9% to CHF 495.1 mn. Although the targets in terms of market share were met, trading income was down 7% to CHF 208.9 mn due to the lower stock market volumes. Thanks to disciplined cost management, Vontobel was also able to keep its operating expense steady year-on-year at CHF 618.7 mn, and thus improved its operating efficiency. The cost/income ratio moved in the right direction, coming in at 78.8% down from 80.0% in 2011.

Asset Management gaining in importance
At CHF 75.5 mn, Asset Management more than doubled its segment profit in 2012. The business unit acquired client assets totalling CHF 8.2 bn, in particular in the emerging markets and the US. The New York-based Quality Growth boutique again produced an excellent showing, delivering an exceptionally strong performance. Private Banking also posted an increase in client assets. However, at 8% the rise was much lower than at Asset Management (+30%). Private clients remained cautious, reflected in the doggedly high level of liquidity held at over 25%. This had a negative impact on operating income at Private Banking. Despite resolute cost reductions, the result was a lower segment profit of CHF 28.8 mn. Taken together, the wealth and asset management businesses now contribute 67% of the pre-tax profit. The subdued market activity also weighed on earnings at Investment Banking, and led to a drop in profit to CHF 68.6 mn.

Capital position remains solid – disciplined risk policy
As of 31 December 2012, Vontobel’s shareholders’ equity stood at CHF 1.6 bn, up 5% year-on-year. Despite this increase, the Group posted a higher return on equity in 2012 at 8.5%. There was a further improvement in the BIS tier 1 capital ratio, which reached an extremely solid level of 27.2%. Based on the Basel III rules applicable from 2013, it would be 24.9%.

Dividend proposal
At the General Meeting on 23 April 2013, the Board of Directors will propose to the shareholders of Vontobel Holding AG an increased dividend of CHF 1.20 (2011: CHF 1.10). This rise reflects the Board of Directors’ confidence and trust in the strategy and the considerable potential Vontobel has.

Changes in the Board of Directors
The General Meeting will also vote on the appointment of two new members to the Board of Directors. After several years’ service on the Board of Directors, both Prof. Dr. Ann-Kristin Achleitner and Dr. Philippe Cottier have decided for personal reasons not to stand for re-election. In Dominic Brenninkmeyer and Nicolas Oltramare, the Board of Directors will present two top-calibre candidates, who are entirely suitable both with a view to Vontobel’s international focus and as regards the stringent requirements expected of the Board of Directors in terms of integrity and business track record. "As a representative and high-ranking manager of the Dutch entrepreneurial family, Dominic Brenninkmeyer, who was born and raised in the UK, has a wealth of management experience in various European countries as well as in the US. With his extensive professional background as a company founder and manager, Nicolas Oltramare, who comes from French-speaking Switzerland, is well versed in the financial industry and the business challenges involved. Thanks to the experience he has amassed in his professional career and through his entrepreneurial activities, he is an expert on the economic region of Asia. With the proposed election of these two candidates to the Board of Directors, our company is underscoring its professionalism and its essence as a family business with a strong family shareholder base," stressed Chairman Herbert J. Scheidt, adding: "On behalf of the Board of Directors, I would like to express my sincere thanks to both Ann-Kristin Achleitner and Philippe Cottier for their outstanding commitment and the excellent service they have given our company. Their broad experience and wise counsel have been and still are of enormous value to our Board. I am grateful that they will be maintaining close ties with us in the future as well. I will of course be honouring their services accordingly at the General Meeting on 23 April 2013."

Outlook for 2013
The political imponderables and the expansionary policies of the western central banks will contribute to shaping market developments in 2013. Against this backdrop, and coupled with the regulatory changes, we expect that the shifts in market share between the different providers will continue to increase. Having anticipated this development at an early stage, Vontobel is committed to its focused business model and is steadily moving ahead with its implementation. We have core competencies that set us apart, and combined with the clear values our company holds, these ensure added value for our clients and profitable growth. Other integral facets include our focus on defined target markets, and the scaling of our existing booking platform in Switzerland. Working from this basis, we want to continue to strengthen our foothold in the Asia-Pacific region in 2013.

The pleasing stock market trend at the beginning of the year has been clearly more broadly based than last year. There are increasing signs of the European debt problem easing somewhat. However, it is too soon to talk of a lasting turnaround. It remains difficult to give specific forecasts with regard to business performance over the short term. We are well placed to gradually achieve our medium-term targets even in a challenging environment. Should the easing on the financial markets continue, Vontobel is well positioned to profit directly from a further upswing.

The detailed documents relating to the 2012 results (presentation, press release, Annual Report) are available online here.

Vontobel
Vontobel‘s mission is to protect and build the wealth our clients have entrusted to us over the long term. Specialising in active asset management and tailor-made investment solutions, we provide responsible and forward-looking advice. In doing so, we are committed to Swiss quality and performance standards. With their good name, our owner family has stood by these principles for generations. As of 31 December 2012, Vontobel held approximately CHF 150 bn of assets. Around 1,400 employees worldwide provide first rate, customized services for clients with an international focus. The registered shares of Vontobel Holding AG are listed on the SIX Swiss Exchange. The Vontobel families and the Vontobel Foundation hold the majority of shares and votes in the company. www.vontobel.com

 

Contacts 

Media Relations:	Reto Giudicetti	+41 (0)58 283 61 63
Investor Relations:	Susanne Borer	+41 (0)58 283 73 29

 

Key dates 

2013 General Meeting of Shareholders:	23 April 2013
First-half results 2013:	31 July 2013