EFG Intl assets fall as strong Swiss franc weighs

Assets at Swiss private bank EFG International fell in 2010 as the negative effects of a strong Swiss franc and withdrawals by institutions outweighed strong new money inflows from private clients.
The bank swung to a full-year net loss of 721.8 mln Swiss francs ($773.6 mln) following an 859.5 mln franc writedown against the Marble Bar hedge fund unit and two other specialist units in the first half of the year.
Including losses attributable to non-controlling assets, EFG losses for the period came to 768.7 mln francs.
EFG said excluding the impairment charges and the amortisation of acquisition-related items and stock options, core net profit fell 10% to 172 mln francs, and the bank reaffirmed its target of 200 mln for 2011.
Assets under management fell 1.6% to 84.8 bln francs, well below analysts' expectations in a Reuters survey.
"H2 was always going to be awful, with markets, currencies and their goodwill write-offs all weighing," said Helvea analyst Peter Thorne.
"The good news is it hasn't affected their ability to recruit client relationship officers or net new money, which were concerns."
Private clients pumped in 11 bln francs and investment performance was slightly positive, but institutional investors pulled money from hedge funds, and the strong franc sharply depressed the value of assets held in other currencies.
Margins shrank to 94 basis points from 107 basis points a year earlier as interest margins and revenues from specialist products fell, though there was an improvement in the second half of the year, EFG said.
Shares were up 1.5% in early trading, outperforming a flat European banks index.
EFG International is part of the EFG Group, which also controls Athens-listed EFG Eurobank, Greece's second-largest lender.