Banks

Banks
Switzerland
Banque de Commerce et de Placements SA
Full Rating Report
Ratings
Key Rating Drivers
Foreign Currency
Long-Term IDR
Short-Term IDR
BBB−
F3
Viability Rating
Support Rating
bbb−
4
Trade Finance Determines Risk Profile: Banque de Commerce et de Placements SA (BCP)
is predominately a trade finance bank facilitating trade flows between developed and emerging
markets (EMs). While Fitch Ratings believes that risk controls are strong, BCP’s trade finance
exposure limits the bank’s Viability Rating (VR) to the ‘bbb’ range.
Sovereign Risk
Foreign-Currency Long-Term IDR AAA
Local-Currency Long-Term IDR
AAA
Outlooks
BCP’s sound track record in avoiding meaningful losses in its core business and ability to
quickly adapt its business model to often volatile and challenging conditions in global trade
finance are supportive of its VR, which is one of the highest among trade finance peers.
Foreign-Currency Long-Term IDR Stable
Sovereign Foreign-Currency
Stable
Long-Term IDR
Sovereign Local-Currency
Stable
Long-Term IDR
Collateralisation Mitigates Concentration Risk: The self-liquidating nature of trade finance
transactions and cash collateral help to mitigate credit and concentration risks. Like its peers,
asset quality is vulnerable to single credit events given BCP’s concentrated credit exposures.
Financial Data
Banque de Commerce et de
Placements SA
Total assets (USDm)
Total assets (CHFm)
Total equity (CHFm)
Fitch core capital
(CHFm)
Loan impairment
charges (CHFm)
Operating profit (CHFm)
Net income (CHFm)
Cost/income ratio (%)
Operating ROAA (%)
Operating ROAE (%)
Fitch core capital/
weighted risks (%)
Tier 1 ratio (%)
Equity/assets (%)
31 Dec
13
31 Dec
12
2,417.8
2,155.5
355.9
355.9
2,351.7
2,155.6
340.8
340.8
11.3
5.8
22.8
15.6
55.07
1.03
6.60
21.20
38.4
30.3
50.00
1.75
11.71
22.26
19.92
16.51
21.80
15.81
Flexible, Scalable Business Model: Changes to trade flows and financial markets in EMs
require BCP to regularly enter new markets or new commodity types. Risks arising from this
are being mitigated by BCP’s prudent approach to expansions and its flexible business model.
Solid Capitalisation, Adequate Funding: BCP’s credit profile benefits from its solid
capitalisation with a Fitch core capital (FCC) ratio of 21% and good leverage, both comparing
well with trade finance banking peers. Concentration risk in BCP’s funding profile is largely
offset by the bank’s short-term, high-quality and largely collateralised asset base. Liquidity is
adequate.
Sound Underlying Profitability: Profitability largely depends on trade finance volumes and
margins and has been sound in recent years. Management is trying to diversify earnings by
improving profitability of the bank’s still modest private banking activities.
While BCP’s performance remained adequate in 2013, profitability suffered from 3% lower
trade finance volumes (to CHF9.1bn in 2013) and a simultaneous shift to lower-margin
commodities such as oil as well as a sizeable non-trade finance-related impairment charge,
accounting for a quarter of pre-impairment profit.
Limited Probability of Support: There is, in Fitch’s view, a limited probability of support from
BCP’s long-standing 31% minority shareholder Yapi ve Kredi Bankasi A.S. (YKB;
BBB/Negative). A ‘4’ Support Rating implies a support-driven IDR in the ‘B’ range. BCP is 69%
owned by the Turkish Karamehmet family and 31% owned by YKB, the latter jointly owned by
Koc Group and UniCredit S.p.A. (UCI; BBB+/Negative).
Related Research
Banque de Commerce et de Placements SA
(June 2014)
Analysts
Christian Kuendig
+44 20 3530 1399
[email protected]
Josep Colomer
+34 93 323 8416
[email protected]
Manuela Banfi
+39 02 879087 202
[email protected]
www.fitchratings.com
Rating Sensitivities
Limited VR Upside: Upside ratings potential is limited in the near term given BCP’s already
high VR in the context of other trade finance banks. The VR could, however, benefit from a
material revenue diversification arising from private banking activities as well as continued
stable performance, sound asset quality and strong capital levels.
Single Credit Event Risk: Downward ratings pressure would most likely arise from a material
operational or reputational loss or further significant deterioration in asset quality. An inability to
adjust its business model to increasing competition in trade finance, eroding margins and
franchise, could also lead to a downgrade. A significant decrease in capital ratios driven by
excessive balance sheet growth would also put downward pressure on the ratings.
23 July 2014
Banks
Operating Environment
Domestic Operating Environment of Limited Importance
Switzerland is rated ‘AAA’/Stable and was last affirmed on 9 May 2014. As a trade finance
bank, Switzerland’s economic environment is of only limited importance for BCP. BCP’s links to
the domestic financial market are (apart from bank and central bank placements) limited: it
does not have a domestic deposit franchise and does not issue in the local debt market.
Indirectly Sensitive to EM Developments
The bank is however sensitive to economic developments in major EMs where the majority of
transactions have links to. It is furthermore sensitive to changes in trade volumes and –
indirectly – changes in commodity prices. Interbank funding is largely from EM banks and it
irregularly places a syndicated loan facility, also largely with EM bank participation.
Based on 2013 documentary credit volumes (CHF9.1bn in total) the following EMs are
particularly relevant for BCP:
Figure 1
BCP – Macro Indicator of Selected Emerging Markets
2013 trade
finance volume
(CHFm)
Egypt
923
Turkey
605
China
309
Saudi Arabia
251
UAE
240
Russia
199
India
180
Mexico
146
Sovereign
rating
B−/Stable
BBB−/Stable
A+/Stable
AA/Stable
AA/Stablea
BBB/Negative
BBB−/Stable
BBB+/Stable
2014
GDP growth
(F) (%)
+3.2
+2.5
+7.3
+3.7
+4.5
+0.8
+5.5
+3.0
2014 GGD/GDP Gov. deficit
2014 (F)
2014 (F)
consumer
(%)
prices (F) (%)
(%)
+8.5
91
-11.4
+8.2
36
-2.5
+2.5
53
-2.1
+3.2
0.5
+7.3
+2.3
2
+1.5
+6.5
12
-0.8
+7.8
64
-6.9
+4.0
42
-3.4
a
Sovereign rating applies to Abu Dhabi
Source: Fitch; F = forecast
Strong Regulatory Framework
The Swiss regulatory framework is developed, in line with the banking system itself, and
legislation and regulation are enforced effectively. BCP is supervised on a consolidated basis
by the banking regulator, the Swiss Financial Market Supervisory Authority (FINMA), and the
Swiss National Bank (SNB). In addition, its Luxembourg branch (largely for fund and treasury
activities) is supervised by the Luxembourg banking regulator, CSSF.
Company Profile
Figure 2
Niche Trade Finance Bank with Ancillary Business Lines
Trade Finance Volumes
2013
2012
2011
2010
2009
2008
2007
0
5
10
15
(CHFbn)
Note: Trade finance volumes correspond
to documentary credit volume. Calculation
of volumes is done on a purchase contract
basis since 2011
Source: BCP
BCP is a Geneva-based bank that specialises in commodity trade finance. BCP has a wellestablished niche franchise in structured commodity finance. It benefits from long-term relations
with numerous bank and commercial counterparties in EMs. Geneva’s status as one of the
world’s leading commodity trading hubs has also proven advantageous.
BCP’s other divisions, correspondent banking and treasury, largely act as support functions to
trade finance while still remaining standalone profit centres. In addition to its liquidity
management function, the treasury department is active in foreign currency and since 2012
increasingly fixed income trading, largely on behalf of customers. It also provides hedging tools
to BCP’s trade finance department. Proprietary trading has been scaled down somewhat since
2011. Correspondent banking has close links with the bank’s trade finance activities and
supports the trade finance department by broadening its funding base and diversifying risks.
BCP has continuously increased the number of relationship banks and now has a network of
more than 1,600 banks, resulting in a significant increase of bank-to-bank business volume.
