Vontobel Holding Ag · SIX:VONN
Vontobel — H1 2016 Earnings Presentation
55 slides from Vontobel's earnings presentation, Jul 26, 2016
Slide 1: Vontobel half-year results 2016
Vontobel half-year results 2016 Zeno Staub, CEO Martin Sieg Castagnola, CFO 26 July 2016 Performance creates trust
Slide 2: Cautionary statement regarding forward-looking statements and disclaimer
Vontobel half-year results 2016 26 July 2016 Cautionary statement regarding forward-looking statements and disclaimer 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.
Slide 3: Overview
Vontobel half-year results 2016 26 July 2016 Overview Highlights Half-year results 2016 Strategy update Outlook 3
Slide 4: Net profit and earnings per share increase in challenging environment
Vontobel half-year results 2016 26 July 2016 Vontobel delivers an increase in net profit and earnings per share in challenging environment Key figures Group net profit +8.1% Earnings per share +6.3% CHF 105.7 mn CHF 1.87 Total client -4.2%1 Net new money excl. 7.0%2 Client assets of assets Quality G
Slide 5: Client-driven business model proves resilient
Vontobel half-year results 2016 26 July 2016 Vontobel’s client-driven business model with a focus on wealth and asset management proves resilient in challenging environment Clients continue to endorse our services and products - Impressive annualized NNM growth of 7.0% in wealth and asset management
Slide 6: Overview
Vontobel half-year results 2016 26 July 2016 Overview Highlights Half-year results 2016 Strategy update Outlook 6
Slide 7: Advised client assets remain high at CHF 140 billion
Vontobel half-year results 2016 26 July 2016 Advised client assets remain high at CHF 140 billion – 95% stem from clients in target markets Advised client assets (CHF bn, end of period) Advised client assets by client domicile (mid-2016) Others Italy 148 Switzerland 140 Germany 5% 137 6 5% 7 6 6 6 1
Slide 8: Wealth Management net new money growth of 4.8%
Vontobel half-year results 2016 26 July 2016 Wealth Management achieves annualized net new money growth of 4.8% – in upper end of target range of 3-5% Net new money1 (CHF bn) Development of AuM (CHF bn) Gross margin on AuM (bps) 5.9% 5.3% 7.2% 4.8% 5.7% 4.8% ∆ in %2 1.2 77 76 76 1.1 31-12-15 41.6 73
Slide 9: Asset Management improved CIR, margin of 46 bps
Vontobel half-year results 2016 26 July 2016 Increased operating leverage in Asset Management leads to improved CIR – ongoing diversification across boutiques results in margin of 46 bps Net new money1 (CHF bn) Development of AuM (CHF bn) Gross margin on AuM (bps) 2 7.4% 9.0% 24.7% -3.0% 13.4% 4.4%
Slide 10: Financial Products expands in Europe, volumes on deritrade MIP
Vontobel half-year results 2016 26 July 2016 Financial Products continues expansion in Europe and reports significant increase in volumes traded on deritrade® MIP Notional volume issued on Turnover in listed and non-listed Vontobel products1 (CHF bn) deritrade® MIP (CHF bn) +44% Overall challenging
Slide 11: Net profit of CHF 105.7 million, up 8%
Vontobel half-year results 2016 26 July 2016 Vontobel delivers net profit of CHF 105.7 million in challenging environment – an increase of 8% compared to 1H15 Breakdown of net profit Comparison of net profit with 1H16 (CHF mn) previous year (CHF mn) Comments Operating income proved resilient in toug
Slide 12: Strong growth with stable risk-weighted assets
Vontobel half-year results 2016 26 July 2016 Vontobel generates strong growth with stable risk-weighted assets – reflecting our successful focus on capital-light business models Operating income and risk-weighted assets (CHF mn) 4% 19% 508 497 450 437 5,313 5,169 5,348 417 5,153 5,065 5,127 390 1H11
Slide 13: Cost/income ratio improves to 72.9%, return on equity 14.4%
Vontobel half-year results 2016 26 July 2016 Vontobel improves cost/income ratio to 72.9% and increases return on equity to 14.4%, significantly exceeding cost of capital Development of key figures Comments 30-06-15 30-06-16 ∆ Operating income declined by 2% due to lower asset base and lower client
Slide 14: Wealth & Asset Management increases profit contribution
Vontobel half-year results 2016 26 July 2016 Wealth & Asset Management increases profit contribution – Financial Products delivers robust result in tough environment Pre-tax profit of core activities and Corporate Center (IFRS, CHF mn) Wealth Management1 Asset Management Financial Products Corporate
