Taxes & Accounting

A N N UA L R E P O R T

Description
ANNUAL REPORT 2002 La BCGE a achevé son redressement BCGE has fully recovered Agefi Sauvetage de la BCGE? Pari réussi! BCGE rescue? Mission accomplished Tribune de Genève La BCGE en bonne
Published
of 80
All materials on our website are shared by users. If you have any questions about copyright issues, please report us to resolve them. We are always happy to assist you.
Related Documents
Share
Transcript
ANNUAL REPORT 2002 La BCGE a achevé son redressement BCGE has fully recovered Agefi Sauvetage de la BCGE? Pari réussi! BCGE rescue? Mission accomplished Tribune de Genève La BCGE en bonne voie de guérison BCGE well on the way to recovery 24 Heures CONTENTS BCGE Group in brief 4 Message from the Chairman of the Board of Directors 7 Message from the Chief Executive Officer Progress of business in Review of the business units 12 Finance and risk management Retail and networks Corporate Private banking Credit control and administration Logistics and information technology Structure and organisation of the BCGE Group 18 Review of the economy in Consolidated accounts of the BCGE Group for Report by the statutory auditors Balance sheet of the BCGE Group Income statement of the BCGE Group Financing table of the BCGE Group Statement of shareholders equity of the BCGE Group Notes to the consolidated accounts for 2002 Information on the Banque Cantonale de Genève Corporate governance 53 BCGE parent company accounts Report by the statutory auditors Parent company balance sheet Parent company income statement Statement of shareholders equity, parent company Notes to the 2002 BCGE parent company accounts A banking group at the service of the region: information on BCGE branches and BCGE Group subsidiaries 76 To find out more about the BCGE Group publications and Internet sites 78 In 2002, BCGE played an active part in the commemoration of the 400th anniversary of the Escalade, the quintessentially Genevan event in the festivities of the Republic the pictures illustrating this annual report take their inspiration from drawings of the Proclamation Procession. For further information THE BCGE GROUP IN BRIEF BCGE Group Geneva made banking solutions The central mission of Banque Cantonale de Genève is to contribute to the development of the Canton of Geneva and the region, by offering all its residents and businesses or institutions banking services which are sustainably competitive and reflect the specific features and potentials of a regional banking establishment. BCGE is listed on the Swiss Stock Exchange SWX (BCGE). The Group employs 919 persons in Geneva, Lausanne, Zurich, Lugano, Lyon and Annecy. On 31 December 2002, assets managed and administered stood at 9.2 billion francs. Consolidated key figures for the BCGE Group in 2002 the results reflect successful recovery In million francs Percentage change Balance sheet total ,9 Shareholders equity ,4 Equity cover ratio 112,5% 64,8% 110,7% 107,2% 123,0% +5,2 Interest and commission income ,4 Operating costs ,5 Gross profit ,0 Net profit , Personnel (In equivalent full-time units) BCGE parent company 841,20 788,90 769,72 728,12 BCGE Group 943,50 900,00 887,52 846,72 Personnel (number of persons) BCGE parent company BCGE Group results in brief After two years, during which its balance sheet was restored to a sound footing and its structures reorganised, the Banque Cantonale de Genève Group moved on to renewed commercial growth in the 2002 financial year with improved results in line with the initial financial plans. Despite the crisis in the financial sector, the gross profit advanced by 3% on 2001 to reach 70.4 million francs. The net result of the BCGE Group for 2002 is -28 million francs (+3 million francs against 31 December 2001). The business plan forecasts positive results for Gross profit resumes its upward path In million francs Dec Dec Dec Total operating income Total other operating costs Gross profit Contributions to the public authorities 2002 Commission paid to the State for the savings guarantee Amount paid to the State for the simple guarantee on the financing of the Fondation de Valorisation Federal, Cantonal and local taxes Total interest paid to savers in million francs 3.0 million francs 1.9 million francs 50.1 million francs THE BCGE GROUP IN BRIEF 5 Information for shareholders BCGE share Security number ISIN number CH Share capital 360 million francs BCGE shareholding structure distribution of the share capital 44 Genevan local authorities Private shareholders (including bank staff) City of Geneva 7,33% (free float) 21,97% 20,87% Trend of BCGE share price against SMI in ,83% Geneva canton J F M A M J J A S O N D Banque Cantonale de Genève share SMI performance Number of shares (bearer and registered shares in thousands as of 31 December) , , , , ,8 Stock market capitalisation (bearer and registered shares in million francs as of 31 December) ,3 661,5 756,0 615,6 504,0 Share symbols Market listing Swiss stock market Reuters Bloomberg Telekurs History of BCGE bearer share price (in francs) SWX BCGZ.S BCGE SW BCGE Highest price Lowest prices Closing price as of 31 December Book