Vontobel (VONN) H1 2024 earnings summary

Executive summary

• Profit before tax rose 12% to CHF 173 million in H1 2024, with group net profit up 2% to CHF 130 million and assets under management (AUM) increasing 9% to CHF 226 billion, including CHF 109 billion from private clients.

• Net new money inflows reached CHF 2.3 billion, with Private Clients contributing CHF 2.4 billion and Institutional Clients stabilizing outflows.

• Strategic initiatives included a sharper distribution model, integration of Digital Investing, and acquisition of a minority stake in Ancala, enhancing private market capabilities.

• Efficiency program targeting CHF 100 million in cost savings by end-2026 is progressing as planned, with half expected by year-end 2024.

• Private Clients segment surpassed CHF 100 billion in AUM, supported by new relationship managers and integration of Digital Investing.

Financial highlights

• Operating income increased 4% year-over-year to CHF 728 million, driven by higher revenues and client activity.

• Group net profit grew 2% to CHF 130 million, impacted by a higher tax rate (25% vs. 17% prior year) due to global minimum tax regulations.

• Cost/income ratio improved to 76.1%, progressing toward the 72% target.

• Return on equity reached 12.3%, with tangible book value per share up 4% to CHF 27.72.

• CET1 capital ratio at 18.3%, total capital ratio 23.6%, and leverage ratio 4.9%.

Outlook and guidance

• Efficiency program on track for half of targeted savings by year-end 2024, full impact by end-2026.

• Through-the-cycle targets: operating income and net new money growth 4–6%, ROE above 14%, cost/income ratio below 72%, and CET1 ratio above 12%.

• Focus on expanding in core and select international markets, with continued investment in talent and technology.

• Cautiously optimistic on timing of full industry recovery for Institutional Clients.