Slide 15: Capital position remains strong
Vontobel half-year results 2016 26 July 2016 Capital position remains strong and significantly exceeds regulatory requirements – without issuing any AT1 or T2 Vontobel equity (CHF mn; IFRS) Regulatory capital (CHF mn; mid-2016; fully applied) 1,425 977 -14 1,410 0.0% 856 -107 106 >4% 642 4.2% 428 18
Slide 16: Overview
Vontobel half-year results 2016 26 July 2016 Overview Highlights Half-year results 2016 Strategy update Outlook 16
Slide 17: Focused on solidly growing markets
Vontobel half-year results 2016 26 July 2016 Vontobel is focused on solidly growing markets and is delivering value through a distinctive first-class offering Wealth management Active asset management Financial products Strong growth of HNWI population Industry AuM grew by an average of Long-term in
Slide 18: Strategy based on core capabilities, target markets, technology
Vontobel half-year results 2016 26 July 2016 Vontobel’s strategy is based on our core capabilities, target markets and leading technology Our strategy is based on three pillars Core capabilities Target markets Leading technology We protect and build the In addition to our home We deliver Swiss quali
Slide 19: Successfully delivering on strategy
Vontobel half-year results 2016 26 July 2016 Vontobel is successfully delivering on its strategy Core capabilities Strategic priority: service and product excellence Vontobel’s core Service leader Named ‘Best Private Bank in Switzerland’ in 2016 by Swiss business capabilities are: magazine BILANZ fo
Slide 20: Quality Growth boutique retains investment team
Vontobel half-year results 2016 26 July 2016 Quality Growth boutique retains entire team of investment professionals and appoints deputy portfolio manager for each strategy Quality Growth boutique Quality Growth boutique continued has a fully committed team to deliver outperformance this year Qualit
Slide 21: Asset Management diversified book of boutiques
Vontobel half-year results 2016 26 July 2016 Asset Management’s strategy is to run a diversified, institutional-focused and global book of boutiques Diversified book of business (CHF bn) Comments Diversification of book of business improved due to Total advised client assets: CHF 91.8 bn inflows in
Slide 22: Omni-channel offering for Wealth Management clients
Vontobel half-year results 2016 26 July 2016 Vontobel’s omni-channel offering gives Wealth Management clients a coherent and seamless experience, ‘anytime and anywhere’ Vontobel’s omni-channel offering Watch list Contact Ideas/research Trading Tablet Markets Wealth overview Smartphone Desktop B2C B2
Slide 23: Financial Products combines technology, cost leadership, innovation
Vontobel half-year results 2016 26 July 2016 Financial Products combines technology and cost leadership with innovation capabilities to deliver unique services to our clients Continuous expansion in European markets White Labelling 2.0 – a unique solution Financial Products increased market share in
Slide 24: Raiffeisen partnership extended; Vescore acquisition
Vontobel half-year results 2016 26 July 2016 Successful partnership between Raiffeisen and Vontobel extended beyond 2020 – Vontobel to acquire Vescore Expansion of partnership with Raiffeisen Acquisition of Vescore Raiffeisen is a leading Swiss retail bank with 3.7 million clients – almost every In
Slide 25: Overview
Vontobel half-year results 2016 26 July 2016 Overview Highlights Half-year results 2016 Strategy update Outlook 25
Slide 26: Outlook: continue on growth path
Vontobel half-year results 2016 26 July 2016 Outlook: Vontobel to continue on its growth path A growing industry in a First half of year Growth initiatives challenging environment is seasonally stronger to be continued Continued expansion of asset pools Group net profit (CHF mn) Wealth Management: P
Slide 27: On track to meet 2017 targets
Vontobel half-year results 2016 26 July 2016 Successful implementation of growth strategy combined with operating leverage means we are on track to meet 2017 targets Return on equity (in %) Cost/income ratio (in %) Total capital ratio (in %) Payout ratio (in %) < 75 21.3 14.4 79.4 67.7 69.2 13.6 75.