equity/number of shares: 177 (as of 31 December 2002) Calendar General Meeting of shareholders 20 May 2003 First half 2003 results August 2003 Annual results 2003 March 2004 General Meeting of shareholders May 2004 Information BCGE Group: Investor relations and institutional communication Misha Nagelmackers Tel: +41 (0) Fax: +41 (0) Banking relations François Julia Tel: +41 (0) Fax: +41 (0) Postal address: P.O. Box 2251 CH 1211 Geneva 2 THE BCGE GROUP IN BRIEF Main collaborative ventures of the BCGE Group Mortgage Bond Centre of the Swiss Cantonal Banks Founded by the Cantonal Banks in 1931 in Zurich, the Mortgage Bond Centre (CLG) is one of the two Swiss agencies established for this purpose by the Federal Law on the issue of mortgage bonds (known today as the Mortgage Bond Law). All the Cantonal Banks are both members and shareholders of this central organisation. The Mortgage Bond Centre grants long-term loans to the Cantonal Banks against mortgage bonds. These are used exclusively for the financing of mortgage lending and cover about 14% of the refinancing volume needed by its members. The Centre raises funds by regularly issuing mortgage bonds on the Swiss capital market and through private placings. With a volume in circulation of 27 billion francs (as of ), it is one of the principal operators in this area. Its loans are listed on the stock market and traded daily. The Moody s Investor Service rating agency recently emphasised the reliability and excellent quality of the bonds issued by CLG by giving them its highest AAA rating. Blaise Goetschin, Chief Executive Officer of Banque Cantonale de Genève, is Vice Chairman of the Board of Directors of the Mortgage Bond Centre of the Swiss Cantonal Banks. Union of Swiss Cantonal Banks In 1907, the Cantonal Banks entered into a grouping known as the Union of Swiss Cantonal Banks (UBCS). The aim of this cooperative venture between the Cantonal Banks is to share needs and competences by capitalising on their respective strengths, developing synergies and reducing costs. Local routes and proximity to customers, two great assets of the Cantonal Banks, are exploited to the full while respecting the independence of each institution. In parallel, the development of bilateral and multilateral cooperation continues. Swissca Holding SA Created in 1993, this company provides modern financial services and advice on asset formation, portfolio management, occupational benefits and international trade in securities. The complimentary approach and close cooperation between the Swissca companies and the Cantonal Banks are the cornerstones of the success of all the partners concerned. Alain Spadone, a member of the general management of Banque Cantonale de Genève, Private Banking Division, is also a member of the Board of Directors of Swissca Holding SA. Fondation Genève Place Financière The Fondation Genève Place Financière (Geneva Financial Centre Foundation) is a development instrument at the service of a prestigious banking and financial centre. Its vocation is to respond to joint needs through a professional and innovative dynamic in the area of promotion and training. The Foundation does not replace the financial actors who are the leading players in the dynamic growth of Geneva. The Foundation federates, brings together, organises and creates events from which Geneva as a banking and financial centre can benefit. The Foundation acts as a figurehead enabling its discussion partners to benefit from its experience and expertise. Blaise Goetschin, Chief Executive Officer of Banque Cantonale de Genève, is a member of the Board of the Genève Place Financière Foundation. Higher Institute for Training in Banking The Higher Institute for Training in Banking is an association of the banks in Geneva which provides a platform for specialised occupational training in banking and asset management to which its members have priority access. Its vocation is to offer a range of à la carte courses and diplomas enabling professionals in the banking and financial sector to develop their competences and perfect their expertise. Its diplomas are recognised by the canton. Through its activity, the institute plays a key role in maintaining the competitiveness of the Genevan financial centre and safeguarding its long-term future. Blaise Goetschin, Chief Executive Officer of Banque Cantonale de Genève, is Vice Chairman of the Higher Institute for Training in Banking. FAME International Centre for Financial Asset Management and Engineering FAME s ambition is to convert the Lake Geneva region into the intellectual capital of the world of asset management and financial engineering, on par with the role and place of Switzerland as a world-recognised financial centre. To that end, FAME wants to be a pole of attraction for top students and researchers and a reference centre for joint projects between the investment and academic worlds. Its strategy is to build on existing academic strengths, remedy current weaknesses and develop synergies among affiliated academic and professional institutions. Blaise Goetschin, Chief Executive Officer of Banque Cantonale de Genève, is a member of the