Vontobel Holding Ag · SIX:VONN
Vontobel — FY2015 Earnings Presentation
55 slides from Vontobel's earnings presentation, Feb 11, 2016
Slide 1: Vontobel full-year results 2015
Vontobel full-year results 2015 Zeno Staub, CEO Martin Sieg Castagnola, CFO 11 February 2016 Performance creates trust
Slide 2: Cautionary statement regarding forward-looking statements
11 February 2016 Cautionary statement regarding forward-looking statements This document may contain projections or other forward-looking statements related to Vontobel that are subject to known and unknown risks, uncertainties and other important factors. These projections and forward-looking state
Slide 3: Overview
11 February 2016 Overview Highlights Full-year results 2015 Strategy update Outlook Slide 3
Slide 4: Key figures: growth in earnings per share of 43%
11 February 2016 Growth in earnings per share of 43% driven by strong revenues, operating leverage and active capital management Key figures Net new money 6.5%1 Advised client assets +8.0% CHF 8.0 bn CHF 147.8 bn Group net profit +34% Earnings per share +43% Return on equity +3.7pp CHF 180.1 mn CHF
Slide 5: Vontobel's commitment to clients, talent and technology
11 February 2016 Vontobel’s commitment to clients, talent and technology and our clear focus are driving the business forward Clients continue to endorse our services and products - Impressive net new money growth of 7.9% in wealth and asset management - Strengthening of position in German market fo
Slide 6: Overview
11 February 2016 Overview Highlights Full-year results 2015 Strategy update Outlook Slide 6
Slide 7: Advised client assets reach new record high
11 February 2016 Advised client assets reach new record high despite FX headwinds – proportion of assets from focus markets increases to 95% Advised client assets (CHF bn, year-end) Advised client assets by client domicile (end-2015) Others +40.1 from NNM Italy +8.1 from M&A Switzerland 148 Germany
Slide 8: Significant position across all focus markets
11 February 2016 Significant position across all focus markets – assets in the UK more than treble Switzerland (CHF bn) Emerging Markets (CHF bn) US (CHF bn) 57 57 26 26 28 29 52 +10% 23 +26% 19 +40% 2013 2014 2015 2013 2014 2015 2013 2014 2015 Germany (CHF bn) Italy (CHF bn) UK (CHF bn) 9.1 8.9 7.3
Slide 9: Strong net new money growth of 6.5%
11 February 2016 Strong net new money growth of 6.5% with greater diversification – negative impact from FX headwinds Net new money (CHF bn) Development of AuM (CHF bn) 2011 2012 2013 2014 2015 1 1 1 1 1 10.4% 10.5% 9.2% 5.7% 6.5% ∆ in % 8.2 8.6 9.1 6.2 8.0 End-2014 123.8 1.9 2.6 1.7 6 Acquisitions
Slide 10: Acquisitions in 2015 contributed to Vontobel's growth
11 February 2016 Acquisitions in 2015 contributed to Vontobel’s growth and provided additional expertise as well as scale in home and focus markets Growth of TwentyFour exceeded Integration of Finter Bank successfully Vontobel’s expectations completed in three months TwentyFour delivered strong inve
Slide 11: Financial Products gains a strong position in Europe
11 February 2016 Financial Products gains a strong position in Europe and reports marked increase in volumes traded on deritrade® MIP Listed products1 in Europe deritrade® MIP Turnover on exchange1 (EUR bn) Notional volume issued (CHF bn) Exchange traded volume 136.1 in Europe grew by 17% 2.2 116.4
Slide 12: Operating income grew by 12%
11 February 2016 Operating income grew by 12% – higher asset base led to an increase in fee and commission income Development of operating income (CHF mn) Comments Operating income resilient to FX headwinds and negative interest rates +12% 71% of operating income comprised fee and ∆ to 2014 988.6 ab
Slide 13: Strong growth with stable risk-weighted assets
11 February 2016 Strong growth was generated with stable risk-weighted assets – reflecting Vontobel’s successful focus on capital-light business models Operating income and risk-weighted assets (CHF mn) +0.7% 29.1% 989 884 849 5,294 5,236 766 4,969 775 5,019 5,002 2011 2012 2013 2014 2015 Operating
Slide 14: Operating expense rose at a slower rate than operating income
11 February 2016 Operating expense rose at a slower rate than operating income due to operating leverage Development of operating expense (CHF mn) Comments Operating leverage resulted in lower growth of operating expense compared to operating income ∆ to 2014 Higher personnel expense due to increase
