27.1 million francs: Obwaldner Kantonalbank keeps profits steady in 2023

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Business success, the measure of banks’ operational performance, increased by 16.0 percent to 27.1 million francs in the OKB in fiscal 2023. But as the bank announced on Thursday, the end result was a profit of 13.8 million francs; this was just at the previous year’s level.

The main reason for the difference between commercial success and profit is the 4 million francs higher allocation to general banking risks reserves. It was stated that the bank wanted to protect itself against “natural default risks”.

Like last year, 8.67 million francs will flow to the canton as profit distribution and state guarantee compensation. OKB said this was equivalent to about 230 francs per person in Obwalden. The bank also distributes a fixed dividend of 30 francs per certificate of participation to approximately 2,400 shareholders.

Net income in the central interest business fell 4.6 percent to 49.7 million francs. Many other cantonal banks have recently managed to significantly increase their success thanks to the reversal in interest rates. The main reason for the decline was “value adjustments due to default risk and losses from the interest business” amounting to 3.0 million francs. Last year the bank was able to cash out 2.0 million francs here.

Some of the value adjustments may be due to the Signa real estate group facing difficulties. In mid-January, the bank confirmed that it had a claim of 24.3 million francs “against a group of investors in difficulties in the retail and real estate sector”, although the name of the creditor was not clearly stated. There are no comments about the bank yet.

Success in the commission and service business increased from 9.1 million francs to 9.7 million francs. After business here was weak last year, success in the trading business quadrupled to 7.0 million francs.

The bank said it benefited from the normalization of stock market conditions and valuation gains on its securities. Income from foreign exchange and bond trading was also strong. According to the statement, the remaining ordinary income increased from 1.1 million francs to 3.5 million francs.

Operating expenses remained roughly flat at the prior year’s level of 35.6 million. The expense-income ratio was 50.9 percent.

According to the statement, the bank looks forward to the current fiscal year 2024 with confidence. Additionally, the financial institution wants to “continue on its chosen path of sustainable growth while maintaining consistent and forward-thinking cost discipline.” (SDA)

Source :Blick