Related Criteria
Global Financial Institutions Rating Criteria
(January 2014)
Banque de Commerce et de Placements SA
July 2014
2
Banks
BCP operates through two branches, in Luxembourg and Dubai. The Luxembourg branch
focuses on offering wealth management services, whilst the branch in Dubai replicates BCP’s
Swiss business model, albeit on a smaller scale. As part of its strategy of enhancing wealth
management services for its EM customer base, in 2013 BCP obtained authorisation from the
Dubai Financial Services Authority to offer wealth management activities in its Dubai branch.
Management has no immediate plans to open additional branches or representation offices.
Adaptable Business Model; Stable Organisational Structure
BCP’s core business, short-term collateralised (structured) commodity trade finance, is largely
with around 360 firms trading in metals, soft commodities, oil products and other commodities.
The bulk of the trade finance exposure is in the form of commercial and documentary credits
(letters of credit) and is typically linked to specific transactions. While in the past, Turkey, the
Commonwealth of Independent States (CIS) countries, the Middle East and the Gulf region
accounted for the bulk of trade finance volumes, BCP has recently expanded towards Africa,
Latin America and selected East Asian countries.
BCP’s correspondent banking network is a key part of its business model. Apart from being key
trade finance counterparties, correspondent banks – largely from EMs – also often deposit hard
currencies with BCP and represent an important funding source for the bank. BCP’s trade
finance and correspondent banking teams are integrated, ensuring that the bank is able to
adequately assess bank counterparty risk in its trade finance transactions.
BCP’s wealth management division provides asset-management and advisory services for
private clients. Most customers are based in BCP’s traditional markets and are linked to its
trade-finance operations. Uncertainty underlying the operating environment, however, such as
tax treaties, and stricter cross-border rules, have somewhat curbed the planned expansion of
the wealth management segment. Nonetheless, the bank aims to re-establish growth in this
segment. BCP acts as a custodian of Swiss registered funds, which enabled it to launch a
small EM bond fund for its wealth management clients.
Management
Experienced Management Team
BCP has a standard two-tier board structure with a seven member supervisory board (board of
directors) and a management board that is made up of ten members. Five members of the board
of directors are considered independent with one member representing YKB (the current CEO of
YKB) and one member representing the Karamehmet family (Cukurova Group). Turnover at
board of directors’ level is low and all members have relevant financial services experience.
Management turnover is low and departing senior management is usually replaced internally. BCP’s
CEO was formerly CEO of YKB (and was in this capacity a member of BCP’s board of directors).
Adequate Corporate Governance Practices
BCP reports under Swiss GAAP, and as an unlisted bank it is not obliged to report under IFRS.
Under Swiss GAAP, BCP is allowed to transfer a certain amount of its annual profit to the Fund
for General Banking Risks (FGBR), which Fitch considers Fitch core capital (FCC). The total
eligible provisions for the FGBR depend on the amount of customer and bank lending. In 2013,
BCP transferred CHF6.5m to the FGBR. Fitch’s analysis is based on BCP’s profitability before
these allocations, which are classified as extraordinary items in the attached income statement.
Related-party exposures are small. Although YKB’s CEO is one of the two vice-chairmen of
BCP’s board, cooperation with and exposure to YKB and UniCredit, is limited.
Consistent Strategy and Adequate Execution
BCP’s strategy largely focuses on balanced and diversified contribution from core business
segments, whilst minimising credit losses and prudently managing its liquidity position. BCP’s
Banque de Commerce et de Placements SA
July 2014
3
Banks
balance-sheet structure gives it flexibility to adapt to the operating environment as necessary.
Management has proven, for example in 2012, to be able to quickly deleverage BCP’s balance
sheet in order to free up liquidity or preserve asset quality.
Execution of its trade finance strategy has been generally consistent and successful. Credit
and/or operational losses in this business line and in correspondent banking have been
historically low. BCP has suffered credit losses when it veered from trade finance and
correspondent banking and started offering non-core credit products such as working capital in
the early 2000s and more recently purchasing bills of exchange.
BCP’s strategy to diversify its revenue base towards wealth management has been somewhat
less successful; however, this is in part because of the transformation of the Swiss private
banking industry due to significant regulatory and to a lesser extent market changes.
Risk Appetite
Centralised and Well-Established Risk Controls
BCP has a sound centralised credit-approval process. BCP’s trade finance activity is
monitored by a specialised team that has extensive knowledge of trade finance structures and
is assisted by automated data systems. At end-2013, Basell III capital requirements were 89%
related to credit risk, 10% to operational risk and 1% to market risk.
Trade finance transactions are designed to be self-liquidating and are typically secured by
cash, letters of credit or guarantees, supported by relevant insurance policies. Maintaining a
short-term and liquid asset base is a key consideration for BCP’s underwriting standards. At
end-2013, the vast majority of BCP’s bank and customer credit exposure (76% of the bank’s
total balance sheet) matured within 180 days (see Figure 4).
Figure 3
Credit Risk Breakdown
(End-2013)
Interbank assets
O/w
On demand
Term
Discounted letters of credit
Discounted drafts
Customers loans
O/w
Unsecureda overdrafts
Unsecured fixed term loans
Secured overdrafts
Secured fixed term loans
Lombard loans
(%)
43
30
31
37
2
57
72
11
5
10
2
a
Total exposure classified as unsecured if any
part of exposure is unsecured
Source: BCP, Fitch
Management also tries to minimise credit risk by ensuring adequate collateralisation levels. At
end-2013, 35% of bank exposure and 16% of customer exposure were collateralised as per
Basel definitions, which exclude exposures secured by mortgages, by goods located in higherrisk countries and all partially secured exposures. Based on a wider definition of collateral,
management estimates that four-fifths of credit exposures are secured.
BCP also assumes some credit risk in its trading (CHF23m at end-2013) and financial
investment (CHF170m) portfolios, although lower-rated investments are typically in banks and
corporates in markets where BCP has relevant experience.
Good Track Record in Avoiding Operational Losses
BCP is exposed to operational risk through its trade-finance operations, high – albeit declining trading volumes and, to a lesser extent its wealth management activities. The bank has
adequate systems and procedures in place and a sound track record of containing operational
risk. The bank has not suffered any material operational losses to date.
Figure 4
Customer and Bank Exposure by Term and Currency
Bank exposure – total
Customer exposure – total
Bank exposure – USD
Bank exposure – EUR
Bank exposure – CHF
Bank exposure - other
Customer exposure – USD
Customer exposure – EUR
Customer exposure – CHF
Customer exposure - other
<30 days (%) 30-90 days (%) 91-180 days (%)
53
26
12
87
5
7
37
36
15
71
10
11
94
6
0
96
4
0
91
5
4
74
14
6
20
0
79
100
0
0
181 – 360 days
(%)
9
1
12
8
0
0
0
5
0
0

1 year (%)
0
0
0
0
0
0
0
0
0
0
Total (CHFm)
702,298
932,648
437,188
168,663
78,015
18,432
831,013
46,339
37,869
17,427
Source: BCP, Fitch
Banque de Commerce et de Placements SA
July 2014
4
Banks
The bank’s systems provide full details of all trade-finance transactions, enabling the bank to
monitor the risks and related collateral at every stage. Enquiries are made for all significant
deposits and the bank is obliged, in accordance with Swiss regulations, to report any
suspicions of money laundering. BCP has a bankers’ insurance policy against fraud for up to
CHF30m per year (subject to an excess of CHF0.25m per loss).
Market Risk
Market risk is moderate and well controlled. It primarily arises from foreign currency trading in
treasury operations and interest rate mismatches. The bank is active in low-margin FX trading,
where volumes are high for a bank of its size, but adequate control systems appear to be in
place. Moreover, the bank has since 2011 drastically reduced the volume of intraday
(momentum) trading (see Figure 5) and overall annual foreign currency trading volumes have
fallen to CHF205bn in 2013 (from CHF619bn in 2011). In 2013, around 69% of trading volumes
related to FX swaps, and 31% to spot and forwards. BCP has strict restrictions on total open
and FX positions, and limits are monitored daily.
The major portion of the bank’s FX trading is intraday proprietary trading with adequate
intraday, overnight and stop loss limits in place (overall CHF30m intraday limit, lower overnight
limits and CHF100,000 stop-loss limit).
