Challenging markets in first quarter 2016

 Today KAS BANK publishes its figures for Q1 2016. The main points are:

  • Net result from operations, excluding non-recurring items, over the first quarter of  € 2.2 million (Q1 2015: € 5.8 million); total net result of € 0.8 million (Q1 2015: € 4.8 million). 
  • Revenues declined 16% to € 26.4 million (Q1 2015: 31.6 million) due to disappointing interest and securities lending returns and lower result on the bond portfolio (result on investments). Continued growth in Asset Servicing commission income. 
  • Over the first quarter the growth in Assets under Administration was 3.4% with the total asset base at € 480 billion (Q4 2015: € 464 billion). 
  • The overall costs during the first quarter of € 25.3 million were in line with last year’s level (Q1 2015: € 25.2 million). Higher IT-costs related to improving operational efficiencies and contributions made to the National Resolution Fund impacted the expense level. 
  • At the end of the first quarter, KAS BANK further strengthened its solvency ratio to 28% (Q4 2015: 24%) and its liquidity coverage ratio increased to 196% (Q4 2015: 143%).

 

During the first quarter, challenging markets resulted in low profitability for KAS BANK. Although the revenues in its core business remained stable and market share was solidified, interest income decreased significantly and securities lending returns fell short of expectations. The pressure on in particular interest income is a consequence of continuing, difficult market conditions. KAS BANK takes further cost management actions to improve the results. The impact of such actions will be announced and implemented in the next months.

On the business development side, we are expecting more motion in the Dutch pensions market as a consequence of the introduction of the Algemeen Pensioen Fonds (APF). Whilst insured pension obligations are being offloaded from the balance sheet of insurance companies to these new vehicles, we expect that in the course of the year a number of pension funds will migrate towards an APF. Currently six (6) parties have applied for an APF licence with the Dutch Central Bank. KAS BANK has adapted its operations to fit the special needs of this new type of pension fund by offering a suite of custody, administration, depositary and reporting services.

Download the press release Challenging Markets in First Quarter as a PDF (opens in new window).