FAME Foundation Board. MESSAGE FROM THE CHAIRMAN OF THE BOARD OF DIRECTORS 7 Dear Shareholders, Customers and Colleagues, 2002 was another year of economic gloom in most activity sectors. The recovery is slow in materialising and analysts do not expect the tendency to be reversed in The banking sector, especially in the field of asset management, has not been able to escape this trend. We have seen a general and far-reaching processing of restructuring affecting private bankers and asset managers too who had hitherto been spared by the crisis. The stock market has few reasons for buoyancy and optimism. Even the shares in companies which are reporting strong profits are caught up in the downward spiral. International tensions and the hostilities triggered between certain nations can only strengthen these feelings of uncertainty and anxiety. The bond market reflects historically low interest rates and many investors are holding back as the experts do not anticipate a recovery until next summer. Interestingly enough, mortgage rates are at their lowest since Faced with these unfavourable factors, Banque Cantonale de Genève has reason to be satisfied with its operating results for the financial year 2002, which testify to the success of its recovery plan. Following a period of crisis in 1999 and 2000, and a phase of sweeping reorganisation in 2001, last year saw the commercial redeployment of the Bank with a trend change for all its key indicators. The results of the parent company have been positive since 1 October 2002 and, if we disregard the latest provisions to cover past problems, the Group s result is already back in the profit zone. Now that the purely financial aspects have been brought under control, we must work resolutely towards ongoing improvement of our productivity and the modernisation of some working instruments. We are accordingly reviewing all our internal procedures and putting in place the best possible degree of standardisation to seek higher efficiency for our services to customers, while reducing our production costs. On the information technology side, we have many projects too. They are designed to ensure better user-friendliness, higher processing capacities at a lower price without endangering the quality of the risks and services offered. In parallel, we propose to continue our efforts in the area of staff training, at every level of the hierarchy, to ensure that each individual is capable not only of perfectly performing his or her tasks and of responding to all the needs of our customers, but also of achieving personal development. Banque Cantonale de Genève intends to remain a neighbourhood bank at the service of all the Genevans and inhabitants of the region. In the area of wealth management, the launch at the end of 2001 of the BCGE Best of mandate, demonstrated the creativity of the Bank and its ability to regenerate. SMBs are the focus of all our attention because we intend to retain and strengthen our position as the natural leader. One Genevan business out of two uses our banking services and one out of three has at least one credit line. The Bank is well equipped to pursue its redeployment harmoniously. All our staff have shown a remarkable spirit and indeed a meritorious enthusiasm after the years of instability and anxiety experienced by them. On behalf of the Board of Directors, I wish to thank them all for their contribution to the successes achieved so far. The Board of Directors has set itself the target of reviewing the Bank s corporate governance as a priority endeavour. Five committees have been set up for this purpose drawing on our staff, all our directors and also, in some cases, on outside consultants. Some 130 topics have been listed and grouped together under thirty headings. In addition, the draft of a new ethical charter has been written and will be submitted to the General Meeting for approval on 20 May Only recently, the bodies of the Bank were still working in crisis mode. That period is now behind us. Consequently, the organisational structures of the Bank must be adapted not only to the new statutory provisions and the new code of governance of the Swiss stock market SWX, but also to the needs of management typified by a revitalised spirit of ambition. I would not like to end this message without addressing my sincere thanks to the State of Geneva, in particular to Mrs Micheline Calmy-Rey, now a member of the Federal Council, for the constant support from which the Banque Cantonale de Genève has benefited in its recent history. Thanks to that support, we can now claim to have successfully completed an essential process of restructuring. The time has come to direct our entire attention towards our promising future. We intend to build that future in close cooperation with Mrs Martine Brunschwig-Graf, Councillor of State and Minister of Finance since last March, in the interest of the Banque Cantonale de Genève. It was my honour to take over the chairmanship of BCGE on 1 June 2002, confident that we could rise to the challenge of achieving our recovery and restoring to the Bank the scale and financial health which it needs if it is to