BCP’s balance sheet is broadly matched by interest rate and currency. Net open positions were
below 1% of FCC at end-2013. At that same date, the positive replacement value of BCP’s
derivative position, almost exclusively FX forward contracts, was a marginal 1.3% of FCC.
Interest rate risk is calculated monthly and is reported to FINMA quarterly. Fixed rate assets
(41% of the total) broadly match fixed rate liabilities (36%) and the bank uses interest rate
swaps to further reduce interest rate sensitivity. At end-2013, a 100bp positive shift in interest
rates would have had a manageable CHF7.2m negative impact on equity.
Financial Profile
Asset Quality
At end-2013, BCP’s CHF2.2bn balance sheet was split in CHF702m interbank assets,
CHF933m customer loans, CHF298m cash and central bank placements and CHF190m
financial investments (almost exclusively bonds). Given BCP’s short-term business model,
volume changes in interbank assets and customer loans are not very meaningful. Similarly, the
volume of non-discounted letters of credit (accounted for as contingent liability: CHF701m at
end-2013) changes significantly yoy. As a result, overall trade finance volumes (see Figure 2)
are a better indication of business activity and credit risk appetite.
Figure 6
Asset Quality Indicators
Figure 5
(%)
Growth of gross loans
Impaired loans/gross loans
Reserves for impaired loans/impaired loans
Impaired loans less reserves for impaired loans/Fitch core capital
Loan impairment charges/average gross loans
FX Trading Volumes
2013
2012
2011
2013
16.78
1.35
98.44
0.06
1.30
2012
-0.59
0.21
88.24
0.06
0.73
2011
-17.77
0.07
66.67
0.06
0.02
2010
27.72
0.18
88.89
0.07
-0.13
Source: BCP, Fitch
2010
2009
Short-Term Loan Book
2008
Over 90% of BCP’s loan book (CHF933m at end-2013; see also Figure 3) is directly related to
trade finance with a small and relatively stable balance relating to private banking securities
lending (Lombard lending) and the remainder to syndicated loans (CHF63m at end-2013).
2007
0
200
400
600
800
(CHFbn)
Source: BCP
Banque de Commerce et de Placements SA
July 2014
Reflecting the bank’s niche business model and moderate size, concentration by lending
volume and outstanding loans is considerable. In 2013, BCP’s 25 largest customers accounted
5
Banks
for CHF5.6bn or 62% of the bank’s total trade finance volume. Positively, BCP’s largest
customers revolve yoy which, to some extent, reduces reliance on any single business partner.
Figure 7
Assets By Geography
(%; end-2013)
Switzerland
Europe
Turkey
Middle East
Asia
Rest
By
borrower
domicile
32
27
12
8
11
10
By risk
domicile
55
8
10
5
5
17
Source: BCP, Fitch
Similarly, end-2013 outstanding customer loans were concentrated with the 10 largest loans
accounting for around 33% of the total loan book and 86% of FCC. At the same time, three
loans exceeded 10% of FCC (with the largest accounting for 17% of Fitch core capital).
However, borrower concentration is to some extent offset by the high portion of collateral and
the short-term nature of the portfolio. Net of cash and other Basel III eligible collateral, the ten
largest customer on- and off-balance sheet exposures accounted for 101% of FCC at end2013.
Sizeable Interbank Placements from Trade Finance Activities
Interbank assets (CHF702m at end-2013) are short-term and typically linked to trade finance
operations or short-term money market placements with correspondent banks. At end-2013,
39% of BCP’s 20 largest bank exposures were rated in the ‘BBB’ category, 31% in the ‘BB’
category and a further 31% were unrated or rated ‘B’. Due to the size of many trade finance
transactions, interbank assets tend to be concentrated.
Some Credit Risk in Large Bond Portfolio
Figure 8
Business Volume by
Commodities
Inner circle: End-2012
Outer circle: End-2013
Finished steel products
Soft commodities and oleaginous seeds
Oil products and petrochemicals
Ferro alloys and non ferrous metals
Fertilisers
Other
14%
23%
5%
9%
9% 28%
7%
6%
27%
21%
20%
31%
Source: BCP, Fitch
BCP’s investment portfolio was equivalent to 54% of FCC at end-2013 and is held for liquidity
but also earnings purposes. The average rating was in the low ‘BBB’ range and the average
duration was 2.1 years. Historically, BCP had large positions in Turkish and Russian bank and
corporate debt but has recently shifted part of the portfolio towards better quality assets, hence
improving its Basel III liquidity coverage ratio. At end-2103, 42% of BCP’s bond portfolio related
to Turkish Eurobonds, 8% to Russian Eurobonds, 5% to highly-rated German bonds, 18% to
Luxembourg corporate bonds and 26% to other corporate and bank bonds.
Good Asset Quality in Core Activities
Asset quality in BCP’s core trade finance and corresponding operations remained sound in
2013 and 1Q14. In 2013, BCP reported one new impaired loan from a non-core activity
(discounting of a bill of exchange from a troubled Spanish corporate) which caused its impaired
loans ratio to worsen to 1.2% at end-2013. This exposure has been fully provided for as any
recoveries are uncertain. We understand that non-core lending has now been discontinued so
any incremental asset quality deterioration would be linked to the bank’s core activities.
Earnings and Profitability
Trade Finance Volumes and Commodity Mix Drive Profitability
While BCP’s performance remained adequate in 2013, profitability suffered from 3% lower
trade finance volumes and a simultaneous shift to lower margin commodities such as oil and
petrochemicals as well as a sizeable non-trade finance-related impairment charge, accounting
for a quarter of pre-impairment profit. The bank’s profitability in 2013 was also negatively
affected by the appreciating Swiss franc vis-à-vis the US dollar as 71% of its assets are USDdenominated and the bulk of operating expenses in Swiss franc (BCP hedges its balance sheet
but not its profit and loss for currency fluctuations).
Figure 9
Profitability Indicators
(%)
Net interest income/average earning assets
Non-interest expense/gross revenues
Loans and securities impairment charges/
pre-impairment operating profit
Operating profit/average total assets
Operating profit/risk-weighted assets
Net income/average equity
2013
1.80
55.07
33.14
2012
1.93
50.00
13.12
2011
1.52
52.65
0.51
2010
1.59
47.47
-2.17
1.03
1.36
4.52
1.75
2.51
9.24
1.63
2.42
5.79
2.17
2.86
6.01
Source: BCP, Fitch
Banque de Commerce et de Placements SA
July 2014
6
Banks
In 2013, trade finance and correspondent banking revenue, accounting for around 70% of total
revenue, was 14% lower yoy. Treasury revenue, largely from client-related and proprietary
foreign currency trading, typically accounts for a fifth of revenue and was 14% lower yoy due to
sluggish volumes and management’s decision to exit high volume/low margin “momentum
trading”. BCP’s wealth management division (around 10% of revenue) performed better,
reporting a 4% increase in revenue. Operating expenses were well controlled and fell by 5%
yoy largely as a result of lower discretionary staff expenses.
Profitability in 1Q14 improved moderately but management expects the operating environment
to remain challenging for the remainder of 2014 as higher-margin trade finance volumes (such
as steel products) will remain sluggish. It expects the bank’s return on equity (before allocation
to voluntary reserves) to remain around 9% which is below the long-term trend. Still, BCP’s
profitability continues to compare adequately with that of its trade finance peers.
Pressure on Operating Revenue
Operating revenues in 2013 were markedly lower yoy (down 14%) largely due to 17% lower net
fee income, which stood at 54% of gross revenues. Apart from the drop in transaction volumes,
a shift to lower-margin oil and petrochemical products from more profitable finished steel
products (see Figure 8) was the main driver of the reduction in net fee income. Brokerage fees
from private banking activities improved substantially but remained relatively marginal.
Net interest income (NII), accounting for 45% of gross revenues, proved relatively resilient in
2013 (down 5% yoy) despite the appreciation of the Swiss franc versus the dollar. NII from
trade finance activities (79% of gross interest income) fell by 11% yoy in line with trade finance
volumes. NII from financial investments was broadly unchanged. Interest expense was 8%
lower yoy. BCP’s net interest margin in 2013 was lower yoy (1.80% compared to 1.93%) but
remained broadly in line with its long-term average.
