Swiss lender EFG posts strong inflows after takeover talks stalled (updated)

EFG International AG

28/05/2024 07:13

(Adds CEO comments and details from paragraph 4 onward)
    By Noele  Illien
       ZURICH, May 28 (Reuters) - EFG International  EFGN.S  on
Tuesday reported a 7.6% rise in client inflows for the first
four months of the year, beating its own target, after takeover
talks with larger Swiss competitor Julius Baer  BAER.S  stalled.
    The lender, which has hired extensively from Credit Suisse
in the wake of the bank's collapse, said inflows reached 3.6
billion Swiss francs ($3.95 billion) for the period.
        That topped a forecast from Vontobel analyst Andreas
Venditti who had expected 2.5 billion francs of inflows for the
four-month period.
        "We have achieved a promising start to the year with
strong financial performance and increased client momentum,
resulting in a significant acceleration of net asset inflows,"
Chief Executive Giorgio Pradelli said in a statement.
        EFG reported net profit of 110 million francs for the
period but did not provide the corresponding profit a year
earlier, as it previously reported on a quarterly basis. For the
full year last year, it reported net profit of 303.2 million
francs.
        The update for January through April, provided for the
first time, puts its calendar in sync with Julius Baer, which
reported inflows of 1 billion Swiss francs for the same period.
        Baer had held talks with EFG about a potential takeover
in recent months, but the discussions have stopped, Reuters
reported last week.
    The two Swiss banks were in talks around the time Julius
Baer ousted its chief executive officer Philipp Rickenbacher in
February, after losses on loans to failed property firm Signa.
        Julius Baer considered EFG's CEO Giorgio Pradelli as a
potential head of a combined entity as part of the takeover
deliberations.
        Strategically, a combination is questionable, RBC
analysts wrote in a note to clients after the media reports.
Baer has been investing and the additional challenge of
integrating EFG would raise questions, the analysts wrote.
    EFG reported its assets under management rose by 11% to
157.5 billion francs from 142.2 billion francs at the end of
2023, more than the 156 billion francs estimated by Venditti.


($1 = 0.9121 Swiss francs)

 (Reporting by Noele Illien; Editing by Jamie Freed and Sonali
Paul)
 ((Noele.Illien@thomsonreuters.com; +41 41 528 39 73;))