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Investing.com -- EFG International (SIX:EFGN) shares rose over 5% on Wednesday after the Swiss private bank reported first-half 2025 earnings that exceeded expectations, driven by a sharp rise in trading and other income.
Pre-tax profit reached CHF270 million, 5% above consensus, while operating income rose 15% year-over-year to CHF854 million.
Trading and other income totaled CHF310 million, 31% ahead of estimates, including a CHF54 million insurance recovery.
Excluding that item, the figure was 8% above forecast. Net interest income was 3% below expectations, and fee and commission income came in 1% lower. Operating expenses of CHF574 million were 1% above projections.
Net profit under IFRS increased to CHF221 million, up 36% from the prior year. Operating profit climbed 33% to CHF280 million.
Revenue margins remained stable, with an underlying gross margin of 97 basis points, unchanged year-over-year and up 2 basis points from the previous half.
EFG posted net new money of CHF5.94 billion, marking a 6.5% annualized growth rate, 20% above consensus.
Net inflows were particularly strong in May and June, rising at an 8.7% annualized pace. Assets under management stood at CHF162.3 billion, in line with expectations.
The bank added 35 client relationship officers (CROs) in the period, but the total number declined slightly to 694 from 703 at year-end 2024.
Assets under management per CRO fell 6% from the previous half, mainly due to adverse currency effects.
Margins showed mixed trends. The net commission income margin rose 1 basis point from both the prior half and the year-earlier period.
Interest-related income margin declined by 5 basis points sequentially and 3 basis points year-on-year.
Net interest income dropped 3 basis points half-on-half and 2 basis points year-on-year.
Treasury swap income also decreased. Net other income rose 6 basis points from the previous half and 4 basis points from a year earlier.
EFG reported CHF63 million in run-rate cost savings, exceeding its CHF60 million target. It aims to reach CHF69 million by year-end.
The Common Equity Tier 1 capital ratio declined to 17.1%, 30 basis points below consensus and 60 basis points lower than at year-end 2024, mainly due to temporary currency impacts on Additional Tier 1 instruments.
Financial targets for 2025 were reaffirmed, including 4–6% annual net new money growth, an 85 basis point gross margin, a 69% cost-income ratio, and 15–18% return on tangible equity.