Net trading income was marginal in 2013 as revenue from both securities trading and foreign
currency-related trading income fell substantially.
Well-Controlled Operating Expenses
Reacting to a marked fall in revenue, management cut discretionary staff expenses by 7% yoy
in 2013, which led to 5% lower total operating expenses. Previously implemented cost cutting
measures in order to alleviate some of the pressures arising from the mismatch between
foreign-currency revenues and Swiss franc-denominated costs have proven efficient.
Well-contained costs led to a lower cost/assets ratio of 1.88% in 2013, which compares well
with peers and is adequate given the bank’s staff-intensive business model. BCP’s cost/income
ratio worsened to 55% but remains relatively sound.
Figure 10
Single Non-Core Exposure Leads to Higher LICs in 2013
Key Profitability Metrics
After a decade with negligible loan impairment charges, these increased significantly in 2013 to
1.3% of gross loans due to a single non-trade finance exposure (see Asset Quality above).
Cost/Income Ratio (LHS)
(%)
60
Operating ROAE (LHS)
Net interest margin (RHS)
50
(%)
2.5
2.0
40
1.5
30
1.0
20
0.5
10
0
0.0
2008 2009 2010 2011 2012 2013 1Q14
Source: BCP, Fitch
We expect this CHF11m charge to be a one-off and impairment charges will in Fitch’s view,
remain low in the foreseeable future as non-core activity have been discontinued and the bank
continues to use prudent standards for core business. Coverage was good at around 100%.
Similar to previous years (except for 2012), management allocated a large portion of pre-tax
profits in 2013 to the voluntary fund for general banking risks (CHF6.5m).
Capitalisation and Leverage
Strong Capital Ratios
Capitalisation remains strong relative to its risk profile and peers’. At end-2013, BCP’s Basel III
common equity tier 1 (CET1) ratio stood at 19.9%, moderately lower than 2012 largely due to
Banque de Commerce et de Placements SA
July 2014
7
Banks
higher off-balance sheet trade finance exposure. Its Basel III total capital ratio was virtually
equivalent to CET1 and includes the FGBR, which qualifies as Tier 1 capital.
As a category 5 bank, BCP is required to maintain a minimum capital ratio of 10.5% and a
common equity Tier 1 ratio of 7%. BCP regularly conducts internal stress tests (requested by
FINMA).
We believe that it is necessary for BCP to maintain stronger-than-average capital ratios in light
of the large size of typical trade finance transactions. However, the bank has materially
increased its capital base in absolute terms which means that concentration risk is somewhat
less acute than previously. Internal capital generation benefitted from BCP’s moderate dividend
pay-out ratio (typically 25% of net income; around 50% for 2013). The bank’s dividend pay-out
policy is not expected to change according to management.
Figure 11
Capitalisation and Leverage Indicators
(%)
Fitch core capital/weighted risk
Fitch eligible capital/weighted risks
Tangible common equity/tangible assets
Core tier 1 regulatory capital ratio
Internal capital generation
2013
21.20
21.20
16.51
19.92
4.38
2012
22.26
22.26
15.81
21.80
6.84
2011
19.54
n.a.
13.73
19.20
3.83
2010
16.30
n.a.
11.58
15.89
3.12
Source: BCP, Fitch
BCP under Swiss law is not yet required to calculate its Basel III leverage ratio but given its
solid tangible common equity/ tangible assets ratio (16.5% at end-2013) we believe it will
comfortably meet any leverage ratios that might be imposed in future.
Funding and Liquidity
Adequate Funding Profile
Figure 12
Funding and Liquidity Indicators
(%)
Loans/customer deposits
Interbank assets/interbank liabilities
Customer deposits/total funding (excl. derivatives)
2013
157.98
60.23
33.91
2012
134.41
76.29
34.03
2011
109.32
84.37
38.76
2010
105.45
89.66
42.29
Source: BCP, Fitch
We view BCP’s funding and liquidity profiles as adequate despite its short-term funding
structure. BCP sources the majority of its funding via its relationships with trade finance and
correspondent bank counterparties. Consequently, the bank’s non-equity funding is dominated
by interbank deposits (65% of non-equity funding at end-2013) followed by commercial
customer deposits. Reflecting its role as correspondent bank for a number of EM banks, BCP is
typically a significant net interbank borrower.
Commercial deposits often relate to trade finance operations, either pledged as security or held
to cover on-going charges. At end-2013, the top 10 deposits represented 16% of the total.
Concentration risk is mitigated by the transaction nature of the deposits and by frequent
changes in the composition of BCP’s largest depositors.
Geographically, the bank deposit base continues to be dominated by Europe and Switzerland
(33% of total bank deposits at end-2013), while North America accounts for 18% and the
Middle East and North Africa for 16% each. Concentration in bank deposits is typically high but
largely with long-standing correspondents.
Banque de Commerce et de Placements SA
July 2014
8
Banks
BCP will have to comply with FINMA’s interpretation of the Basel liquidity coverage ratio (LCR)
by 2015. At end-March 2014, BCP’s pro forma LCR stood at 106%. BCP estimates that total
assets requiring funding (letters of credit, loans and bond portfolio) amounted to CHF1.47bn at
end-2013, equivalent to a large 68% of BCP’s balance sheet. This indicates that BCP could
absorb relatively significant funding outflows without the need to dispose of core assets. Fitch’s
basic stress scenario, which assumes an outflow of the top five depositors (both customer and
banks) on day one, shows that BCP’s “excess funding” (CHF468m at end-2013) would fall to
around CHF70m but that the bank would still be in a position to easily fund its core assets.
Figure 13
Bank and Corporate Deposits – Maturity Structure
(CHFm)
Due to banks
Corporate deposits
At sight
604.8
388.7
< 3 months
448.9
122.6
3-12 months
112.3
53.2
12 months
33.8
Total (CHFm)
1,166.0
598.3
Source: BCP, Fitch
BCP’s liquidity position is adequate, supported by the short-term and well-matched nature of
the balance sheet, its significant central bank placements (CHF298m or 17% of corporate and
bank liabilities) and the bank’s bond portfolio of CHF193m (11% of corporate/bank liabilities),
most of which could be used in repo transactions with commercial banks or readily sold. BCP
typically maintains minimum daily excess liquidity amounting to 10% of customer deposits.
Support
Limited Institutional Support Possible
BCP’s institutional Support Rating of ‘4’ is based on support potentially available from YKB.
Initially, shareholder support would be forthcoming from YKB and ultimately from UniCredit.
Given the relative size of BCP and the potentially supporting entities, YKB’s and UniCredit’s
ability to support is unquestioned. The propensity of YKB or UniCredit to support BCP is limited
also due to YKB’s minority stake. BCP operates in a different jurisdiction and there are no
formal support agreements or cross default clauses in place.
The propensity of Switzerland to support BCP is in our view limited given BCP’s small size,
absence of any meaningful domestic retail deposits and the bank’s minor role for the Swiss
financial sector.
Banque de Commerce et de Placements SA
July 2014
9
Banks
Figure 14
Peer Group Comparison
(%)
Total assets (USDm)
Total equity (USDm)
Net interest margin
Cost/income ratio
Pre-imp. op. ROAE
LICs/pre-imp. operating profit
Operating ROAE
Operating ROAA
Impaired loans/gross loans
Impaired loans coverage
Gross impaired assets/gross
interbank assets & customer
loans
Gross impaired assets/gross
interbank assets & customer
loans & off balance sheet
exposure
Loans/deposits
Fitch core capital ratio
Tier 1 ratio
Total capital ratio
Tangible common equity ratio
Net impaired loans/equity
BCP (BBB−/
Stable/bbb−)
2013
2012
2,418
2,352
399
372
1.8
1.9
55.1
55.0
9.9
13.5
33.1
13.1
6.6
11.7
1.0
1.8
Union de
Banques Arabes
et Francaises
(BBB+/Stable/
bbb−)
2013
2012
2,368
3,124
451
427
0.8
0.9
73.3
64.0
4.9
7.7
225.8
26.6
-6.2
5.7
-1.0
0.7
Fimbank Plc
(BB/Stable/bb)
2013
2013
1,236
1,130
149
131
1.6
1.3
90.7
71.1
0.1
8.0
n.m.
