BCGE Annual Report 2020 2

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BCGE Annual Report 2020 2 ANNUAL REPORT 2020 BCGE Group Consolidated key figures Balance sheet (in CHF millions) 2020 2019 2018 2017 2016 Balance sheet total 27,542 24,919 23,034 22,671 21,393 Advances to clients 17,593 17,025 16,603 15,692 14,973 Client deposits and borrowings 21,375 18,965 18,056 17,981 16,315 Shareholders’ equity 1,716 1,667 1,570 1,472 1,386 Results (in CHF millions) Net profit from interest operations 216 231 247 210 206 Result from commission business and services 116 120 117 107 100 Result from trading activities 30 31 29 30 26 Other ordinary income 5 37 16 19 17 Total operating income 367 420 409 366 349 Operating expenses 237 239 232 223 222 Operating profit (in CHF million) 113 165 161 128 111 Result of the period (in CHF million) 105 97 91 82 79 Assets under management and 31.8 30.4 26.7 26.4 23.1 administration (in CHF billion) Total number of employees • by full-time work units 819.6 780.4 760.6 748.3 737.6 • by people 873 833 811 799 791 Ratios (%) Shareholders, equity / total assets 6.2 6.7 6.8 6.5 6.5 Market capitalisation to equity 66.7 84.0 88.1 80.2 77.3 Operating profit to equity 6.7 10.1 10.5 8.9 8.1 Return on Equity (ROE) 6.2 5.9 5.9 5.6 5.8 Costs / income 64.7 56.9 56.7 60.8 63.4 Capital coverage 16.2 16.1 15.6 15.0 13.2 Figures per share (in CHF) Shareholders’ equity 238 232 218 204 193 Operating result 16 23 22 18 15 Net profit 15 13 13 11 11 Dividend per CHF 50 share 3.75* 3.75 3.4 2.9 2.8 Stock market data (parent company) High and low share prices (in CHF) • high 204 206 198 166 149 • low 155 192 162 148 129 • close 159 195 192 164 149 Market capitalisation (in CHF million at 31 December) 1,145 1,400 1,382 1,180 1,072 Number of shares in thousands (historic information) 7,200 7,200 7,200 7,200 5,721 Book equity / number of shares 242 234 221 207 195 * Proposal submitted to the Annual General Meeting on 29.04.2021. Overview Inside cover BCGE Group key consolidated figures 1 3 Key points 2020: performance indicators Messages 4 Message from the Chairman 2020, against a backdrop of resilience 6 Message from the Chief Executive Officer A stress test successfully passed Presentation of the BCGE Group 8 Portrait 10 Strategy 12 Organisation 14 Business model 16 Geographical organisation 18 The BCGE share 20 Services 21 Digital banking 22 Risk control 24 Values and expertise / Shared convictions 28 Ethical and Environmental Responsibility Policy (EERP) Shareholder information, 47 corporate governance Comments on 70 the Group financial statements Consolidated financial statements 2020 75 and notes, BCGE Group Annual financial statements 2020 113 and notes, parent company 138 Proposed allocation of profit Inside back cover Contact details Cover and following photos Sebastianna Scilipoti, Switzerland’s 2020 Junior International Tennis Federation number one player. BCGE’s new sports ambassador since 1 January 2021 (see the other sportspeople sponsored by BCGE on pages 26 and 27 of this report). BCGE Annual Report 2020 2 Editor's note: In this report, for ease of reading and without discriminatory intent, the masculine gender has sometimes been chosen, in accordance with grammatical norms which allows the masculine gender to be used as a neutral value to designate a group of people including both males and females. Key points 2020 Key points 2020 Performance indicators remain high 3 While total income is lower due to the economic downturn and non- recurring elements, the Bank’s competitiveness remains intact. Business volume is increasing with the growth of mortgage lending and assets under management and administration. Changes in the balance sheet and major business areas in CHF billion 8 . 31.8 4 . 1 0 3 5 3 . 7 4 billion . 30 . 7 9 6 6 . 2 2 in assets under 2 4 1 0 7 . 2 4 3 3 25 2 . management and 2 2 2 21 administration 20 0 15 7 4 . 0 . 4 . 2 . 1 1 1 1 1 0 1 1 10 1 3 6 2 . 7 . 6 . 5 5 5 4 5 4 0 2016 2017 2018 2019 2020 Balance Assets under management Mortgage Amounts due sheet and administration loans from client Evolution of shareholders’ equity in CHF million in % 1,800 716 24 , 1,716 667 , 1 1 million 1,600 22 of shareholders’ 319 1,400 , 20 equity 1 1,200 18 16.1 16.2 1,000 966 16 800 14.4 14 705 600 .2 12 1 1 10.8 12.6 400 12.0 10 12.0 9.6 200 9.6 8 0 6 31.12.2005 31.12.2010 31.12.2015 31.12.2019 31.12.2020 Shareholders’ equity Minimum Equity coverage ratio (left-hand scale) standard (equity divided by risk-weighted assets) BCGE Annual Report 2020 Messages Message from the Chairman 2020, against a backdrop of resilience: strategic, organisational and individual 4 Being a member of a Board