Swiss private bank EFG International has posted net profit of CHF339.3m for the year ended 31 December 2016, a huge surge compared to CHF57.1m a year ago.
The bank’s operating income during the period was CHF722m, up 3.6% from CHF696.7m in the prior year.
Net interest income dipped 1.8% year-on-year to CHF196.9m. Operating expenses increased 14.2% to CHF690.4m in 2016 from CHF604.3m last year.
Overall, revenue-generating assets under management (AuM) for EFG at the end of 2016 were CHF144.5bn.
At the end of 2016, the group’s Swiss GAAP common equity Ratio (CET1) was 18.2% and its total capital ratio was 20.0%.
EFG said that its 2016 performance was positively impacted by the acquisition of local rival BSI, which was concluded in November 2016 for CHF1.06bn.
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The price paid during the deal completion was lower than the original announced price of CHF1.3bn after BSI was found to be embroiled in the Malaysian state fund 1Malaysia Development Berhad (1MDB) scandal and was stripped off its merchant bank status in Singapore.
EFG now intends further slash the purchase price by CHF 277.5m.
EFG’s valuation is “subject to BTG’s expected objection and, if necessary, verification by an independent expert as required under the SPA, which could lead to a change of the purchase price adjustment”.
EFG International CEO Joachim Straehle said: “With the acquisition of BSI, EFG reached an important milestone in its history in 2016. While focusing on the completion of the transaction and on driving forward the integration process, we maintained our underlying profitability in a challenging market environment due, in particular, to the disciplined execution of our cost reduction programme.“Our priority for the coming years is to fully realize the potential of this transformational business combination for the benefit of our clients, shareholders and employees.”“Our priority for the coming years is to fully realize the potential of this transformational business combination for the benefit of our clients, shareholders and employees.”
“Our priority for the coming years is to fully realize the potential of this transformational business combination for the benefit of our clients, shareholders and employees.”