13.0
-4.9
7.0
-0.6
0.8
Banca UBAE
(BB/Stable/bb)
2013
2012*
2,401
3,136
288
278
1.3
1.4
71.2
48.2
5.5
14.1
-26.1
-10.0
7.0
15.5
0.7
1.4
British Arab
Commercial
Credit Europe
Bank plc
Bank N.V.
(BB/Stable/bb)
(BB−/Stable/bb−)
2013
2012
2013
2012
3,956
3,442 14,009
12,188
324.1
300
884
856
0.7
0.6
5.1
4.7
53.9
54.9
47.1
52.4
10.5
9.2
49.1
35.2
12.3
20.1
64.9
58.5
9.3
7.3
17.3
14.6
0.8
0.5
1.1
1.1
1.4
98.4
0.8
0.2
88.2
0.1
3.2
43.8
1.0
13.7
97.8
3.7
2.5
145.7
5.2
2.5
127.3
5.5
4.7
138.9
1.8
2.5
126.4
0.9
5.3
75.7
n.a.
10.8
53.6
2.6
6.1
60.8
n.a.
4.9
61.3
n.a.
0.0
0.0
0.5
1.8
3.8
4.0
1.1
0.7
n.a.
1.7
n.a.
n.a.
158.0
134.4
450.3
241.4
100.4
74.8
369.0
117.3
70.6
57.3
115.1
103.5
21.2
19.9
20.0
16.5
0.1
22.3
21.8
22.0
15.8
0.1
22.2
20.5
20.5
19.0
2.8
23.9
21.5
21.5
13.6
0.6
13.6
12.8
12.8
11.5
-3.4
13.9
12.7
16.4
10.9
-1.8
16.4
16.4
24.3
11.9
-3.6
12.4
11.7
17.5
8.8
-1.6
n.a.
n.a.
21.0
8.1
3.1
20.4
19.5
26.1
8.6
9.9
n.a.
9.3
13.5
5.9
25.6
8.9
10.3
13.4
6.6
18.1
Source: Banks data adapted by Fitch; *12-month pro-forma figures (Published 2012 Annual Report covers the period from March to December 2012 when the bank was under
Special Administration)
Banque de Commerce et de Placements SA
July 2014
10
Banks
Banque de Commerce et de Placements SA
Income Statement
31 Mar 2014
3 Months - 1st Quarternths - 1st Quarter
USDm
CHFm
Unaudited
Unaudited
1. Interest Income on Loans
2. Other Interest Income
3. Dividend Income
4. Gross Interest and Dividend Income
5. Interest Expense on Customer Deposits
6. Other Interest Expense
7. Total Interest Expense
8. Net Interest Income
9. Net Gains (Losses) on Trading and Derivatives
10. Net Gains (Losses) on Other Securities
11. Net Gains (Losses) on Assets at FV through Income Statement
12. Net Insurance Income
13. Net Fees and Commissions
14. Other Operating Income
15. Total Non-Interest Operating Income
16. Personnel Expenses
17. Other Operating Expenses
18. Total Non-Interest Expenses
19. Equity-accounted Profit/ Loss - Operating
20. Pre-Impairment Operating Profit
21. Loan Impairment Charge
22. Securities and Other Credit Impairment Charges
23. Operating Profit
24. Equity-accounted Profit/ Loss - Non-operating
25. Non-recurring Income
26. Non-recurring Expense
27. Change in Fair Value of Own Debt
28. Other Non-operating Income and Expenses
29. Pre-tax Profit
30. Tax expense
31. Profit/Loss from Discontinued Operations
32. Net Income
33. Change in Value of AFS Investments
34. Revaluation of Fixed Assets
35. Currency Translation Differences
36. Remaining OCI Gains/(losses)
37. Fitch Comprehensive Income
38. Memo: Profit Allocation to Non-controlling Interests
39. Memo: Net Income after Allocation to Non-controlling Interests
40. Memo: Common Dividends Relating to the Period
41. Memo: Preferred Dividends Related to the Period
Exchange rate
Banque de Commerce et de Placements SA
July 2014
11.3
2.5
n.a.
13.8
n.a.
2.9
2.9
10.9
0.6
(0.1)
n.a.
n.a.
12.2
0.1
12.8
8.9
3.5
12.4
n.a.
11.2
1.0
n.a.
10.2
n.a.
n.a.
n.a.
n.a.
n.a.
10.2
1.9
n.a.
8.3
n.a.
n.a.
n.a.
n.a.
8.3
n.a.
8.3
n.a.
n.a.
10.0
2.2
n.a.
12.2
n.a.
2.6
2.6
9.6
0.5
(0.1)
n.a.
n.a.
10.8
0.1
11.3
7.9
3.1
11.0
n.a.
9.9
0.9
n.a.
9.0
n.a.
n.a.
n.a.
n.a.
n.a.
9.0
1.7
n.a.
7.3
n.a.
n.a.
n.a.
n.a.
7.3
n.a.
7.3
n.a.
n.a.
USD1 = CHF0.88400
As % of
Earning Assets
2.05
0.45
2.50
0.53
0.53
1.97
0.10
(0.02)
2.22
0.02
2.32
1.62
0.64
2.26
2.03
0.18
1.85
1.85
0.35
1.50
1.50
1.50
-
31 Dec 2013
Year End
As % of
CHFm
Earning
Unqualified
Assets
34.0
9.1
n.a.
43.1
n.a.
8.8
8.8
34.3
0.5
0.4
n.a.
n.a.
41.0
(0.3)
41.6
29.1
12.7
41.8
n.a.
34.1
11.3
n.a.
22.8
n.a.
0.3
6.5
n.a.
n.a.
16.6
1.0
n.a.
15.6
n.a.
n.a.
n.a.
n.a.
15.6
n.a.
15.6
n.a.
n.a.
1.86
0.50
2.35
0.48
0.48
1.87
0.03
0.02
2.24
(0.02)
2.27
1.59
0.69
2.28
1.86
0.62
1.24
0.02
0.35
0.91
0.05
0.85
0.85
0.85
-
USD1 = CHF0.89150
31 Dec 2012
Year End
As % of
CHFm
Earning
Unqualified
Assets
38.3
8.8
n.a.
47.1
n.a.
11.1
11.1
36.0
2.6
0.0
n.a.
n.a.
49.4
0.4
52.4
31.1
13.1
44.2
n.a.
44.2
5.8
n.a.
38.4
n.a.
0.5
n.a.
n.a.
n.a.
38.9
8.6
n.a.
30.3
n.a.
n.a.
n.a.
n.a.
30.3
n.a.
30.3
7.0
n.a.
USD1 = CHF0.91660
2.05
0.47
2.52
0.59
0.59
1.92
0.14
0.00
2.64
0.02
2.80
1.66
0.70
2.36
2.36
0.31
2.05
0.03
2.08
0.46
1.62
1.62
1.62
0.37
-
31 Dec 2011
Year End
As % of
CHFm
Earning
Unqualified
Assets
37.1
7.8
n.a.
44.9
n.a.
13.4
13.4
31.5
2.5
0.0
n.a.
n.a.
49.4
(0.4)
51.5
30.3
13.4
43.7
n.a.
39.3
0.2
n.a.
39.1
n.a.
0.7
n.a.
n.a.
(10.5)
29.3
11.7
n.a.
17.6
n.a.
n.a.
n.a.
n.a.
17.6
n.a.
17.6
5.5
n.a.
1.90
0.40
2.30
0.69
0.69
1.61
0.13
0.00
2.53
(0.02)
2.63
1.55
0.69
2.23
2.01
0.01
2.00
0.04
(0.54)
1.50
0.60
0.90
0.90
0.90
0.28
-
USD1 = CHF0.94090
31 Dec 2010
Year End
As % of
CHFm
Earning
Unqualified
Assets
33.8
10.1
n.a.
43.9
n.a.
9.8
9.8
34.1
7.6
n.a.
n.a.
n.a.
54.5
0.5
62.6
31.5
14.4
45.9
n.a.
50.8
(1.1)
n.a.
51.9
n.a.
2.3
n.a.
n.a.
(29.5)
24.7
8.0
n.a.
