Luzerner Kantonalbank (LUKN) H2 2024 earnings summary

Executive summary

• Achieved record group profit of CHF 286.6 million in 2024, up 8.0% year-over-year, surpassing internal forecasts and driven by strong customer business and active interest rate management.

• Earnings per share rose to CHF 5.81, exceeding pre-capital increase levels, with a proposed dividend increase to CHF 2.60 per share.

• All strategic financial targets for the "LUKB25" period are on track or exceeded, with cumulative net profit 2021–2024 at CHF 1,075 million, above the pro-rata target.

• The bank remains the market leader in the Lucerne region, with a diversified business model and a strong focus on digitalization and sustainability.

Financial highlights

• Total operating income increased by 5.8% to CHF 650.5 million compared to 2023, continuing a multi-year growth trend.

• Net interest income reached a record CHF 444.0 million (+5.1%), with commission and service income up 10.2% to CHF 130.1 million.

• Trading income was CHF 56.5 million (–5.2%), while other ordinary income rose 33.4% to CHF 19.9 million.

• Operating expenses rose 8.4% to CHF 306.5 million, mainly due to staff and IT investments.

• Cost-income ratio at 46.1%, well below the 50% target.

• Group equity exceeded CHF 4 billion for the first time, with a CET1 ratio of 13.9% and total capital ratio of 18.5%.

• Assets under management grew 4.8% to CHF 39.5 billion, with net new money of CHF 768 million.

• Dividend proposal of CHF 2.60 per share (CHF 1.30 dividend, CHF 1.30 from capital reserves), payout ratio 41.1%.

Outlook and guidance

• 2025 group net profit guidance: CHF 265–285 million, assuming no major adverse events.

• Targets for 2025: net new money in mandates >CHF 1 billion, non-interest income >CHF 215 million, loan growth 2.0–3.75%.

• Strategic focus remains on digitalization, efficiency, and further diversification of income streams.

• New five-year strategy for 2026–2030 to be presented in late 2025.