EFG International said profit in the second half will be lower than in the first six months of 2015 as troubled markets in emerging economies weighed on its business and low interest rates affected the asset and liability management. The private bank has decided to cut 200 jobs to reduce costs.
Operating income and the revenue margin at EFG International in the four months through October remained below expectations, the company said in a statement on Monday. The weak business at the end of the second quarter continued into the second half and net profit as a result will be lower in the second half than in the first.
«Business performance during the four months July to October continued to be adversely impacted by economic and market uncertainty, with concerns relating to emerging markets having a pronounced impact in September,» EFG said.
Cost Cuts – Reduction of Head Count
The cost review announced in July 2015 resulted in measures including the reduction of the headcount by 200, the closure of «marginal» offices and efficiency improvements. The measures should lead to a cost reduction of 5 percent or 30 million francs with one-off restructuring charges amounting to about 50 percent.
Net new assets in the period from July to October increased 8 percent year-on-year, with a recovery in Asia following the net outflow in the first half. All business regions generated net new assets apart from the Americas. Assets under management increased to 83.4 billion at the end of October from 80.2 billion at the end of June 2015.
The number of client advisers rose to 462 at the end of the reporting period, from 444 at the end of June.
EFG International hopes that a settlement of the U.S. tax dispute will be reached by the end of the year.