16.7
n.a.
n.a.
n.a.
n.a.
16.7
n.a.
16.7
7.5
n.a.
1.50
0.45
1.94
0.43
0.43
1.51
0.34
2.41
0.02
2.77
1.39
0.64
2.03
2.25
(0.05)
2.30
0.10
(1.31)
1.09
0.35
0.74
0.74
0.74
0.33
-
USD1 = CHF0.93960
11
Banks
Banque de Commerce et de Placements SA
Balance Sheet
31 Mar 2014
3 Months - 1st Quarterhs - 1st Quarter
USDm
CHFm
As % of
Assets
31 Dec 2013
Year End
As % of
CHFm
Assets
31 Dec 2012
Year End
As % of
CHFm
Assets
31 Dec 2011
Year End
As % of
CHFm
Assets
31 Dec 2010
Year End
As % of
CHFm
Assets
Assets
A. Loans
1. Residential Mortgage Loans
2. Other Mortgage Loans
3. Other Consumer/ Retail Loans
4. Corporate & Commercial Loans
5. Other Loans
6. Less: Reserves for Impaired Loans
7. Net Loans
8. Gross Loans
9. Memo: Impaired Loans included above
10. Memo: Loans at Fair Value included above
B. Other Earning Assets
1. Loans and Advances to Banks
2. Reverse Repos and Cash Collateral
3. Trading Securities and at FV through Income
4. Derivatives
5. Available for Sale Securities
6. Held to Maturity Securities
7. Equity Investments in Associates
8. Other Securities
9. Total Securities
10. Memo: Government Securities included Above
11. Memo: Total Securities Pledged
12. Investments in Property
13. Insurance Assets
14. Other Earning Assets
15. Total Earning Assets
C. Non-Earning Assets
1. Cash and Due From Banks
2. Memo: Mandatory Reserves included above
3. Foreclosed Real Estate
4. Fixed Assets
5. Goodwill
6. Other Intangibles
7. Current Tax Assets
8. Deferred Tax Assets
9. Discontinued Operations
10. Other Assets
11. Total Assets
Liabilities and Equity
D. Interest-Bearing Liabilities
1. Customer Deposits - Current
2. Customer Deposits - Savings
3. Customer Deposits - Term
4. Total Customer Deposits
5. Deposits from Banks
6. Repos and Cash Collateral
7. Other Deposits and Short-term Borrowings
8. Total Deposits, Money Market and Short-term Funding
9. Senior Debt Maturing after 1 Year
10. Subordinated Borrowing
11. Other Funding
12. Total Long Term Funding
13. Derivatives
14. Trading Liabilities
15. Total Funding
E. Non-Interest Bearing Liabilities
1. Fair Value Portion of Debt
2. Credit impairment reserves
3. Reserves for Pensions and Other
4. Current Tax Liabilities
5. Deferred Tax Liabilities
6. Other Deferred Liabilities
7. Discontinued Operations
8. Insurance Liabilities
9. Other Liabilities
10. Total Liabilities
F. Hybrid Capital
1. Pref. Shares and Hybrid Capital accounted for as Debt
2. Pref. Shares and Hybrid Capital accounted for as Equity
G. Equity
1. Common Equity
2. Non-controlling Interest
3. Securities Revaluation Reserves
4. Foreign Exchange Revaluation Reserves
5. Fixed Asset Revaluations and Other Accumulated OCI
6. Total Equity
7. Total Liabilities and Equity
8. Memo: Fitch Core Capital
9. Memo: Fitch Eligible Capital
Exchange rate
Banque de Commerce et de Placements SA
July 2014
n.a.
n.a.
n.a.
n.a.
1,149.1
n.a.
1,149.1
1,149.1
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
1,015.8
n.a.
1,015.8
1,015.8
n.a.
n.a.
42.81
42.81
42.81
-
n.a.
n.a.
n.a.
n.a.
945.2
12.6
932.6
945.2
12.8
n.a.
43.85
0.58
43.27
43.85
0.59
-
n.a.
n.a.
n.a.
n.a.
809.4
1.5
807.9
809.4
1.7
n.a.
37.55
0.07
37.48
37.55
0.08
-
n.a.
n.a.
n.a.
n.a.
814.2
0.4
813.8
814.2
0.6
n.a.
35.40
0.02
35.38
35.40
0.03
-
n.a.
n.a.
n.a.
990.2
n.a.
1.6
988.6
990.2
1.8
n.a.
38.83
0.06
38.76
38.83
0.07
-
895.8
n.a.
18.2
n.a.
n.a.
n.a.
n.a.
173.5
191.7
n.a.
n.a.
n.a.
n.a.
n.a.
2,236.7
791.9
n.a.
16.1
n.a.
n.a.
n.a.
n.a.
153.4
169.5
n.a.
n.a.
n.a.
n.a.
n.a.
1,977.2
33.37
0.68
6.46
7.14
83.32
702.3
n.a.
23.2
4.6
n.a.
160.8
n.a.
8.8
197.4
n.a.
n.a.
n.a.
n.a.
n.a.
1,832.3
32.58
1.08
0.21
7.46
0.41
9.16
85.01
890.6
n.a.
4.5
1.7
n.a.
156.0
n.a.
9.7
171.9
n.a.
n.a.
n.a.
n.a.
n.a.
1,870.4
41.32
0.21
0.08
7.24
0.45
7.97
86.77
992.9
n.a.
18.7
3.9
n.a.
116.4
0.1
9.5
148.6
n.a.
n.a.
n.a.
n.a.
n.a.
1,955.3
43.16
0.81
0.17
5.06
0.00
0.41
6.46
85.00
1,142.7
n.a.
16.5
14.2
97.5
n.a.
0.1
n.a.
128.3
n.a.
n.a.
n.a.
n.a.
n.a.
2,259.6
44.81
0.65
0.56
3.82
0.00
5.03
88.60
433.1
n.a.
n.a.
2.8
n.a.
n.a.
n.a.
n.a.
n.a.
11.8
2,684.4
382.9
n.a.
n.a.
2.5
n.a.
n.a.
n.a.
n.a.
n.a.
10.4
2,373.0
16.14
0.11
0.44
100.00
314.5
n.a.
n.a.
2.5
n.a.
n.a.
n.a.
n.a.
n.a.
6.2
2,155.5
14.59
0.12
0.29
100.00
276.7
n.a.
n.a.
2.9
n.a.
n.a.
n.a.
n.a.
n.a.
5.6
2,155.6
12.84
0.13
0.26
100.00
335.7
n.a.
n.a.
3.5
n.a.
n.a.
n.a.
n.a.
n.a.
5.8
2,300.3
14.59
0.15
0.25
100.00
278.8
n.a.
n.a.
4.6
n.a.
n.a.
n.a.
n.a.
n.a.
7.3
2,550.3
10.93
0.18
0.29
100.00
704.6
n.a.
n.a.
704.6
1,534.5
n.a.
n.a.
2,239.1
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2,239.1
622.9
n.a.
n.a.
622.9
1,356.5
n.a.
n.a.
1,979.4
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
1,979.4
26.25
26.25
57.16
83.41
83.41
n.a.
598.3
n.a.
598.3
1,166.0
n.a.
n.a.
1,764.3
n.a.
n.a.
n.a.
n.a.
1.3
n.a.
1,765.6
27.76
27.76
54.09
81.85
0.06
81.91
339.0
0.0
263.2
602.2
1,167.4
n.a.
n.a.
1,769.6
n.a.
n.a.
n.a.
n.a.
1.9
n.a.
1,771.5
15.73
0.00
12.21
27.94
54.16
82.09
0.09
82.18
245.4
0.0
499.4
744.8
1,176.9
n.a.
n.a.
1,921.7
n.a.
n.a.
n.a.
n.a.
6.1
n.a.
1,927.8
10.67
0.00
21.71
32.38
51.16
83.54
0.27
83.81
482.6
n.a.
456.4
939.0
1,274.5
n.a.
7.0
2,220.5
n.a.
n.a.
n.a.
n.a.
0.8
n.a.
2,221.3
18.92
17.90
36.82
49.97
0.27
87.07
0.03
87.10
n.a.
n.a.
2.4
n.a.
n.a.