play its full role in supporting the economy of our region. In that capacity, I wish to thank my colleagues on the Board and the General Management who have shown total solidarity with the cause of our establishment and a boundless commitment to our work. Michel Mattacchini Chairman of the Board of Directors View of Geneva and the Mont-Blanc, circa 1815 S.d. Leuthold MESSAGE FROM THE CHIEF EXECUTIVE OFFICER 9 Successful recovery of the BCGE Group confirmed by 2002 results Ladies and Gentlemen, dear Shareholders, dear Customers, For the Banque Cantonale de Genève (BCGE) Group, the last two years have been devoted to the restructuring of the Balance Sheet and to a thorough internal reorganisation. These improvements are beginning to bear fruit, as the year 2002 delivered improved results in line with target. The Bank s key financial objectives for 2002 have been achieved: - consolidation of the equity basis, - improvement of refinancing conditions, - increase of return on assets, - minimisation of risks relating to new business, - successful launch of a new asset management concept, - improvement of productivity, following the completion of four savings programs. Over and above this, the Bank has paid particular attention to training, to the recruitment of specialised professionals and to the introduction of a certification program for professions connected with client relationship. Finally, the Bank was able to focus its Balance Sheet strategy on building a portfolio of quality credits while at the same time increasing interest margins, which will lead to continuous improvement in long-term profitability. The capital adequacy ratio exceeded 120%, which confirms the «new» Bank s return to the group of financial institutions with a solid capital base. Less assets, but increased margins The total Balance Sheet amounts to CHF 15.4 billion, down CHF 1.7 billion from With this resizing, the Bank intends to concentrate on higher-return business with lower risk profiles. Client and bank receivables, without Fondation de Valorisation des Actifs de la Banque cantonale de Genève (Foundation of Valorisation), stabilised at CHF 8.63 billion. The quality of the credit portfolio improved notably. A systematic introduction of ratings and the execution of work-out and legal procedures for all accounts representing default and recovery risks, led to an improvement of the risk/profitability ratio (86% of total bank credits are now of good to excellent quality). Reduction, during the period under review, in the liabilities of the Fondation de Valorisation towards the Bank (CHF 687 million), further contributed to improving the Balance Sheet. This is part of a 10-year liabilities reduction program, amounting to approximately CHF 500 million of liabilities reduction p.a., which is in the Bank s interest and best corresponds to its capacities. in million francs Interest income 168 Interest expenses Net interest income Increasing interest margins 161 3,5% 2,5% 1,5% 0,5% 173 Dec Dec Dec market rate 5 years 6 months 130% 120% 110% 100% 90% 80% 70% 60% Return to the group of financial institutions with a solid capital base 123% 64,8% 110,7% 107,2% Coverage ratio Minimum ratio Solid equity base Significantly improved structure of liabilities following a notable increase in savings deposits A CHF million increase in savings deposits in a highly competitive market environment demonstrates the competitiveness of BCGE s banking services and the trust the Bank is regaining, year on year, with the Geneva public. With a reduction in liabilities towards banks by CHF 1.53 billion, BCGE recovered its independent stance in the refinancing market. This positive development testifies to a normalisation of the Bank s liabilities structure, and its average cost is now in line with that of most other Cantonal Banks. December 2001 Launch Spring/autumn 2002 Meetings BCGE Best of Spring 2002 Group Investment philosophy Summer 2002 Launch MESSAGE FROM THE CHIEF EXECUTIVE OFFICER In regard to the growth of savings deposits, the Bank made a special effort to reward the loyalty of clients by introducing a multi-bonus plan, the «BCGE Avantage service». This offers, on certain savings accounts, up to 2% higher interest, in other words, the possibility to cumulate a 0.5% bonus on each of the four following BCGE services: an asset management mandate BCGE Best of, a BCGE mortgage, a portfolio of 20 BCGE shares, and/or the withdrawal of not more than CHF 10,000 on certain savings accounts. The bonus plan comes in addition to already existent bonus programs. As such, in 2002 the Bank rewarded more than 33,500 current clients through the BCGE Avantage service bonus plan BCGE Best of: Outperforming the reference index Best of Balanced in CHF Index (50% bonds, 20% liquid funds, 30% shares) June 01 July 01 Aug. 01 Sept. 01 Oct. 01 Nov. 01 Dec.
Search
Related Search
We Need Your Support
Thank you for visiting our website and your interest in our free products and services. We are nonprofit website to share and download documents. To the running of this website, we need your help to support us.

Thanks to everyone for your continued support.

No, Thanks