consolidated annual report - Gruppo Banca Sella

item was given by commissions on the trading of securi-
ties and by commissions on investments.
Net interest and other banking income, at € 4,7
million, recorded a decrease of 13% with respect to the
previous year.
Structural costs, standing at € 4,3 million, recorded
a decrease of 2%, cost to income ratio therefore reached
93,3%.
The above mentioned trends allowed the Bank to
reach a net profit for 2004 of € 511.000 (€ 963.000 in
2003). The takeover, which took place during the year,
of P.P.M. Professional Portfolio Management allowed for
an extraordinary income of € 0,3 million.
Customer savings, current accounts and securities
issued amounted to € 16 million, showing a decrease
of 31,6% over 2003, while assets under management
and third party securities held in deposit, standing at €
467,7 million, was substantially unvaried with respect
to 2003.
Cash loans to customers amounted to € 22,4 million,
showing an increase of 21,7% over 2003, while
guarantees, amounting to € 8,3 million, show a reduction
of 8,8%. Loans portfolio quality is very satisfactory,
as neither non-performing loans nor watchlist loans are
recorded.
Sella Bank Luxembourg S.A.
IBL Investment Bank Luxembourg changed its
company name into Sella Bank Luxembourg S.A. in
December 2004. The Bank, company under Luxembourg
law, carries out an activity of custodian, fund
administration and transfer agency services, and offers
private banking services (asset management and
advisorship on investments and legal matters), as well
as domiciliation and administration services for corporate
customers.
During the year internal resources together with the
auditing company accomplished all auditing surveys and
accountancy controls started at the end of 2003, also according
to the request of the local supervising authority.
Organizational and managerial lacks to be ascribed to
the previous company management were highlighted,
which were not so serious as to compromise the regular
development of daily activity and the settlement of
which is about to be completed.
Also with aim of creating the bases for a stable development
of activity, a plan for extraordinary interventions
was promptly set up by the Parent company,
which involved the temporary attachment to the Bank
of staff and the employment of new specialized staff.
The Board of Directors deliberated both the substitution
of the top management of the Bank and of part of
the staff, and the whole review of administrative and IT
procedures, which is in course of completion.
The Parent company at year end decided to carry out
a ricapitalization of the Bank for € 3,5 million through
an increase in capital, so as to adjust the value of capital
to the real needs of the company.
Net interest income, amounting to € 0,7 million, recorded
a decrease of 8,7% if compared to 2003, due to
a reduction in customer savings, current accounts and
securities issued.
Net other banking income, standing at € 11,6 million,
are substantially in line with the results for 2003.
Net interest and other banking income, at € 12,3 million,
showed a slight decrease (-0,6%) with respect to
2003.
Structural costs, equal to € 14,9 million, recorded a
remarkable increase due to: increase of staff expenses
following a growth of staff, costs related to the activity
of the auditing company Deloitte, expenses for due
diligence activity and for staff attached from the Parent
company, expenses for external and legal consultancy
services.
Cost to income ratio therefore stood at 121%.
The above mentioned trends led to net losses for €
3,6 million.
Customer savings, current accounts and securities issued,
at € 280,2 million, recorded a decrease of 11,6%
if compared to 2003, while assets under management
and third parties securities held in deposit, standing at
€ 2.561,4 million, highlighted an increase of 41,6% over
2003, mainly thanks to the activity of the Group sicavs.
Cash loans to customers, reaching € 13,1 million,
Consolidated annual report 2004 - 197