Liechtenstein-based VP Bank’s net profit for the first six months of the year fell more than 50 percent. It will now look to shrink its offering and related workforce to improve efficiency.
VP Bank’s net profit in the first half of 2024 fell 54.8 percent year-on-year to 11.5 million Swiss francs ($13.3 million), according to the bank’s financial results.
Total operating income decreased 13.6 percent to 162.6 million francs, due to lower net intersect income. Operating expenses totaled 148.8 million francs, down 6 percent. As a result, the bank’s current cost/income ratio is 91.5 percent.
Client assets under management increased 8.8 percent to 50.4 billion francs, driven partly by net new money inflows of 518 million francs which corresponds to annualized growth of 2.2 percent.
Package of Measures
VP Bank has also unveiled a package of measures with the aim of achieving a minimum efficiency of 20 million francs by the end of 2026. The measures include a focus on processes that will be consistently geared towards clients, elimination of redundancies as well simplification of existing products and pricing.
Services that cannot be successfully positioned will be discontinued, such as its range of private market investments, with a reduction in the workforce size associated with such changes.
Hong Kong Closure
As previously reported, the bank once again confirmed that it would close its Hong Kong office.
«The Asia region remains important for the Group,» it added. «VP Bank will continue to grow and strengthen the Intermediaries and Private Banking presence in Asia and explore new opportunities from the Singapore location.»
«By consistently focusing on creating value for our clients, generating broad-based earnings and maintaining a high level of cost discipline, we will succeed in becoming less dependent on interest rate fluctuations and growing profitably,» commented chief operating officer and interim CEO Urs Monstein. «We are now implementing the necessary measures.»