Slide 15: Operating leverage led to 34% increase in Group net profit
11 February 2016 Operating leverage led to 34% increase in Group net profit – earnings per share grew by 43% due to active capital management Development of key figures Comments 2014 2015 ∆ Profit before taxes grew significantly faster than operating income due to Operating income (CHF mn) 884.4 988
Slide 16: Pre-tax profit of core activities and Corporate Center
11 February 2016 Asset Management and Financial Products achieve strong growth – Wealth Management with resilient top line despite significant headwinds Pre-tax profit of core activities and Corporate Center (IFRS, CHF mn) Wealth Management1 Asset Management Financial Products Corporate Center +28%
Slide 17: Capital position remains strong
11 February 2016 Capital position remains strong and significantly exceeds regulatory requirements – without issuing any AT1 or T2 Shareholders’ equity (CHF mn; IFRS) Regulatory capital (CHF mn; end-2015; fully applied) -77 1,425 1,412 177 895 -87 800 0.0% >4% 600 400 4.2% 17.9% 3.5% >12% 7.8% 4.5%
Slide 18: 'Quand même' – Vontobel remains independent
11 February 2016 ‘Quand même’ – Vontobel remains independent and is committed to entrepreneurial growth Vontobel families own … and are committed to While exercising their interests significantly more than 50% … maintaining a controlling stake under a modern governance Cancellation of 12.5% of own s
Slide 19: Increased asset base at end-January; Emerging Markets products
11 February 2016 Increased asset base at end-January despite decline in equity markets – Emerging Markets products are very well positioned Vontobel’s Emerging Markets strategy Vontobel products are among the advised client assets (CHF bn) of Quality Growth boutique most attractive in the industry C
Slide 20: Overview
11 February 2016 Overview Highlights Full-year results 2015 Strategy update Outlook Slide 20
Slide 21: Vontobel is focused on solidly growing markets
11 February 2016 Vontobel is focused on solidly growing markets – delivering value through a distinctive first-class offering Wealth management Active asset management Financial products Strong growth of HNWI population Industry AuM grew by 6% p.a. over Strong increase in demand in Europe and HNWI w
Slide 22: Vontobel is delivering on its strategy
11 February 2016 Vontobel is delivering on its strategy Core capabilities Strategic priority: service and product excellence Vontobel’s core Service leader Named ‘Best Private Bank in Switzerland’ in 2015 by Swiss capabilities are: business magazine BILANZ for the second consecutive year Protecting
Slide 23: Wealth Management net new money growth of 5.2%
11 February 2016 Wealth Management generated net new money growth of 5.2% over the last three years – clearly exceeding peers Vontobel’s Wealth Management activities Comments Advised client assets (year-end, CHF bn) Net new money growth1 (CHF bn) Strong NNM growth of 5.2% over last three years, exce
Slide 24: Private Banking outperformed its peers
11 February 2016 Private Banking outperformed its peers – reflecting its investments in growth and its outstanding offering Private Banking with higher number of Private Banking’s outstanding offering client advisors and sustained efficiency endorsed in Switzerland and internationally +7% +7% After
Slide 25: Asset Management's diversified book of boutiques
11 February 2016 Asset Management’s strategy to run a diversified, institutional-focused and global book of boutiques results in impressive growth Growing revenues and stable margin (CHF mn) Diversified book of business 454 Impressive inflow of net new money of CHF 7.9 bn in 2015 356 380 is diversif
Slide 26: Asset Management's fixed income offering
11 February 2016 Asset Management’s fixed income offering is well positioned to meet changing client needs and to capture future growth Challenging environment Increasing demand for higher Vontobel provides for fixed income investors yielding and flexible solutions attractive solutions Low or negati
Slide 27: Financial Products leverages technology and cost structure
11 February 2016 Financial Products leverages technology and cost structure to gain market share in Europe Technology leadership Leverage products in Europe Flexible technology platform enables Vontobel Volume in Volume VT market Volume in to rapidly enter new markets and to establish 2015 growth in
Slide 28: deritrade® MIP decision-making tool for structured products
