Financial Results

Pictet Posts Mixed Results For 2019

Jackie Bennion Deputy Editor 6 February 2020

Pictet Posts Mixed Results For 2019

Reporting full-year 2019 results yesterday, profits are down by nearly 10 per cent but AuM is at record highs for the Swiss wealth manager.

Releasing its 2019 calendar year earnings yesterday, Pictet Group reported a 2.4 per cent year-on-year drop in operating income down to SFr2.629 billion, and a 9.5 per cent drop in consolidated net profit down to SFr539 million. The Geneva-based firm said the decline was largely due to continued investments in staff and infrastructure. The group added 374 employees in 2019. 

Assets under management or custody rose by 16 per cent to SFr576 billion to 31 December 2019, up from SFr 496 billion from the previous calendar year. The group apportioned the rise to combined strong markets and net inflows into its three business units. Net new money into asset management, wealth management and asset services reached SFr25 billion.

The core tier 1 capital ratio for 2019 remained stable at 20.5 per cent based on SFr2.59 billion of core tier 1 equity (the strongest), while the liquidity coverage ratio stood at 156 per cent. These ratios are measured against the minimum 7.8 per cent core tier 1 capital ratio set by the Swiss regulator FINMA, and the minimum 100 per cent liquidity ratio under Basel III rules.

The Swiss group is required to disclose yearly financials after changing its structure to a limited liability holding several years ago.  

Pictet has been expanding its business footprint in a number of regions, such as Asia, where its ascent has been associated with a bidding battle for local talent.  (See also some senior wealth management appointments in Asia.)

Fossil fuel exposure
Following a pledge to eliminate balance sheet exposure (gross and net) to fossil fuel producers and extractors, including oil, gas and thermal coal, the Swiss firm said that exposures would be reduced to zero by the end of 2020. At 31 December 2019, these assets stood at SFr250 million.

“Irrespective of collective public sector action on moving to a carbon-neutral economy, companies in the private sector should also advance this objective independently. As we have full control of our balance sheet, this is one undertaking that we can make now,” Renaud de Planta, senior managing partner said.

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