24 February 2017 |

2016 private banking results round-up

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Reporting season has all but ended, with only a handful of institutions yet to post their 2016 financials (EFG, J. Safra Sarasin and Pictet to name a few). By and large, the latest batch of results confirms what we already know: 2016 was a tough year for the private banking industry, which had to contend with difficult market conditions, a pronounced downturn in transactional revenues and regulatory tightening.

While not all institutions provide the same degree of clarity, we’ve sifted through 2016 reports to provide a round-up of the most notable (and detailed) financials available for private banks with a presence in Asia. 

Bank of Singapore/OCBC- OCBC’s wealth management division (incl. private bank and insurance) record high fee-based income in 2016
- Fees income, as a percentage of total income, +0.5 pp YoY to 19.3%
operational expenses +3% YoY (Barclays Wealth integration accounted for 1 pp of increase)
- WM fees & commissions income S$588 million (+3% YoY)
- AUM US$79 billion (US$13 billion transferred from Barclays Wealth Hong Kong & Singapore)
- WM accounted for 27% of group income, at S$2.3 billion
- 44% YoY increase in AUM due to a “combination of net new money” and the Barclays acquisition
BNP Paribas Wealth Management
- Global wealth & asset management income €176 million (+9.3% QoQ, -4.9% YoY)
- Global wealth & asset AUM €1,010 billion euros (+5.8%YoY), WM AUM €344 billion
- AUM increase due to “to very good net asset inflows totalling €34.9 billion” including “strong asset inflows” for Asia private bank
Credit Suisse Private Banking
- WM “record” net revenues +17% YoY to CHF 1,374 million
- PTI of CHF 372 million, +8% YoY
- Ultra, entrepreneur & corporate clients activities deliver pro forma PTI of CHF 513 million (+65% YoY)
- APAC AUM CHF 168 billion (CHF 150 billion end-2015)
- NNA CHF 14.6 billion in 2016 (+10% annualised), “inflows primarily from Greater China and Australia”
- CHF 2.4 billion in outflows in 2016, incl. CHF 1.4 billion in Q4, attributed to “regularization”, particularly in the Southeast Asia markets
- C/I ratio for APAC private banking +1.3 p.p. to 70.6%
- APAC RM headcount 640 (+10% YoY)
DBS- WM income +19% YoY to S$1.68 billion, driven by strong performance in “loans, deposits, bancassurance and cards”
- WM fees +19% to S$714 million - a “new high”
- WM AUM (incl. Treasures, Treasures Private Client, Private Bank) +14% YoY to S$166 billion
- WM on track to reach S$189 billion in AUM acquisition of ANZ’s retail and wealth businesses completed in 2017 and 2018
Deutsche Bank Wealth Management
- International private, wealth, commercial clients division EUR 1.07 billion PTI for 2016
- Invested assets of EUR 424 billion (-16% YoY)
- Client assets of EUR 577 billion (-12% YoY)
- Q4 net outflows on invested Assets of EUR 24 billion, mainly in wealth management in Oct 2016
HSBC Private Bank- US$3.3 billion loss on the back of goodwill write off Europe business
- Global private banking adj. PBT US$0.3 billion, -$0.1 billion YoY, revenue -11% YoY
- Asia private bank PBT US$30 million for Q4, US$268 million for 2016
- HK private bank PBT US$28 million for Q4, US$221 million for 2016
- Asia client assets US$108 billion – down from US$112 billion end-2015
Julius Baer
- Operating income +6% to CHF 2.85 billion
- Adj. operating expenses -16% YoY to CHF 2 billion / +8% YoY excl. DoJ settlement
- Adj. net profit CHF 706 million
- Global AUM +12% to “record” CHF 336 billion
- NNM +CHF 12 billion (+4% annualised), “strongly supported by inflows from clients domiciled in Asia, the Middle East and Western Europe”
- C/I ratio +1.5 pp to 68.9%
- “net impact costs” of new RM hires in 2016 “a bit more than two percentage points”
- Net hire of 116 RMs, “vast majority” in Asia, Switzerland, Monaco
UBP- Global revenues +24.7% YoY to CHF 934.6 million on the back of Asia growth due to acquisition of Coutts International
- Operating expenses +22.2% YoY to CHF 634 million
- Operating income +26% YoY to CHF 191.9 million,
- C/I ratio -1.4 pp YoY to 67.9%
- Global AUM +7.6% YoY to CHF 118.3 billion, driven primarily by growth in private banking and institutional client assets in Asia, and overall positive net inflows from institutional clients
UBS Wealth Management- Globally CHF 511 million profits (-21% QoQ, +1% YoY) on back of decline in operating income for 7th straight quarter (CHF1.8 billion)
- NNM outflows driven by cross-border outflows, mainly in APAC and emerging markets
- APAC WM +0.1% (annualised) NNM in Q4, +CHF 0.1 NNM
- APAC invested assets +2% QoQ to CHF 292 billion, global invested assets (ex-Americas) CHF 987 billion
- Asia RM headcount 1,016 (-27 from Q3)