Slide 28: Thank you for your attention
Vontobel half-year results 2016 26 July 2016 Thank you for your attention. Vontobel Investor Relations Gotthardstrasse 43 CH-8022 Zurich +41 58 283 76 97 vontobel.com 28
Slide 29: Appendix
Vontobel half-year results 2016 26 July 2016 Appendix 29
Slide 30: Advised client assets almost doubled since 2008
Vontobel half-year results 2016 26 July 2016 Growth in advised client assets almost doubled since 2008 – confirming Vontobel’s successful focus on its core capabilities Advised client assets (CHF bn, period-end) Vontobel’s business model Vontobel’s core capabilities are to protect and build wealth,
Slide 31: 95% of advised client assets from home and focus markets
Vontobel half-year results 2016 26 July 2016 95% of advised client assets come from home and focus markets Advised client assets by client domicile as of mid-2016 (CHF bn) Home Focus markets Other markets market Emerging Switzerland1 Germany Italy UK US Total Markets2 Advised client assets 58.2 8.9
Slide 32: Advised client assets diversified across asset classes
Vontobel half-year results 2016 26 July 2016 Advised client assets have grown by 13% since 1H14 and are well diversified across asset classes Advised client assets (CHF bn) Advised client assets by asset class (mid-2016) Wealth Management Asset Management +13% 8% 4% 7% 3% 142.2 140.1 22% 7% 6% 124.0
Slide 33: Strong performance culture confirmed by the market
Vontobel half-year results 2016 26 July 2016 Strong performance culture is confirmed by the market We have received 144 awards for our investment funds and investment expertise since 2011 33
Slide 34: Asset Management boutiques focus on defined strategies
Vontobel half-year results 2016 26 July 2016 Vontobel Asset Management boutiques focus on clearly defined investment strategies Assets1 Assets1 Quality Growth Boutique (CHF bn) Fixed Income Boutique (CHF bn) High-quality growth at sensible prices – a single Actively managed fixed income investment i
Slide 35: Expansion of partnership with Raiffeisen
Vontobel half-year results 2016 26 July 2016 Expansion of partnership with Raiffeisen based on Vontobel’s compelling asset management offering for financial institutions Vontobel’s offering for asset management partners Partners across the globe rely on Vontobel’s offering Distinctive offering for f
Slide 36: Vescore complements product offering
Vontobel half-year results 2016 26 July 2016 Vescore ideally complements Vontobel Asset Management’s product offering Combined product offering Good cultural fit Sustainable Investing and Quantitative Investing strategies complement existing product offering Vontobel Asset Management’s multi- boutiq
Slide 37: Financial Products business model
Vontobel half-year results 2016 26 July 2016 Vontobel Financial Products provides investment content and bespoke structured products through a well balanced business model Capital markets Vontobel’s derivatives factory Distribution Risk - Exchanges Investment Content advisory - OTC - Interbank marke
Slide 38: Financial Products leverages technology and cost structure in Europe
Vontobel half-year results 2016 26 July 2016 Financial Products leverages technology and cost structure to gain market share in Europe Technology leadership Leverage products in Europe Leading technology platform enables Vontobel Volume in Volume VT market Vontobel to rapidly enter new markets and t
Slide 39: Financial Products market share across markets
Vontobel half-year results 2016 26 July 2016 Financial Products with stable or growing market share across all markets Switzerland (CHF bn) Germany (EUR bn) Rank Market share turnover Market share # of trades Rank Market share turnover Market share # of trades #2 27.1% 49.8% #5 6.5% 8.9% 8.0 60% 8.0
Slide 40: Distribution strategy for Financial Products