37.0
n.a.
n.a.
2.9
2,281.4
n.a.
n.a.
2.1
n.a.
n.a.
32.7
n.a.
n.a.
2.6
2,016.8
0.09
1.38
0.11
84.99
n.a.
n.a.
1.2
n.a.
n.a.
31.9
n.a.
n.a.
0.9
1,799.6
0.06
1.48
0.04
83.49
n.a.
n.a.
0.3
n.a.
n.a.
42.3
n.a.
n.a.
0.7
1,814.8
0.01
1.96
0.03
84.19
n.a.
n.a.
0.6
n.a.
n.a.
38.2
n.a.
n.a.
17.8
1,984.4
0.03
1.66
0.77
86.27
n.a.
1.7
n.a.
n.a.
n.a.
31.0
n.a.
n.a.
1.0
2,255.0
0.07
1.22
0.04
88.42
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
-
n.a.
n.a.
-
n.a.
n.a.
-
n.a.
n.a.
-
402.9
n.a.
n.a.
n.a.
n.a.
402.9
2,684.4
402.9
402.9
356.2
n.a.
n.a.
n.a.
n.a.
356.2
2,373.0
356.2
356.2
15.01
15.01
100.00
15.01
15.01
355.9
n.a.
n.a.
n.a.
n.a.
355.9
2,155.5
355.9
355.9
16.51
16.51
100.00
16.51
16.51
340.8
n.a.
n.a.
n.a.
n.a.
340.8
2,155.6
340.8
340.8
15.81
15.81
100.00
15.81
15.81
315.9
n.a.
n.a.
n.a.
n.a.
315.9
2,300.3
315.9
n.a.
13.73
13.73
100.00
13.73
-
295.3
n.a.
n.a.
n.a.
n.a.
295.3
2,550.3
295.3
n.a.
11.58
11.58
100.00
11.58
-
USD1 = CHF0.88400
USD1 = CHF0.89150
USD1 = CHF0.91660
USD1 = CHF0.94090
USD1 = CHF0.93960
12
Banks
Banque de Commerce et de Placements SA
Summary Analytics
31 Mar 2014
3 Months - 1st Quarter
A. Interest Ratios
1. Interest Income on Loans/ Average Gross Loans
2. Interest Expense on Customer Deposits/ Average Customer Deposits
3. Interest Income/ Average Earning Assets
4. Interest Expense/ Average Interest-bearing Liabilities
5. Net Interest Income/ Average Earning Assets
6. Net Int. Inc Less Loan Impairment Charges/ Av. Earning Assets
7. Net Interest Inc Less Preferred Stock Dividend/ Average Earning Asset
B. Other Operating Profitability Ratios
1. Non-Interest Income/ Gross Revenues
2. Non-Interest Expense/ Gross Revenues
3. Non-Interest Expense/ Average Assets
4. Pre-impairment Op. Profit/ Average Equity
5. Pre-impairment Op. Profit/ Average Total Assets
6. Loans and securities impairment charges/ Pre-impairment Op. Profit
7. Operating Profit/ Average Equity
8. Operating Profit/ Average Total Assets
9. Taxes/ Pre-tax Profit
10. Pre-Impairment Operating Profit / Risk Weighted Assets
11. Operating Profit / Risk Weighted Assets
C. Other Profitability Ratios
1. Net Income/ Average Total Equity
2. Net Income/ Average Total Assets
3. Fitch Comprehensive Income/ Average Total Equity
4. Fitch Comprehensive Income/ Average Total Assets
5. Net Income/ Av. Total Assets plus Av. Managed Securitized Assets
6. Net Income/ Risk Weighted Assets
7. Fitch Comprehensive Income/ Risk Weighted Assets
D. Capitalization
1. Fitch Core Capital/ Risk Weighted Assets
2. Fitch Eligible Capital/ Risk Weighted Assets
3. Tangible Common Equity/ Tangible Assets
4. Tier 1 Regulatory Capital Ratio
5. Total Regulatory Capital Ratio
6. Core Tier 1 Regulatory Capital Ratio
7. Equity/ Total Assets
8. Cash Dividends Paid & Declared/ Net Income
9. Cash Dividend Paid & Declared/ Fitch Comprehensive Income
10. Cash Dividends & Share Repurchase/Net Income
11. Internal Capital Generation
E. Loan Quality
1. Growth of Total Assets
2. Growth of Gross Loans
3. Impaired Loans/ Gross Loans
4. Reserves for Impaired Loans/ Gross Loans
5. Reserves for Impaired Loans/ Impaired Loans
6. Impaired loans less Reserves for Impaired Loans/ Fitch Core Capital
7. Impaired Loans less Reserves for Impaired Loans/ Equity
8. Loan Impairment Charges/ Average Gross Loans
9. Net Charge-offs/ Average Gross Loans
10. Impaired Loans + Foreclosed Assets/ Gross Loans + Foreclosed Ass
F. Funding
1. Loans/ Customer Deposits
2. Interbank Assets/ Interbank Liabilities
3. Customer Deposits/ Total Funding (excluding derivatives)
Banque de Commerce et de Placements SA
July 2014
31 Dec 2013
Year End
31 Dec 2012
Year End
31 Dec 2011
Year End
31 Dec 2010
Year End
4.08
n.a.
2.60
0.56
2.04
1.85
2.04
3.91
n.a.
2.26
0.48
1.80
1.20
1.80
4.82
n.a.
2.52
0.61
1.93
1.62
1.93
3.95
n.a.
2.17
0.65
1.52
1.51
1.52
3.99
n.a.
2.04
0.47
1.59
1.64
1.59
54.07
52.63
1.97
11.27
1.77
9.09
10.25
1.61
18.89
n.a.
n.a.
54.81
55.07
1.88
9.87
1.54
33.14
6.60
1.03
6.02
2.03
1.36
59.28
50.00
2.02
13.48
2.02
13.12
11.71
1.75
22.11
2.89
2.51
62.05
52.65
1.82
12.93
1.64
0.51
12.87
1.63
39.93
2.43
2.42
64.74
47.47
1.92
18.27
2.13
(2.17)
18.67
2.17
32.39
2.80
2.86
8.31
1.31
8.31
1.31
n.a.
n.a.
n.a.
4.52
0.70
4.52
0.70
n.a.
0.93
0.93
9.24
1.38
9.24
1.38
n.a.
1.98
1.98
5.79
0.73
5.79
0.73
n.a.
1.09
1.09
6.01
0.70
6.01
0.70
n.a.
0.92
0.92
n.a.
n.a.
15.01
n.a.
n.a.
n.a.
15.01
n.a.
n.a.
n.a.
8.31
21.20
21.20
16.51
19.92
19.99
19.92
16.51
n.a.
n.a.
n.a.
4.38
22.26
22.26
15.81
21.80
n.a.
21.80
15.81
23.10
23.10
n.a.
6.84
19.54
n.a.
13.73
19.20
n.a.
19.20
13.73
31.25
31.25
n.a.
3.83
16.30
n.a.
11.58
15.88
15.89
15.89
11.58
44.91
44.91
n.a.
3.12
10.09
7.47
n.a.
n.a.
n.a.
n.a.
n.a.
0.37
n.a.
n.a.
0.00
16.78
1.35
1.33
98.44
0.06
0.06
1.30
n.a.
1.35
(6.29)
(0.59)
0.21
0.19
88.24
0.06
0.06
0.73
n.a.
0.21
(9.80)
(17.77)
0.07
0.05
66.67
0.06
0.06
0.02
n.a.
