Over the course of 2023’s first nine months, Vontobel produced a consistent outcome.
By the end of September 2023, assets under management had increased marginally from CHF204bn ($224bn) at the beginning of the year to CHF207bn ($227bn).
This sum takes into account net asset outflows of CHF2.5bn ($2.7bn), a positive impact from market performance of CHF7bn ($7.6bn), as well as negative currency effects of CHF1.7bn ($1.8bn).
A CHF3bn ($3.2bn) net inflow into Wealth Management and a CHF5.4bn ($5.9bn) net outflow in asset management (9M22: CHF7.3bn) ($8bn) together drove the first nine months of 2023’s CHF2.5bn ($2.7bn) net asset outflow.
By the beginning of 2024, Vontobel’s client-facing Wealth Management division is expected to employ over 50 relationship managers, as the company experienced encouraging growth in its business with wealth management clients.
Institutional investors are not making new investments because of the increased geopolitical dangers; instead, they are remaining cautious.
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This tendency in asset management has had an impact on Vontobel as well.
For the first nine months of 2023, the business that serves clients in digital investing and focuses on structured investment solutions performed well.
In addition, Vontobel maintained its dominant position in a shrinking market.
Zeno Staub, CEO Vontobel commented: “Over the last nine months, Vontobel has shown that it remains true to its strategy and is executing it step by step. This includes our recently communicated entry into the private markets business to offer additional investment opportunities to clients of Vontobel Wealth Management. In Asset Management, we are experiencing a prolonged difficult period, like many in the industry. Vontobel has the necessary strength to master this cycle in Asset Management. We will also deliver on the cost front. We are on track with the implementation of our cost efficiency programme. Our capital-light business model with a conservative risk profile is proving effective. We remain committed to our targets.”
Operating revenue in the third quarter of 2023 in the field of digital investing decreased year over year, which was indicative of a slower demand for structured products.
Vontobel’s capital position remained far above its capital targets, which were to have a total capital ratio of more than 16% and a CET1 capital ratio of more than 12%.
New Additional Tier 1 bonds (AT1 bonds) with a total value of $400m were effectively placed by Vontobel on 29 September 2023, using funds managed by Apollo Global Management in two tranches of $200m each.
Given the current circumstances, Vontobel’s placement of the new AT1 bonds demonstrates both the strength of its balance sheet and its trustworthiness as a long-term partner.
A settlement has taken place for the outstanding CHF450m ($494m) AT1 bond (ISIN CH0419042566) that was issued in 2018.