of Directors today means Exceptional situations call for exceptional measures playing an increasingly demanding and specialised and in 2020, all involved had to demonstrate great role, in a context that is increasingly volatile, powers of adaptation, and recall the fundamental uncertain, complex and ambiguous. It is a different principles of crisis management: prevention/ world, one that presents new challenges and new anticipation, preparation/organisation, reactivity/ expectations not only for company executives and effectiveness. The good news is that BCGE is well directors, but also for boards of directors, who have equipped to deal with this sort of crisis; it’s part of its to demonstrate far-sightedness and resilience, while DNA. For 20 years, the Board of Directors and the remaining focused on the long-term vision of the Executive Board have followed an approach based Prof. Gilbert Probst institution they are committed to. This was never on a targeted growth strategy, careful risk-taking truer than in 2020, an unusual and unprecedented and disciplined management of resources. At the year in so many respects. same time, it has remained open to strategic, organisational and individual opportunities that will Creating value and ensuring the resilience improve the Bank’s overall strength. needed for growth In 2020 again, despite the crisis, BCGE showed how A Board of Directors is, by definition, an organ of strong it is. Its performance indicators remain high. control and supervision; but more than that, as it Business volumes are growing, with a well diversified remains actively involved, in close collaboration with revenue structure; operating expenses are well under the Executive Board, in planning the company’s control. The equity coverage ratio is excellent and direction of travel. It is responsible for thinking the proposed dividend is very attractive. The Group’s clearly and strategically to create value and to development prospects are intact: all its medium-to- guarantee the resilience that is required for growth long-term projects remain in place, such as and business continuity. augmented digitalisation and energy transition. Resilience of the sort that BCGE was able to show in Exemplary commitment to continuity the unique year of 2020, marked by the Covid-19 in client service pandemic crisis, with all its human, economic and financial consequences; consequences that were BCGE is a leading Swiss bank with a diversified critical for everyone, for the Bank, its clients, its staff product range, standing out as a multi-service pillar and the public authorities. These consequences of the regional economy. Based on a core of confirmed the importance and the credibility of a traditional activities, BCGE’s business model has bank like BCGE as a key partner in the regional been regularly updated in order to broaden the skills economy. and services on offer. Value can be created by means of long-term BCGE remains confident and continues orientation. This is achieved with the support of a to expand its business far-sighted Board of Directors and an Executive The wide range of impacts that this crisis had on Board that makes full use of a clear strategy, based different sectors of our national and cantonal on a sophisticated, annually-reviewed planning economies required massive counter-cyclical policies process; but primarily through the exemplary to reduce inequalities, at a time when it was still commitment of the Bank’s teams and units to impossible to gauge the depth and granularity of business continuity for all its clients: private the effects of the recession. Nonetheless, BCGE individuals, entrepreneurs and investors. continues to be confident, pursuing its business A cantonal bank provides a service essential to expansion by relying on its diverse expertise and individuals, families and companies. Thus, at the market segment-orientated business model; a model peak of the crisis, BCGE’s teams were called upon in line with the demands of the economies of to serve on the front line, with each person quite Geneva and Switzerland (see the organisation chart naturally putting in an extraordinary effort on site in as of 1 March 2021 on page 12 of this report), a variety of roles. They needed to be fully operational while remaining highly flexible and innovative. in a degraded health environment, adhering to federal government rulings while providing personal and effective client service. Messages In a challenging context that demanded even more 5 foresight and creativity than usual from every “The BCGE Group’s colleague, they were all agents of change.
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