0.07
1.12
27.72
0.18
0.16
88.89
0.07
0.07
(0.13)
0.21
0.18
163.08
58.38
31.47
157.98
60.23
33.91
134.41
76.29
34.03
109.32
84.37
38.76
105.45
89.66
42.29
13
Banks
Banque de Commerce et de Placements SA
Reference Data
31 Mar 2014
3 Months - 1st Quarterhs - 1st Quarter
USDm
CHFm
A. Off-Balance Sheet Items
1. Managed Securitized Assets Reported Off-Balance Sheet
2. Other off-balance sheet exposure to securitizations
3. Guarantees
4. Acceptances and documentary credits reported off-balance sheet
5. Committed Credit Lines
6. Other Contingent Liabilities
7. Total Business Volume
8. Memo: Risk Weighted Assets
9. Fitch Adjustments to Risk Weighted Assets
10. Fitch Adjusted Risk Weighted Assets
B. Average Balance Sheet
Average Loans
Average Earning Assets
Average Assets
Average Managed Securitized Assets (OBS)
Average Interest-Bearing Liabilities
Average Common equity
Average Equity
Average Customer Deposits
As % of
Assets
31 Dec 2013
Year End
As % of
CHFm
Assets
31 Dec 2012
Year End
As % of
CHFm
Assets
31 Dec 2011
Year End
As % of
CHFm
Assets
31 Dec 2010
Year End
As % of
CHFm
Assets
n.a.
n.a.
n.a.
n.a.
77.7
678.8
3,441.0
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
68.7
600.1
3,041.8
n.a.
n.a.
n.a.
2.90
25.29
128.18
-
n.a.
n.a.
n.a.
637.9
68.8
63.5
2,925.7
1,678.8
0.0
1,678.8
29.59
3.19
2.95
135.73
77.88
0.00
77.88
n.a.
n.a.
n.a.
519.3
27.3
45.8
2,748.0
1,531.2
0.0
1,531.2
24.09
1.27
2.12
127.48
71.03
0.00
71.03
n.a.
n.a.
n.a.
601.7
71.0
40.8
3,013.8
1,616.6
0.0
1,616.6
26.16
3.09
1.77
131.02
70.28
0.00
70.28
n.a.
n.a.
n.a.
n.a.
723.7
53.8
3,327.8
1,812.0
n.a.
1,812.0
28.38
2.11
130.49
71.05
71.05
1,109.2
2,154.8
2,561.4
n.a.
2,118.2
402.8
402.8
690.7
980.5
1,904.8
2,264.3
n.a.
1,872.5
356.1
356.1
610.6
41.32
80.27
95.42
78.91
15.01
15.01
25.73
869.7
1,910.2
2,220.2
n.a.
1,833.0
345.5
345.5
618.6
40.35
88.62
103.00
85.04
16.03
16.03
28.70
794.3
1,867.8
2,192.5
n.a.
1,819.2
327.8
327.8
607.6
36.85
86.65
101.71
84.39
15.21
15.21
28.19
940.0
2,071.7
2,396.9
n.a.
2,055.1
303.9
303.9
806.2
40.86
90.06
104.20
89.34
13.21
13.21
35.05
847.2
2,150.8
2,389.3
n.a.
2,079.3
278.0
278.0
819.4
33.22
84.34
93.69
81.53
10.90
10.90
32.13
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
-
862.6
69.9
0.1
n.a.
40.02
3.24
0.00
-
763.8
44.0
0.1
n.a.
35.43
2.04
0.00
-
747.3
66.2
0.1
n.a.
32.49
2.88
0.00
-
931.5
56.6
0.5
n.a.
36.53
2.22
0.02
-
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
-
553.1
149.2
n.a.
n.a.
25.66
6.92
-
731.1
159.5
n.a.
n.a.
33.92
7.40
-
870.6
119.3
3.0
n.a.
37.85
5.19
0.13
-
1,009.9
124.6
8.2
n.a.
39.60
4.89
0.32
-
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
-
511.3
53.2
33.8
n.a.
23.72
2.47
1.57
-
559.9
42.3
n.a.
n.a.
25.97
1.96
-
678.9
65.9
0.0
n.a.
29.51
2.86
0.00
-
879.5
59.1
0.4
n.a.
34.49
2.32
0.02
-
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
-
1,053.7
112.3
n.a.
n.a.
48.88
5.21
-
1,049.3
118.1
n.a.
n.a.
48.68
5.48
-
1,084.2
92.7
n.a.
n.a.
47.13
4.03
-
1,255.4
19.1
n.a.
n.a.
49.23
0.75
-
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
-
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
-
402.9
n.a.
n.a.
356.2
n.a.
n.a.
15.01
-
355.9
n.a.
n.a.
16.51
-
340.8
n.a.
n.a.
15.81
-
315.9
n.a.
n.a.
13.73
-
295.3
n.a.
n.a.
11.58
-
402.9
356.2
15.01
355.9
16.51
340.8
15.81
315.9
13.73
n.a.
-
402.9
0.0
0.0
0.0
0.0
0.0
0.0
0.0
402.9
0.0
0.0
402.9
356.2
0.0
0.0
0.0
0.0
0.0
0.0
0.0
356.2
0.0
0.0
356.2
15.01
0.00
0.00
0.00
0.00
0.00
0.00
0.00
15.01
0.00
0.00
15.01
355.9
0.0
0.0
0.0
0.0
0.0
0.0
0.0
355.9
0.0
0.0
355.9
16.51
0.00
0.00
0.00
0.00
0.00
0.00
0.00
16.51
0.00
0.00
16.51
340.8
0.0
0.0
0.0
0.0
0.0
0.0
0.0
340.8
0.0
0.0
340.8
15.81
0.00
0.00
0.00
0.00
0.00
0.00
0.00
15.81
0.00
0.00
15.81
315.9
0.0
0.0
0.0
0.0
0.0
0.0
0.0
315.9
n.a.
0.0
n.a.
13.73
0.00
0.00
0.00
0.00
0.00
0.00
0.00
13.73
0.00
-
295.3
0.0
0.0
0.0
0.0
0.0
0.0
0.0
295.3
n.a.
0.0
n.a.
11.58
0.00
0.00
0.00
0.00
0.00
0.00
0.00
11.58
0.00
-
C. Maturities
Asset Maturities:
Loans & Advances < 3 months
Loans & Advances 3 - 12 Months
Loans and Advances 1 - 5 Years
Loans & Advances > 5 years
Debt
Debt
Debt
Debt
Securities
Securities
Securities
Securities
Loans
Loans
Loans
Loans
&
&
&
&
< 3 Months
3 - 12 Months
1 - 5 Years
> 5 Years
Advances
Advances
Advances
Advances
to Banks
to Banks
to Banks
to Banks
< 3 Months
3 - 12 Months
1 - 5 Years
> 5 Years
Liability Maturities:
Retail Deposits < 3 months
Retail Deposits 3 - 12 Months
Retail Deposits 1 - 5 Years
Retail Deposits > 5 Years
Other Deposits
Other Deposits
Other Deposits
Other Deposits
Deposits
Deposits
Deposits
Deposits
from
from
from
from
< 3 Months
3 - 12 Months
1 - 5 Years
> 5 Years
Banks
Banks
Banks
Banks
< 3 Months
3 - 12 Months
1 - 5 Years
> 5 Years
Senior Debt Maturing < 3 months
Senior Debt Maturing 3-12 Months
Senior Debt Maturing 1- 5 Years
Senior Debt Maturing > 5 Years
Total Senior Debt on Balance Sheet
Fair Value Portion of Senior Debt
Covered Bonds
Subordinated Debt Maturing < 3 months
Subordinated Debt Maturing 3-12 Months
Subordinated Debt Maturing 1- 5 Year
Subordinated Debt Maturing > 5 Years
Total Subordinated Debt on Balance Sheet
Fair Value Portion of Subordinated Debt
D. Equity Reconciliation
1. Equity
2. Add: Pref. Shares and Hybrid Capital accounted for as Equity
3. Add: Other Adjustments
4. Published Equity
E. Fitch Eligible Capital Reconciliation
1. Total Equity as reported (including non-controlling interests)
2. Fair value effect incl in own debt/borrowings at fv on the B/S- CC only
3. Non-loss-absorbing non-controlling interests
4. Goodwill
5. Other intangibles
6. Deferred tax assets deduction
7. Net asset value of insurance subsidiaries
8. First loss tranches of off-balance sheet securitizations
9. Fitch Core Capital
10. Eligible weighted Hybrid capital
11. Government held Hybrid Capital
12. Fitch Eligible Capital
Exchange Rate
Banque de Commerce et de Placements SA
July 2014
USD1 = CHF0.88400
USD1 = CHF0.89150
USD1 = CHF0.91660
USD1 = CHF0.94090
USD1 = CHF0.93960
14
Banks
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Banque de Commerce et de Placements SA
July 2014
15

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