Valiant recorded a steady increase in interest income and a robust rise in trading income, which helped to push consolidated net profit for the first nine months of the year up 4.4% to CHF 92.5 million. Operating income increased 4.1% to CHF 329.9 million, and operating profit rose 3.0% to CHF 112.0 million. Valiant also remained on track with the implementation its strategy. The bank’s expansion continued apace, with a new branch office opened in Winterthur in Q3 2022 and more new branches to come. As planned, the programme to increase profitability is also well under way.
On 1 July 2022, Valiant became one of the first Swiss retail banks to stop charging clients negative interest. The bank also responded swiftly to changing market conditions, raising interest rates on savings and pensions accounts in September 2022. "We were ready for these changes. Our clients should benefit from rising interest rates directly and immediately. The bank’s solid business trend shows that our approach was the right one," says Ewald Burgener, Valiant's CEO.
Solid interest income in a turbulent market environment
Net interest income before value adjustments for credit risk rose 1.6% year on year to CHF 259.1 million, further consolidating the bank's strong position in this business. In 9M 2022, value adjustments for credit risk amounted to CHF 9.7 million. As a result, net interest income came in at CHF 249.3 million, up 1.1% on the year-earlier figure.
Stable income from securities trading and investment activities despite a challenging market environment
Fee and commission income increased by 13.8% to CHF 55.1 million. This rise was largely due to a change in the bank’s payment card model, which altered how fees are applied. Despite the highly volatile market environment, commission income from securities trading and investment activities remained stable, at CHF 36.6 million (+0.6%).
Other income and operating expenses
Other operating income was up 3.4% to CHF 10.3 million. Net trading income increased CHF 3.2 million (+26.7%) to CHF 15.2 million, driven mainly by forward foreign-exchange transactions. As planned, operating expenses increased in line with Valiant's expansion, up 6.1% to CHF 202.5 million. Extraordinary income amounted to CHF 1.9 million, primarily due to a property sale.
Growth in loans and funds due to clients
Client loans rose 3.8%, surpassing the CHF 28 billion mark to reach CHF 28.3 billion. As a result, Valiant exceeded its annual 3% growth target already in Q3. Since 2017, 48% of the growth in client loans has come from Valiant’s new branches. Funds due to clients increased by 0.5% to CHF 22.2 billion.
Programme to increase profitability well under way
In early 2022, Valiant added a sixth strategic aim to its Strategy 2024. To achieve the targeted annual savings of CHF 12–15 million from 2024, a series of cost savings and optimisation measures are to be introduced across the company. The programme to increase profitability is moving ahead as planned. At end-September 2022, 17 of the 23 planned branch closures had been completed, and one of the six client areas had been upgraded.
Regional expansion on track
Valiant's expansion from Lake Geneva to Lake Constance is also on track. The bank opened a Winterthur branch in August 2022, its fourth in Zurich Canton; it opened its fifth branch in the canton, in Meilen, at the end of October. In late November, the bank's Uster branch will open its doors. Between 2020 and 2024, Valiant will add 14 branches to its network, creating 170 full-time equivalent positions, including 140 in client advisory services.
New Valiant app
Valiant rolled out a new app in September 2022. Clients are being gradually migrated to the new app, which offers a range of practical functions and an improved interface. It will continue to be upgraded to enable clients to carry out even more banking transactions directly on their smartphones.
Valiant is playing its part in reducing energy use
Valiant attaches great importance to sustainability and seeks to ensure that it purchases energy-efficient electrical products where possible. In addition to raising employees’ awareness of this issue, the bank has, among other things, lowered the room temperature in its buildings, begun switching all building lights off whenever possible, and limited the use of advertising screens in branch windows.
Stable business trend expected
Valiant has a solid capital and liquidity base and a robust business model. 2022 full-year net profit is expected to be slightly above the prior-year figure.
Key balance sheet figures
in CHF millions
in CHF millions
|Total assets||35 913||35 560||1,0|
- of which mortgage loans
|Funds due to clients||22 248||22 139||0,5|
|Headcount (FTEs)||994,6||994,7||-0,1 FTE|
Key income statement figures
in CHF thousands
in CHF thousands
|Net interest income before value|
adjustments for credit risk, and loan losses
|259 058||254 911||1,6|
|Net fee and commission income||55 085||48 387||13,8|
|Net trading income||15 225||12 018||26,7|
|Other operating income||10 256||9 916||3,4|
|Operating income||329 894||316 945||4,1|
|Operating expenses||202 453||190 845||6,1|
|Operating profit||111 954||108 677||3,0|
|Consolidated net profit||92 478||88 565||4,4|
Documents and information on the 9M results are available at: valiant.ch/results.
Images can be downloaded here: valiant.ch/downloads.