Annual Reports 2011 V ontob el Group - Vontobel Holding AG

trading. Here, the Financial Products division was able to defend its strong market
position in Switzerland and Germany, even if the demand for structured products
declined noticeably towards the end of 2011. In addition, valuation effects on the
asset and liability side had a significant negative net impact of CHF 24 mn on trading
income due to the renewed rise in risk premiums in Europe. The sale of a commercial
property in Geneva contributed CHF 21.6 mn to other income.
Structure of the income
statement
31-12-11 31-12-11 31-12-10 31-12-10
CHF mns in % 1 CHF mns in % 1
Net interest income 60.2 8 53.1 6
Fee and commission income 452.2 59 478.2 58
Trading income 225.3 29 273.9 33
Other income 28.0 4 25.0 3
Total operating income 765.7 100 830.2 100
Personnel expense 373.1 49 392.3 47
General expense 178.9 23 196.2 24
Depreciation, amortization
Valuation adjustments, provisions
60.2 8 61.8 7
and losses 6.6 1 6.8 1
Operating expense 618.8 81 657.1 79
Taxes 33.1 4 25.8 3
Group net profit 113.8 15 147.3 18
1 Share of operating income
Expansion of the international business
The currency composition of the Vontobel Group's income is growing more diversified,
reflecting the increasingly international nature of its business activities. In 2011,
around 43% of the Group's operating income was generated in foreign currencies.
During the year under review, the value of the euro decreased by an average of 11%
against the Swiss franc and the value of the US dollar fell by an average of 15%.
These currency trends reduced Vontobel's level of income by CHF 46 mn. At the
same time, the impact on the cost base was only CHF 15 mn, since 81% of costs are
incurred in Swiss francs. As a result of this effect, the cost reduction measures rapidly
implemented by Vontobel in 2011 were unable to fully offset the decline in income.
Operating expense fell by 6% to CHF 618.8 mn in 2011. Personnel expense
decreased by 5% to CHF 373.1 mn and general expense declined by 9% to
CHF 178.9 mn compared to the previous year. At the end of 2011, the Vontobel
Group had 1,413 employees (FTEs), an increase of 5% from the end of 2010. Depreciation
declined marginally to CHF 60.2 mn (–3%), as planned. The tax rate increased
from 14.9% to 22.5% due to a shift in profit contributions within the Group and a
tax expense in the amount of CHF –5.9 mn unrelated to the accounting period.
Review of business activities
Vontobel Group, Annual Reports 2011 29