2020 consolidated results
Overall positive commercial results, strong increase in net result, financial strength confirmed
Friday, May 7, 2021 — BRUSSELS, MAY 7th, 2021. The Board of Directors of Degroof Petercam has approved the consolidated accounts for the year 2020. These will be submitted to the approval of the shareholders at the General Meeting of May 25.
- Net result of 40.0 million euros (20.2 million in 2019)
- Gross operating profit of 83.0 million euros (84.4 million in 2019)
- Total net revenues of 469.2 million euros (480.6 million in 2019)
- Strong portfolio, fund and mandate performances
- Total client assets (net) at 75 billion euros (74,7 milliards at end 2019)
- Record net inflow in the management entity DPAM with 2.5 billion euros
- Net assets invested in sustainable strategies more than doubled to 14,9 billion euros
- Capital ratio (CET1) : 21.2% (19.5% at end 2019), well in excess of regulatory requirements
Bruno Colmant, CEO of Degroof Petercam : « 2020 will be remembered as a year apart. As far as our company is concerned, the pandemic was not a moment of resignation, but of resilience, and we achieved solid returns for our clients. Despite the difficult market circumstances and the health crisis linked to COVID-19, Degroof Petercam's diversified business model has shown unquestionable resilience, reflected in a record increase in assets in Asset Management and exceptional results in the market activity of Investment Banking.
On behalf of the Management Committee, I would like to express my sincere thanks to the teams who support our clients with unparalleled expertise. I would also like to thank our clients and partners for the trust they have continued to place in us, generation after generation, for 150 years».
Gilles Samyn, Chairman of the Board of Directors of Degroof Petercam : « I am impressed by the considerable efforts and remarkable collective intelligence developed by the employees in the service of our clients. The company's results have been little affected by the crisis and the capitalization rate is solid. Together with the Board, I look forward to continuing the strategic development of the group and to achieving greater operational efficiency».
1. Commercial activities
Fee-generating business posted solid results.
- Private Banking
As of December 31, 2020, private client assets under management amounted to 35.9 billion euros, compared with 38.4 billion in 2019. This decline is explained by the sale of the Spanish subsidiary and an effort to meet regulatory administrative requirements. The many commercial and IT initiatives launched in 2020 should gradually generate tangible results during 2021.
Outstanding loans to customers amounted to 2.0 billion euros at December 31, 2020.
Both the model portfolios and the flagship 'Global Strategy' funds recorded above-average performance over 1, 3 and 5 years. The patrimonial strategy celebrated its 30th anniversary with with high average returns year after year.
- Degroof Petercam Asset Management
The Degroof Petercam Asset Management (DPAM) entity, dedicated to the management of funds and mandates for large institutional accounts and to the distribution of funds, recorded a record level of gross assets under management of 43.3 billion euros at the end of 2020, compared with 39.2 billion euros at the end of last year, an increase of 10% which reflects on the one hand a positive market effect and on the other hand a net inflow of 2.5 billion euros.
DPAM's international expansion strategy continues to bear fruit, with 88% of net capital inflow now coming from abroad.
In 2020, DPAM celebrated the 20th anniversary of the launch of its first sustainable investment strategy, and recorded a doubling of assets invested in sustainable strategies to over 14.9 billion euros in net assets.
The investment strategies have consistently delivered excellent long-term returns. Last year, DPAM received numerous international awards for quality management and investment performance.
- Investment Banking
After a first semester marked by a pause due to the pandemic, activity in M&A, capital markets and research and advisory assignments rebounded remarkably in the second half of the year with a total of more than 50 assignments for the year.
The high volatility of the financial markets, which benefited our trading room, enabled our activities to post a record performance.
- Asset Services
As of December 31, 2020, fund administration services accounted for a record 51.7 billion euros of assets under administration and/or custody, including 8.3 billion euros for mutual funds for third-party clients. The exceptional increase of 27.8% compared to the end of 2019 is mainly explained by the incorporation of the administration of ex-Petercam funds previously administered externally.
This activity thus confirms its position as a major player in this market.
Total client assets (net) : 75 billion euros
In 2020, all activities combined, total client assets increased slightly by 0.4% to 75 billion euros from 74.7 billion euros a year earlier. These are net amounts, after elimination of double counting between the group's various activities, namely management and credit services, administrative services and depository services.
To allow for comparison with the 2020 figures, which no longer take into account the Spanish subsidiary, total customer assets in 2019, excluding Spain, amounted to 73.4 billion euros. On a comparable basis total net customer assets thus grew by 2.2%.
2. Financial results
Total net revenues amounted to 469.2 million euros compared to 480.6 million euros in 2019, a decrease of 2.4%.
Despite the negative interest rate environment, gross operating result stabilized at 83 million euro at December 31, 2020. After taxes and exceptional items, consolidated net result amounted to 40.0 million euro. This clear increase compared to the previous year is explained not only by the higher net fee and commission income, as well as by a significantly lower tax charge in 2020, but also by the exceptional items recognized in 2019, in particular following the sale of our subsidiary in Spain.
At the balance sheet level, as of December 31, 2020, the regulatory capital ratio (CET1) stood at 21.2% compared to 19.5% a year earlier, and the liquidity coverage ratio (LCR) was at 266%, well above the minimum ratios imposed by the regulator.
The balance sheet total amounted to more than 8.8 billion euros, of which more than 4 billion are highly liquid assets, illustrating the financial strength of the group following a conservative policy in the management of its balance sheet and its activities.