UBP increases its volumes in 2019, profit down sharply
Wednesday, 22.01.2020
news-single-imgcaption" style="width:240px">UBP’s net profit suffered from a new financial penalty in the United States. (Keystone)
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Union Bancaire Privée (UBP) ended 2019 with a marked increase in assets under management, supported by the financial markets and net contributions. The Geneva group’s revenues have stagnated, while costs linked to companies acquired have weighed on profitability. Net profit also suffered from a new financial penalty in the United States.
At the end of December, UBP posted a mass under management of 140.3 billion, an increase of 10.6% over a year, the bank said on Wednesday. Of the increase of 13.5 billion, 4.5 billion came from net inflows of money, the balance being attributable to the market effect. In 2018, net inflows reached 7.3 billion.
The funds come mainly from private clients, but also from institutions. By region, Asia, a strategic area in the field of wealth management, strongly contributed to organic growth in 2019, the statement said. The Near and Middle East as well as Eastern Europe have not deserved.
UBP’s operating income was flat (+ 0.6%) at 1.07 billion francs. The Geneva group claims a stable interest margin, brokerage revenue improved by 8% and a 12% plunge in foreign exchange transactions.
Operating expenses reached 752 million, an increase of 3.9%. Investments made for two companies acquired in 2018 – ACPI in London and Carnegie in Luxembourg – have increased costs, as has the digitization of activities.
The ratio of costs to revenues deteriorated 2.1 percentage points to 67.9%. “Our industry is facing major challenges such as negative interest rates, pressure on margins, competition from new players, or the development of digital,” said general manager Guy de Picciotto, quoted in the press release. .
Net profit declined 7.2% to 187.8 million, which includes the sale of real estate in London. On the bad news side, UBP announced at the start of the year the payment of an additional $ 14 million to the United States Department of Justice, as part of the US tax program. This amount was recognized in 2019.
As a reminder, in January 2016 the group had paid a first penalty of $ 187.8 million intended to settle the tax dispute with the United States. (AWP)
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