SGKB with slightly lower net profit in the first half of the year
Published: Wednesday, Aug 14th 2024, 07:10
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St. Galler Kantonalbank (SGKB) is satisfied with the first half of the year. For example, the state-owned bank was able to increase customer assets. However, it had to accept a slight decline in consolidated profit.
The operating profit as a measure of operating performance even fell significantly compared to the previous year by a good 13 percent to CHF 120.3 million, as SGKB announced on Wednesday. Net profit also fell, by 7.4 percent to 100.4 million. The operating income of the Eastern Swiss bank fell by 5.5 percent to 274.7 million francs.
Nevertheless, the bank expressed its satisfaction in its press release. Overall, it increased its business volume by 5.9 percent to 96.3 billion Swiss francs. The bank also succeeded in acquiring new money. Specifically, it received a net inflow of 1.8 billion in the first half of the year.
At the end of June, SGKB had 63.0 billion client assets under management (+7.2%), with broad-based growth in all business areas. Customer loans even reached a new high of 33.3 billion (+3.6%).
Lower net interest income
According to SGKB, it is not surprising that the profit figures were lower following the interest rate cuts by the Swiss National Bank SNB. Typically, net interest income benefits from interest rate hikes, while interest rate cuts tend to have a dampening effect. In the central interest business, the bank also recorded a decline in net income of a good 11 percent to CHF 165.6 million.
The trading business performed better. The result rose by 1.6% to 22.3 million euros. Income from the commission and services business increased by 7.6% to 82.0 million. By contrast, other ordinary income fell by just under 24 percent to 4.8 million.
On the other hand, costs increased. Operating expenses amounted to 149.6 million ( previous year 145.1 million). The cost-income ratio deteriorated to 54.1% ( previous year: 49.2%).
Earnings expected to remain at previous year's level
Kantonalbank remains fundamentally positive about future developments. For 2024 as a whole, it continues to anticipate a result at the previous year's level.
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