Annual Report 2011 - Hong Kong Monetary Authority

Report of the Directors
to the shareholders of Banque Privée Edmond de Rothschild SA
at the ordinary general meeting on 26 April 2012
Balance sheet review
At 31 Dec. 2011 the Bank’s balance sheet total stood at
CHF 7.4 billion, marking a jump of CHF 1.6 billion on the
year-earlier figure.
The increase was mostly due to the high levels of liquid
assets in our clients’ portfolios. In order to ensure maximum
security, the Bank deposited these funds with the
Swiss National Bank and with counterparties under existing
reverse repo agreements.
On the assets side, cash and claims arising from money
market paper totalled CHF 2.3 billion. This item was up
sharply as well (by CHF 2 billion) compared with the previous
year.
Funds due from banks fell CHF 519.7 million to CHF 3 billion,
including CHF 2.7 billion held with correspondents under
reverse repo agreements.
Cash, bank deposits and money market claims together
came to CHF 5.3 billion. This item accounts for 71.1% of the
balance sheet total.
Loans to customers rose sharply to CHF 508.3 million,
marking a 33.2% decrease on the end-2010 level, and
represented 6.8% of the balance sheet total.
Securities and precious metals held for trading purposes
totalled CHF 16.8 million, down slightly on the previous
year’s level.
Financial investments stood at CHF 934.5 million, up
CHF 274.4 million on the year-earlier figure. Most of this rise
was attributable to the stock of precious metals used to
cover our clients’ metal accounts.
Long-term holdings amounted to CHF 223.4 million, compared
with CHF 222.4 million in 2010.
Fixed assets came to CHF 166.7 million, marking an increase
of CHF 74.4 million on the level at end-Dec. 2010. The increase
was primarily due to the purchase of a building for
the Bank’s use in Geneva.
102 2011 ANNUAL REPORT - BANQUE PRIVÉE EDMOND DE ROTHSCHILD SA
Other assets amounted to CHF 283.1 million, as against
CHF 281.9 million the previous year.
On the liabilities side, funds due to banks rose by
CHF 212.6 million to CHF 670.9 million, chiefly reflecting
cash management at the Group level.
At 31 Dec. 2011 customer deposits totalled CHF 5.5 billion
as against CHF 4.1 billion a year earlier. They accounted
for 73.3% of the balance sheet total.
Other liabilities came to CHF 294.9 million, down as a result
of the lower negative replacement values of open forward
currency contracts at the end of the reporting period.
Valuation adjustments and provisions grew by CHF 6.1 million
to CHF 180.5 million, chiefly owing to the increase in “Other
provisions”.
Following appropriation of net income, shareholders’ equity
will amount to CHF 684.0 million, or 9.2% of the balance
sheet total. On that basis return on equity at end-2011
worked out to 15.1%. Applying the BIS rules under Basel II,
required shareholders’ equity totalled CHF 136.1 million
while eligible capital came to CHF 542.8 million. The BIS
ratio stood at 31.9%.