Private bank EFG International saw outflows of client money during the integration of the troubled BSI bank. This was not entirely unexpected for the financial institution.
EFG International has largely completed the integration of Ticino's private bank BSI. At its Annual General Meeting, EFG also provided some information on the course of business in the last quarter of 2017. According to the announcement, this was not particularly encouraging.
The generation of profits and the development of margins had been «cautious» and corresponded to the results of the fourth quarter of 2016. EFG is talking about a persistently difficult market environment. On the other hand, the Bank continued to lower its costs, which corresponds to its plan to achieve synergies with the BSI integration.
Further Outflows Expected Until 2019
The assets under management declined significantly compared to the previous year. At the end of March, EFG managed 140.6 billion Swiss francs, compared to 144.5 billion at the end of 2016. The outflows took place mainly at BSI and were transaction-driven, according to EFG. In Switzerland, however, the trend in April has improved. EFG expects net outflows of CHF 10 billion by 2019.
With regards to the conflict with the former BSI owner BTG Pactual on the purchase price, the two institutions have begun «to establish the final valuation of the assets and liabilities as well as other price adjustments according to the procedure laid down in the purchase contract for BSI».
