Berner Kantonalbank (BEKN) H2 2023 earnings summary

Executive summary

• FY2023 net profit rose 9.6% YoY to CHF 174.9m; operating business success reached CHF 246.9m, up 40.4% YoY.

• Customer assets increased 4.6% to CHF 40.8bn, while customer loans grew 4.1%; strategy execution and customer growth supported the result.

Financial highlights

• Business income rose 9.6% to CHF 532.3m; operating expenses edged down 0.2% to CHF 254.4m despite inflation.

• Net interest income increased 19.4% to CHF 376.5m; commission and service income fell 3.7% to CHF 104.9m, and trading income declined 35.2% to CHF 24.3m.

• Reported business success was CHF 238.9m; adjusted for non-operating items, operating business success was CHF 246.9m versus CHF 175.9m in 2022.

• Net profit was CHF 174.9m versus CHF 159.6m; basic EPS was CHF 18.8 versus CHF 17.1 in 2022.

Outlook and guidance

• Outlook for 2024 remained confident, with expectations for another strong result.

• Long-term fixed mortgage rates were expected to rise moderately from late-2023 levels; SARON mortgage rates were expected to remain near current levels.

• The 2021–2025 free-cash-flow target is CHF 450–550m; cumulative FCF reached CHF 428.7m after three years, including CHF 211.8m in 2023.