EFG’s revenue-generating Assets under Management1 decreased to CHF 166.7 billion at end-March 2022 from CHF 172.0 billion at end-2021. The decline in Assets under Management in the first three months of 2022 was driven by negative market performance of CHF 6.9 billion due to the challenging market environment, partially offset by positive net new asset inflows and foreign exchange.
In terms of net new asset development, the war in Ukraine and volatile markets led to deleveraging and de-risking by clients across most regions, impacting the net asset inflows in late February and March. Net new asset growth normalised in April. On a year-to-date basis, annualised net new asset growth exceeded 2%, while excluding the deleveraging effect, the annualised net new asset growth rate exceeded 4%.
EFG achieved a solid operating result in the first three months of 2022, with operating revenues at similar levels to the prior-year period. Revenue generation in the first three months of 2022 was marked by uncertain and volatile markets, which led to lower client trading activity that affected brokerage income, while rising interest rates have only just started to provide tailwinds in terms of net interest income. At the same time, EFG has maintained its disciplined approach to costs and has started to benefit from the streamlining of its footprint and other cost management actions completed in 2021.
EFG has no presence in Russia, Belarus or Ukraine. Its direct exposure to Russian issuers, and its related counterparty risk and credit risk are marginal. Assets under Management from Russian nationals domiciled in Russia account for approximately 2% of EFG’s total Assets under Management. EFG is not accepting any new business from Russian clients domiciled in Russia. Russian securities held in EFG’s discretionary products account for less than 0.1% of total Assets under Management.
EFG’s capital and liquidity position remains strong. At today’s Annual General Meeting of EFG International, EFG shareholders will vote on the approval of the distribution of a dividend of CHF 0.36 per registered share (exempt from Swiss withholding tax). In light of its strong capital position and to reduce the dilution of existing shareholders, EFG’s Board of Directors has decided to repurchase up to 2.8 million EFG shares. The repurchase will be effected through open market purchases executed in a market-sensitive manner by a third party over a pre-defined period of time. This planned repurchase of shares has the sole purpose of funding employee incentive plans.
Giorgio Pradelli, CEO of EFG International: “Following the recovery that we have seen in April, both in terms of net asset inflows and client trading activity, EFG is well positioned to continue on its profitable and sustainable growth path. Twelve consecutive quarters of net new assets show that we stayed close to our clients in this challenging environment as a trusted partner, offering expert advice and comprehensive services.”
Nomination for the Board of Directors
EFG International AG has been informed that Dr. Spiro J. Latsis intends to sell approximately 3.6% of EFG International shares to Mr. Boris Collardi who is being proposed as a new non-independent member of the Board of Directors of EFG International AG.
The Board of Directors of EFG International intends to convene an extraordinary shareholders meeting of EFG International AG to elect Mr. Collardi in the coming months once all regulatory filings and approvals have been completed.
1 Alternative performance measures and Reconciliations: This media release and other communications to investors contain certain financial measures of historical and future performance and financial position that are not defined or specified by IFRS, such as "net new assets", "Assets under Management", "operating profit", "underlying net profit", "cost/income ratio", “Liquidity Coverage Ratio”, “Loan/Deposit Ratio”. These alternative performance measures (APM) should be regarded as complementary information to, and not as a substitute for the IFRS performance measures. The definitions of APM used in this media release and other communications to investors, together with reconciliations to the most directly reconcilable IFRS line items, are provided in the section headed "Alternative performance measures" of the 2021 Annual Report available at efginternational.com/ch/investors/financial-results.html
This document has been prepared by EFG International AG (“EFG”) solely for use by you for general information only and does not contain and is not to be taken as containing any securities advice, recommendation, offer or invitation to subscribe for, purchase or redeem any securities regarding EFG.
This media release includes forward-looking statements that reflect EFG’s intentions, beliefs or current expectations and projections about EFG’s future results of operations, financial condition, liquidity, performance, prospects, strategies, opportunities and the industries in which it operates. Forward-looking statements involve all matters that are not historical facts. EFG has tried to identify those forward-looking statements by using the words ‘may’, ‘will’, ‘would’, ‘should’, ‘expect’, ‘intend’, ‘estimate’, ‘anticipate’, ‘project’, ‘believe’, ‘seek’, ‘plan’, ‘predict’, ‘continue’ and similar expressions. Such statements are made on the basis of assumptions and expectations which, although EFG believes them to be reasonable at this time, may prove to be erroneous.
These forward-looking statements are subject to risks, uncertainties and assumptions and other factors that could cause EFG’s actual results of operations, financial condition, liquidity, performance, prospects or opportunities, as well as those of the markets it serves or intends to serve, to differ materially from those expressed in, or suggested by, these forward-looking statements. Important factors that could cause those differences include, but are not limited to: changing business or other market conditions, legislative, fiscal and regulatory developments, general economic conditions in Switzerland, the European Union and elsewhere, and EFG’s ability to respond to trends in the financial services industry. Additional factors could cause actual results, performance or achievements to differ materially. In view of these uncertainties, readers are cautioned not to place undue reliance on these forward-looking statements. EFG and its subsidiaries, and their directors, officers, employees and advisors expressly disclaim any obligation or undertaking to release any update of or revisions to any forward-looking statements in this media release and any change in EFG’s expectations or any change in events, conditions or circumstances on which these forward-looking statements are based, except as required by applicable law or regulation.