11 February 2016 deritrade® MIP is the world’s first decision-making tool for designing and buying structured products using smart and crowd data Innovation cycles Benefits of Vontobel’s multi-issuer platform deritrade® MIP provides full customization capabilities at best prices – bringing the Inter
Slide 29: Market growth in Asia-Pacific expected to continue
11 February 2016 Market growth in Asia-Pacific expected to continue – Vontobel is ready to capture opportunities resulting from global diversification needs Asia continues to be an Demand for global Vontobel’s niche offering is attractive growth market diversification is increasing attractive to Asi
Slide 30: Overview
11 February 2016 Overview Highlights Full-year results 2015 Strategy update Outlook Slide 30
Slide 31: Outlook: Vontobel to continue on its growth path
11 February 2016 Outlook: Vontobel to continue on its growth path A growing industry in a Vontobel’s assets resilient to Growth initiatives challenging environment turbulent market conditions to be continued Continued expansion of asset pools Advised client assets (CHF bn) Wealth Management: Pursue
Slide 32: Targets for 2017 within reach
11 February 2016 Successful implementation of our growth strategy combined with operating leverage brings targets for 2017 within reach Return on equity (in %) Cost/income ratio (in %) Total capital ratio (in %) Payout ratio (in %) < 75 25.5 12.4 80.8 80.3 67.7 69.2 77.0 > 10 21.31 57.8 > 50 > 163 1
Slide 33: Thank you for your attention.
11 February 2016 Thank you for your attention. Slide 33
Slide 34: Appendix
11 February 2016 Appendix Slide 34
Slide 35: Growth in advised client assets of over 100% since 2008
11 February 2016 Growth in advised client assets of over 100% since 2008 – confirming Vontobel’s successful focus on its core capabilities Advised client assets (CHF bn, year-end) Vontobel’s business model Vontobel’s core capabilities are to protect and build wealth, to manage assets actively and to
Slide 36: 95% of advised client assets stem from home and focus markets
11 February 2016 95% of advised client assets stem from home and focus markets Advised client assets by client domicile as of the end-2015 (CHF bn) Home Focus markets Other markets market Emerging Switzerland1 Germany Italy UK US Total Markets2 Advised client assets 56.6 8.9 7.3 12.5 28.5 26.1 7.9 1
Slide 37: Advised client assets well diversified across asset classes
11 February 2016 Advised client assets have grown by 27% since 2013 and are well diversified across asset classes Advised client assets (CHF bn) Advised client assets by asset class (end-2015) Wealth Management Asset Management +27% 5% 3% 6% 21% 15% 147.8 136.9 6% 8% 20% 116.6 29% 11% 30% 23% 59% 23
Slide 38: Strong performance culture is confirmed by the market
11 February 2016 Strong performance culture is confirmed by the market We have received 128 awards for our investment funds and investment expertise since 2011 128 Slide 38
Slide 39: Vontobel's derivatives factory
11 February 2016 Vontobel’s derivatives factory with well-balanced business model – leverage products and structured products Capital markets Derivatives factory Distribution Risk management Risk management Asset classes B2C - Fixed income - Credit - Equities - Commodities open - FX deritrade© - Alt
Slide 40: Strong position in Swiss home market and growing share in Germany
11 February 2016 Strong position in Swiss home market and growing market share in Germany – impressive entry into rapidly growing Nordics market Switzerland (CHF bn) Rank #2 8.0 60% Market share 6.0 40% 4.0 Turnover 20.5% 20% 2.0 # of trades 45.3% 0.0 0% Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun S
Slide 41: Distribution strategy for Financial Products
11 February 2016 Distribution strategy for Financial Products geared towards high-growth areas Derivatives market Exchange (SIX Structured Products, Börse Frankfurt, Euwax, NGM) Primary market Secondary market Issuance Fixing/listing Private placements Expiry Market description (2015) Vontobel on th
Slide 42: deritrade® Multi-Issuer Platform setting a new standard
11 February 2016 deritrade® Multi-Issuer Platform is setting a new standard, driving rapid growth in demand from issuers and distributors Business model Cornerstones Standard New Issuers Issuer market reach, Increased market reach distribution, Cost reduction low costs Bank/ distributors deritrade®
Slide 43: deritrade® Multi-Issuer Platform provides structured products within seconds
