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October 13, 2022

EFG profit surges in first nine months of 2022 even as AuM falls

EFG International has unveiled plans to attain more scale, increase digitalisation and expand activities in its key strategic markets as it registered ‘significant’ year-over-year growth in its underlying operating and net profit in the first nine months of 2022.

The Swiss private bank’s new assets reached CHF2.6bn ($2.61bn) during the same period, which represents an annual growth rate of 2%.

According to EFG, this growth shows de-risking and deleveraging by its customers across most geographies because of economic volatility.

The bank’s assets under management (AUM) reduced to CHF140.9bn at the end of September from CHF172bn in the prior year.

This fall was attributed to poor market performance and “already announced divestment of the Spanish private bank A&G”, stated EFG.

For the nine months ended September this year, EFG’s revenue margin rose to nearly 85 basis points, aligning with the bank’s target.

Operating costs remained flat compared with the same period last year.

In addition, the cost/income ratio of the bank saw further improvement to a run rate of around 75%, in line with this year’s target.

EFG International CEO Giorgio Pradelli said: “I am very proud of what we have achieved in the four years since we presented our 2019-2022 strategic plan.

“Despite external challenges, we have successfully executed our strategy and are on track to achieve all our targets.

“Our performance in the first nine months of 2022 shows that our business model can generate sustainable value throughout the economic cycle and it is a testament to our agility and resilience.”

Besides, EFG stated that it will continue its cost saving measures, such as automation, and efficiency improvements, with an aim to bring about a CHF40m reduction in its annual cost base by 2024.

Announcing its new financial targets for 2025, EFG noted that it looks to deliver 15% growth in net profit each year.  

The bank also aims to achieve an average annual net new asset growth rate of 4-6% throughout the period, along with cost/income ratio of 69%.

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