Credit Suisse's Wealth Businesses Log Net New Assets Of $28.4 Billion In 2016

Tom Burroughes

14 February 2017

The international and Asia-Pacific wealth management arms of delivered strong performance in terms of asset growth and other measures in the final three months of 2016 and for much of last year, while the newly-formed Swiss universal bank arm saw some outflows.

Across all wealth management territorities and segments, the banking group reported net new assets of SFr28.5 billion ($28.4 billion) in 2016, with assets under management rising 8 per cent to stand at SFr734 billion at the end of last year, a record.

The Zurich-listed group said that at its Swiss universal bank arm, there were net asset outflows of SFr3.5 billion in the fourth quarter compared to outflows of SFR2.9 billion in the same quarter a year before, which the bank said were partly caused by its "proactive measures to continuously improve our EAM network, leading to selected EAM exits".

For the whole of 2016, the Swiss arm logged asset inflows of SFr2.1 billion. These were offset by further outflows connected to EAM exits and regularisation measures of SFR3.8 billion. Total assets under management were SFr249.2 billion, up 1 per cent from the level at the end of 2015, it said in a statement today.

Credit Suisse said its international wealth management business logged a 9 per cent rise in adjusted pre-tax income to SFr1.109 billion in 2016, a rise in net revenues, and record net new money in wealth management. For the full year, total operating costs were steady.

AuM increased at the IWM business by 12 per cent year-on-year to SFr323.2 billion in 2016, driven by net new assets of SFr15.6 billion across emerging markets and Europe at a growth rate of 5 per cent, or 7 per cent before regularisation outflows of SFr5.7 billion. Wealth management grew its assets under management and the adjusted gross margin, with the latter rising 3 basis points to 110 basis points in 2016.

Asia-Pacific
Credit Suisse said its Asia wealth management and connected activities logged a pro-forma pre-tax income gain of 65 per cent in 2016.

Wealth management generated record net revenues and record average AuM of SFr171.6 billion in the fourth quarter of last year, reflecting inflows of SFR14.6 billion for the whole of last year and annualised net new asset growth rate of 10 per cent. Net new assets were positive during the final three months of 2016 at SFr700 million.

The Asian wealth business achieved adjusted pre-tax income of SFr122 million in the fourth quarter of 2016 and SFr778 million in 2016.

"Our wealth management and connected activities have had a very strong year and a very strong final quarter of 2016. Our focus on ultra-high net worth individuals and entrepreneurs has allowed us to grow both assets and margins in a challenging environment," the bank said.