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"The increase was driven by continued net new money inflows (4%
annualised), positive stock market performance, and the
softening of the Swiss franc ‒ particularly against the US
dollar, euro, and British pound," Switzerland's third-largest
listed lender said in a statement on Wednesday.
Wealth managers saw a boon from increased client activity amid
the coronavirus pandemic in 2020, benefiting from high
transactions levels and amassing fewer loan loss risks than high
street peers.
Baer, meanwhile, has been increasing its focus on the
ultra-wealthy under Chief Executive Philipp Rickenbacher, who
assumed the role in late 2019, and trimming costs.
That helped the group achieve an adjusted cost/income ratio of
around 60% through April, an improvement from 66% in the second
half of 2020 and far ahead of the target it had previously set
for 67% by 2022.
The Zurich-based lender, which did not provide profit and
revenue figures in its four-month interim statement, also
reported an improvement in gross margin to 90 basis points, up
from 84 basis points in the final six months of 2020.
The bank in February posted a 50% rise in 2020 net profit, as
booming markets and strong client trading helped it overshoot
its mid-term targets.
But analysts had expected low and negative interest rates to
weigh on the group this year, while they also anticipated a
slowdown from frenzied activity levels.
Baer on Wednesday said client activity levels had remained
elevated throughout the first quarter, but slowed to "more
subdued levels" in April.
($1 = 0.8971 Swiss francs)
(Reporting by Brenna Hughes Neghaiwi; Editing by Michael
Shields)
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