Vontobel half-year results 2016 26 July 2016 Distribution strategy for Financial Products geared towards high-growth areas Derivatives market Exchange (SIX Structured Products, Börse Frankfurt, Euwax, NGM, Sedex) Primary market Secondary market Issuance Fixing/listing Private placements Expiry Excha
Slide 41: deritrade Multi-Issuer Platform setting new standard
Vontobel half-year results 2016 26 July 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 Ba
Slide 42: deritrade MIP decision-making tool for structured products
Vontobel half-year results 2016 26 July 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
Slide 43: deritrade SmartGuide
Vontobel half-year results 2016 26 July 2016 deritrade® SmartGuide The intelligent decision-making tool The new standard of tomorrow … …is already operating in today’s world Technology that transforms big data into smart data. Technological analysis intelligence with direct access to the vast amount
Slide 44: Structuring Platform for platform partners
Vontobel half-year results 2016 26 July 2016 Platform partners benefit from our best execution for all product components and our large distribution network Open architecture as a mission statement Value propositions 14 Option Best execution for all product components Provider - Including the option
Slide 45: deritrade Multi-Issuer Platform provides products within seconds
Vontobel half-year results 2016 26 July 2016 deritrade® Multi-Issuer Platform provides structured products from multiple issuers within seconds for a given product specification 45
Slide 46: Dedicated strategy for Asia Pacific
Vontobel half-year results 2016 26 July 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: Leverag
Slide 47: All segments with ambitious targets for 2017
Vontobel half-year results 2016 26 July 2016 All segments with ambitious targets for 2017 Private Banking Asset Management Financial Products & EAM NNM growth1 (in %) NNM growth1/3 (in %) Pre-tax ROAC5 (in %, annualized) 13.0 53 36 40 > 25 3-5 3-5 4.5 4.4 5.3 4.44 1H14 1H15 1H16 Target -1.5 1H14 1H1
Slide 48: Active management of capital expenditure
Vontobel half-year results 2016 26 July 2016 Active management of capital expenditure will lead to CIR improvement of about 1 percentage point 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) com
Slide 49: High quality of bond portfolio maintained
Vontobel half-year results 2016 26 July 2016 High quality of bond portfolio maintained Counterparty exposure by rating (mid-2016) Counterparty exposure by sector (mid-2016) 7% 1% 23% 28% 31% 39% 30% 41% AAA AA A BBB Other Government/public sector bodies Financials Corporates (non-financials) Note: T
Slide 50: Financial Products less than one-third of capital usage
Vontobel half-year results 2016 26 July 2016 Financial Products accounts for less than one-third of capital usage Capital consumption as of mid-2016 (CHF mn) 630.6 194.0 202.7 180.7 151.9 33.3 125.8 135.9 79.4 104.0 0.0 5.0 132.31 199.4 67.1 38.3 59.3 34.2 8.9 31.9 92.6 17.6 -2.5 Wealth Asset Financ
Slide 51: Disciplined M&A approach
Vontobel half-year results 2016 26 July 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 acq
Slide 52: Attractive value proposition for investors
Vontobel half-year results 2016 26 July 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 growi
Slide 53: Strategy delivered attractive returns to shareholders
Vontobel half-year results 2016 26 July 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 return on equity of 11.7% since 21,6% 2003 – which is clearly abo
Slide 54: Additional transparency on wealth management activities
Vontobel half-year results 2016 26 July 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
Slide 55: Strong commitment of Vontobel families
Vontobel half-year results 2016 26 July 2016 Strong commitment of Vontobel families Shareholder structure as of 30 June 2016 1 45.8% Shares in the pooling agreement 13.1% Vontobel families Publicly held 37.7% 14.3% Vontrust family holding Vontobel Foundation and 17.2% Pellegrinus Holding Non-locked