Banque Cantonale Vaudoise (BCVN) H1 2024 earnings summary

Executive summary

• H1 2024 net profit reached CHF 221m, down 8% year-over-year but the second-best H1 in company history, supported by a resilient Swiss and Vaud economy and strong mortgage growth.

• Revenues remained stable at CHF 581m, with mortgage lending up 5% to CHF 33.3bn and customer deposits up 1% to CHF 36.7bn.

• Operating profit declined 6% to CHF 258m, mainly due to higher personnel costs from IT, cybersecurity, and asset management projects.

• Strategy remains focused on sustainable growth, low risk, and strong local presence in the Canton of Vaud.

• Dividend payout of CHF 4.30 per share in May, totaling CHF 370m, with a yield of 4.0% based on 2023 closing price.

Financial highlights

• Net interest income held steady at CHF 290m, as business volume growth offset a less favorable interest-rate environment.

• Fee and commission income rose 7% to CHF 181m, while net trading income fell 15% to CHF 89m.

• Operating expenses increased 5% to CHF 283m, with personnel costs up 7% to CHF 194m, partly due to IT insourcing and one-off pension funding costs.

• Total assets grew 3% to CHF 60.5bn; assets under management rose 4% to CHF 117.2bn.

• ROE for H1 2024 was 11.5%, among the highest in the peer group.

Outlook and guidance

• FY 2024 results are expected to be lower than the record 2023 numbers, in line with previous guidance.

• Business activity is projected to remain steady if macroeconomic and financial market conditions do not change significantly.

• Mortgage growth projected to level off slightly, with annualized growth between 7–10%.

• Net interest income expected to remain solid in H2 2024, but significant growth is not anticipated.

• 2024 growth expected to mirror 2023 at 1.2–1.3%, with a more positive outlook for 2025.