Reports
Market Woes Dent Vontobel's AuM; Says Capital Base Strong
The Swiss firm held its AGM yesterday, moving ahead with a bigger stake in an asset management specialist, and guiding shareholders on its capital strength.
Swiss wealth management house Vontobel assured clients and
investors of its financial health yesterday, announcing that it
intends to retain half of the profits made last year to bolster
its capital strength. It reported a dent to its assets under
management as of 24 March.
The Zurich-listed firm held its annual meeting yesterday remotely
- rather than in person - because such gatherings are restricted
during the COVID-19 pandemic.
Shareholders approved a 7 per cent rise in dividend to SFr2.25
per share which, when a 35 per cent withholding tax is taken into
account, translates into a pay-out ratio of 50 per cent, it said
in a statement.
The boardroom directors standing for re-election – Bruno Basler,
Dr Maja Baumann, Dr Elisabeth Bourqui, David Cole, Stefan
Loacker, Dr Frank Schnewlin, Clara C Streit and Björn Wettergren
– were each confirmed in office for a further term by a large
majority, Vontobel said in a statement.
Herbert J Scheidt was re-elected as chairman for another year,
also by a large majority. The members of the nomination and
compensation committees – Bruno Basler, Dr Elisabeth Bourqui,
Clara C Streit and Björn Wettergren – were confirmed in
office.
Stake
As previously announced, Vontobel is going to boost its majority
stake in TwentyFour
Asset Management, which is based in London and New York, to
80 per cent from 60 per cent in 2021. This firm specialises in
the area of fixed income investments. The acquisition of the
remaining participation will be financed from Vontobel’s own
funds.
As of 24 March, advised client assets totalled SFr194 billion, a
fall of 8 per cent compared with the average advised client
assets of SFr212 billion in 2019. The stock market turmoil also
overshadowed the positive overall trend in terms of net new
money, the firm said. Even so, Vontobel’s report said that the
annualised net inflow of SFr5.2 billion exceeded the 4-6 per cent
target range.
Vontobel said it has a “comfortable” capital position with a
Common Equity Tier 1 ratio of 13.5 per cent and a Tier 1 capital
ratio of 19.9 per cent. Both ratios are above the Swiss
regulatory minimum requirements of 7.8 per cent for the CET1
capital ratio and 12 per cent for the Tier 1 capital ratio.
The pandemic has hit Vontobel along with other firms. “As a
result of the pandemic, we are experiencing a higher level of
uncertainty among clients. This sentiment, combined with
increasing caution on the part of investors, is likely to
continue over the course of the year,” Staub said.
In addition, known factors such as geopolitical tensions and low
interest rates remain a source of uncertainty. “Irrespective of
the market crisis and the difficult operating conditions due to
the corona pandemic, we remain committed to our successful
strategy as a focused and globally active investment manager. We
will continue to make targetted investments in growth – and
consequently in employees and technologies – while systematically
managing costs. Our new set-up and the new way of working related
to it will help us to develop investment opportunities that are
tailored to the individual needs of our clients, even in
difficult market conditions,” Staub added.