Thurgauer Kantonalbank (TKBP) H1 2024 earnings summary

Executive summary

• Net profit for H1 2024 increased by 1.2% year-over-year to CHF 81.5m, while operating profit declined by 8.9%.

• Solid growth in core business, especially mortgages, with a healthy credit portfolio and low need for value adjustments.

• Maintained leading position in mortgage lending, with a 2.9% increase in volume; customer base expanded by 3,000 and managed assets rose 3.4%.

• Cost-income ratio remains low at 45.4%, reflecting high efficiency; no account management fees introduced in April 2024.

• Equity capital further strengthened, with capital ratio at 18.8%, well above regulatory requirements.

Financial highlights

• Customer loans grew by 3.2% to CHF 26.3bn compared to December 2023.

• Customer deposits decreased by 1.5% to CHF 18.3bn.

• Net new money inflow was CHF 219m, representing 0.9% of managed assets.

• Operating income fell by 4.1% year-over-year to CHF 207.9m.

• Commission and service business income rose by 7.3% to CHF 39.4m.

• Net interest income declined by 4.2% to CHF 142m due to higher refinancing costs.

• Trading income dropped by 18.3%, mainly due to accounting changes.

• Operating expenses increased by 3.0% to CHF 96.4m, mainly due to higher personnel costs.

Outlook and guidance

• Core business expected to continue solid growth, especially in mortgages.

• Interest business normalizing; positive momentum in investment business.

• Full-year 2024 profit expected to be lower than 2023 due to normalization in interest income.