BENDURA BANK AG records pleasing inflow of net new money despite global crisis year
Bendern, March 31, 2021. As a result of a net inflow of new money of CHF 203 million, BENDURA BANK AG managed client assets of CHF 3.7 billion at the end of 2020. Profit after tax for the 2020 financial year amounts to CHF 1.1 million (previous year CHF 19.7 million). This result clearly reflects the further reduction in reference interest rates, especially in the US dollar, the impact of extraordinary adjustment effects in the balance sheet, and new client acquisition, which was severely impacted by the COVID 19 pandemic. Nevertheless, BENDURA BANK AG was able to record a positive inflow of new money in this difficult environment, which is a strong indicator of the institution's sustainable earning power.
Facing the challenging market environment, BENDURA BANK AG, like many financial institutions, looks back on a turbulent business year. In the interest business, the bank continues to face negative interest rates in CHF and EUR. Despite the pleasing expansion of the secured credit volume, net interest income fell from CHF 23.3 million in the previous year to CHF 15.5 million, mainly due to the recent interest rate cuts in the USA. The annual profit of CHF 1.1 million (2019: CHF 19.7 million) is significantly below the level of the previous year. At CHF 39.9 million, operating income was 28.4% lower than in 2019.
Income from commission and service fee activities amounted to CHF 20.9 million and decreased by 12.1% compared to the previous year (CHF 23.7 million). Income from payment transactions in particular continued to decline. Lower expenses for retrocessions led to a decrease in commission expenses. Income from financial transactions amounted to CHF 2.8 million and was hence about CHF 4.3 million below the previous year's result. This is due to lower income from foreign exchange transactions and a significant negative valuation adjustment of a fund in liquidation in the trading portfolio. Operating expenses amounted to CHF 31.5 million in the reporting year and increased by 3.7% compared to the previous year (CHF 30.4 million). This is primarily due to higher personnel costs, while operating expenses were reduced by 2.8% compared to the previous year
Total assets amount to CHF 1,714.0 million and are thus CHF 79.7 million higher than the total assets of the financial year 2019 (CHF 1,634.3 million). Client assets under management increased by CHF 13.3 million compared to the previous year, reaching CHF 3,685.7 million at the end of 2020 (2019: CHF 3,672.4 million).
The positive business result for 2020 will enable the bank to strengthen its equity capital by CHF 0.5 million after the planned distribution of profits. The total capital ratio of BENDURA BANK AG is around 22.0% (previous year 20.5%) and remains at an above-average level for the banking industry. Liquidity also remains at a considerable level. The high liquidity holdings make it possible for the bank to more than clearly exceed the liquidity coverage ratio of 237% as of the balance sheet date (previous year 175%).
The 2020 result shows that the Bank reacted quickly and actively to the changed environment and, despite the general development of interest rates and the continuing burden caused by the COVID 19 pandemic, was able to close with an expansion of the loan portfolio, a positive financial year and a considerable inflow of new money.
Thus, BENDURA BANK AG will continue to focus on further growth in the coming financial years with consistent cost discipline. The cornerstones for this are our highly qualified employees, the expansion of the employee participation scheme, the role of the representative office in Hong Kong in the expansion of the core markets and the completion of the extension building in Bendern in the summer of 2021, which will lay the foundation for the necessary spatial resources.
BENDURA BANK AG in a nutshell
Founded in 1998, BENDURA BANK AG is a fully licensed bank based in the Principality of Liechtenstein. The company is a subsidiary of Citychamp Watch & Jewellery Group Ltd, a luxury goods group listed on the Hong Kong stock exchange. BENDURA BANK AG offers tailor-made financial services to wealthy entrepreneurial families and high net worth individuals. The advisory groups are organised into 20 different language regions.