11 February 2016 deritrade® Multi-Issuer Platform provides structured products from multiple issuers within seconds for a given product specification Slide 43
Slide 44: Technology leadership enables next-generation solution
11 February 2016 Technology leadership enables next-generation solution – the multi-issuer platform with smart data-driven user guidance Structured products innovation cycle and associated KPIs Single-issuer Multi-issuer Multi-issuer Manual platform platform with SmartGuide Volume # issuers/ platfor
Slide 45: Dedicated strategy for Asia Pacific
11 February 2016 Vontobel launches dedicated strategy for Asia Pacific to at least double business volume in the region by 2020 Wealth management Asset management Financial products Focus on niche offering based on ability to Take market development to next level: Leverage technology leadership in A
Slide 46: All segments with ambitious targets for 2017
11 February 2016 All segments with ambitious targets for 2017 Private Banking Asset Management Financial Products & EAM NNM growth (in %) NNM growth1 (in %) Pre-tax ROAC3 (in %, annualized) 12.5 43 9.4 35 > 25 3-5 6.9 3-5 27 4.9 3.5 4.1 2013 2014 2015 Target 2013 2014 2015 Target 2013 2014 2015 Targ
Slide 47: Active management of capital expenditure will improve CIR
11 February 2016 Active management of capital expenditure will lead to CIR improvement of 2-3 percentage points by 20211 Development of capital expenditure (CHF mn) includes avaloq 93.9 85.4 Significant investments in IT (renewal of front office systems and avaloq) completed – initial investments in
Slide 48: Conservative balance sheet ratios
11 February 2016 Conservative balance sheet ratios – reflecting high level of client deposits and business with structured products Balance sheet at end-2015 (CHF bn) 17.5 17.6 0.3 Due to banks Cash; accounts with SNB, Liquidity/ first-class counterparties and 7.4 on a collateralized basis Clients c
Slide 49: High quality of bond portfolio maintained
11 February 2016 High quality of bond portfolio maintained Counterparty exposure by rating (end-2015) Counterparty exposure by sector (end-2015) 8% 1% 25% 25% 36% 34% 32% 39% AAA AA A BBB Other Government/public sector bodies Financials Corporates (non-financials) The purpose of the actively managed
Slide 50: Financial Products accounts for less than one-third of capital usage
11 February 2016 Financial Products accounts for less than one-third of capital usage Capital consumption as of end-2015 (CHF mn) 618.3 194.3 218.1 165.0 158.5 33.2 131.7 130.4 88.1 100.5 0.0 4.5 119.31 179.1 59.8 37.7 55.0 32.7 36.2 90.7 7.6 14.2 -1.7 Wealth Asset Financial Corporate Total Manageme
Slide 51: Vontobel continues to pursue disciplined M&A approach
11 February 2016 Vontobel continues to pursue disciplined M&A approach Active participation in industry consolidation to accelerate profitable growth Current capital structure provides substantial resources for both bolt-on and larger acquisitions Maintain disciplined acquisition process when consid
Slide 52: Vontobel represents an attractive value proposition for investors
11 February 2016 Vontobel represents an attractive value proposition for investors … with strong A growth case … financial discipline … … and potential for M&A Wealth and asset management Capital-light business model as a Potential to boost profitability industry is growing globally wealth and asset
Slide 53: Attractive returns to shareholders for more than a decade
11 February 2016 Successful implementation of Vontobel’s strategy delivered attractive returns to shareholders for more than a decade Return on equity and dividends Comments Attractive business with average 21.6% return on equity of 11.5% since 2003 – which is clearly above 19.2% Vontobel’s cost of
Slide 54: Additional transparency on wealth management activities
11 February 2016 Vontobel provides additional transparency on its wealth management activities Financial disclosure Comments Organizational set-up/ Vontobel’s Wealth Management activities consist of Private Core activities Banking (PB) and the business with External Asset IFRS reporting Manager (EAM
Slide 55: Strong commitment of Vontobel families
11 February 2016 Strong commitment of Vontobel families Shareholder structure as of the end-20151 45.8% Shares in the pooling agreement 13.1% Vontobel families Publicly held 37.2% 14.3% Vontrust family holding 17.2% Vontobel Foundation and Pellegrinus Holding Non-locked shares of 17.0% the main shar