The promise was made at the time of the presentation of the annual results for 2021: “2022 would be the year of return to operational balance,” Quintet group CFO Nicholas Harvey said at the time.
In 2022, the group’s net revenues reached €524m (+14% compared to 2021) with a net profit of €18.1m compared to a loss of €110m in 2021. This loss was due to exceptional charges resulting from the closure of the group’s Swiss activities, which will have cost €70m altogether.
This growth was supported by the increase in the loan portfolio, which reached €4.9bn (+10%), while at the same time the group’s expenses remained stable at €493.2m (-2%).
The volatility of the markets due to numerous factors of uncertainty--macroeconomic, monetary or geopolitical--will however have weighed on the total assets of its clients, which fell by 10.2% to €86.7bn. “We expect total customer assets to recover as markets stabilise,” said Chris Allen, Quintet group CEO. The positive results for 2022 are due to good cost management, the recovery of the markets in the second half of the year, which benefited the private banking and asset servicing activities, and the rise in rates, he stated. “We intend to capitalise on the momentum gained to grow over the next five years.”
Ratios to cope with crises
In the face of market volatility, the bank has adjusted its risk exposure and relies on the strength of its balance sheet. “With our balance sheet, we are well positioned in the current environment,” said Allen.
The Basel III core capital ratio (CET1) stood at 18.4% at the end of 2022, “up from 18% at the end of the previous year.” The bank’s liquidity coverage ratio (LCR) stood at 153.2% at the end of 2022, up from 138.5% at the end of 2021. These ratios protect the bank from an SVB or Credit Suisse type scenario. Allen said that “the current sources of funding and liquidity remain extremely stable.” And he pointed out that Quintet’s exposure to the fallen Swiss bank is “virtually zero.”
2023 is looking good. The key figures for the first quarter are on a par with those of 2022. “And with the implementation of our new strategic plan, we will become even better.” The plan was announced last February with the objective :to achieve additional economies of scale, reduce our organisational complexity and increase collaboration to better serve our customers.” The concrete details of this plan--and its impact on employment--are still being finalised. Allen stated that “we also intend to invest more in the bank this year, including in areas such as customer experience, employee training and digitalisation. Taken together, these measures will lead to improved productivity, increased revenues and reduced costs.”
Read the original French version of this article on the Paperjam site