The private bank's profits suffered from headwinds of lower transaction volumes and negative interest rates, while AuM rose and the business remained financially robust.

Geneva-headquartered Pictet has reported operating income of SFr1.033 billion ($1.056 billion) in the first six months of this year, down by 1.3 per cent from a year ago, with weaker trading volumes and negative Swiss interest rates dampening profits.

Operating results were SFr244 million, down 14.3 per cent year-on-year, and consolidated net profits were SFr191 million, a fall of 15.5 per cent, the banking group, which operates in a number of regions, said late last week.

Assets under management or custody were SFr436 billion at 30 June 2016, compared to SFr437 billion at 31 December 2015, as net inflows were offset by foreign exchange and market effects.

The bank's core tier one capital ratio rose to 22.3 per cent, based on SFr2.51 trillion of common equity tier one (CET1), a measure of a bank's capital strength.

Pictet’s ratios compare with the minimum 4.5 per cent core tier one capital ratio stipulated by the Basel III regulations. Pictet’s Swiss regulator FINMA requires a minimum core tier one capital ratio of 7.8 per cent.

“The Pictet Group’s partnership structure, its strong balance sheet and capital ratios allow us to concentrate on creating value for the long term. We have therefore continued investing in the first half of 2016 in our staff and infrastructure despite weak markets, low trading volumes and negative interest rates, all of which adversely affected profitability,” said Nicholas Pictet, managing partner.