Despite an extremely difficult market environment characterised by a war in Europe, high inflation and rising interest rates, 2022 was a very successful year for the bank. With net revenues of CHF 408.0 million and a pre-tax profit of CHF 186.4 million, we accomplished what we set out to achieve. We also recorded a strong net new money inflow of CHF 7.7 billion. At year-end, client assets amounted to CHF 52.2 billion – a real testimony to the trust clients place in us.
As a leader in online banking with over half a million clients, we feel an obligation to play a pioneering role when it comes to protecting the environment too. This is why we see it as our duty to do even more to make clients conscious of sustainable investing. It is also why, on our trading platform, alongside the economic data on a large number of firms, investors will find information on ecological and regulatory aspects as well as a proprietary ESG score. Users can also optimise their portfolios using ESG filters and various evaluation criteria. For the past three years, we have complemented our annual report with a sustainability report prepared in accordance with GRI standards. In 2022, external auditors reviewed the key indicators of this report. We were glad to see that our past efforts have led to an increase of our MSCI ESG rating from BBB to AA.
As a graduate in electrical engineering from the Swiss Federal Institute of Technology (EPFL), I am fascinated by the technology behind the blockchain. I think the events of the past year have started a “housecleaning” process similar to that we witnessed in the online world when the dot-com bubble burst. What is important is that future activities in the crypto area take place within a reliable, regulated framework. With our SQX crypto exchange, we created an efficient trading platform for our clients that ensures secure, cost-efficient execution with sufficient liquidity in the cryptocurrencies traded. More than 15 cryptocurrencies can currently be traded via SQX, and we are well on the way to increasing this number.
Our innovative business model based on a state-of-the-art trading platform with a Swiss banking licence is fully scalable. We therefore have unique avenues for growth in attractive areas of business or in new client segments. Yuh – the finance app that we launched together with PostFinance in 2021 to provide what is probably the most comprehensive offering when it comes to paying, saving and investing – already has more than 100’000 “Yuhsers”. We acquired Keytrade Bank Luxembourg at the start of 2022, as we steadily pursue our expansion in Europe. Last year also saw us take a further step in the direction of a universal bank for private clients with the launch of our own TWINT app. This year, we will massively expand our payment services with eBill and a modern debit card, along with Apple Pay and Google Pay. We will also focus on the further development of our offering of bespoke B2B solutions on a targeted basis. Together with wealthtech solution provider Etops, we launched “Asset Master” this year, a platform for asset managers that enables efficient, affordable portfolio management and trading. Our cooperation with Leonteq, which started in early 2022 and enables us to issue structured products, is also developing well.
We are committed to providing our customary high level of service quality at all times. To this end, we added various locations to our network – in Europe and in Switzerland. We are also delighted that the residents of Gland in the canton of Vaud approved the construction of our new head office, which will comply with sustainable criteria. The move to the “interdisciplinary campus” is scheduled for 2027 at the latest.
With an operating income of CHF 408.1 million, an operating profit of CHF 186.4 million and net new monies of CHF 7.7 billion, Swissquote is reporting robust and qualitatively strong numbers for 2022. Both the operating income and operating profit reached the second-highest levels in history and highlight the strong customer base and product mix in a challenging market environment. The diversification of revenue streams enabled Swissquote to benefit specifically from the change in short term interest rates. In 2022, 51,099 new client accounts (+10.5 percent) contributed to further growth, while total client assets reached CHF 52.2 billion (including CHF 9.2 billion in cash deposits). Swissquote anticipates a promising 2023 with new records in revenues and profit targeted.
Operating income totalled CHF 408.1 million, a decrease of 13.5 percent compared with the previous year (CHF 471.8 million), reflecting the difficult market conditions, but still amount to the second-highest result ever.
Net fee and commission income (excluding crypto assets) decreased by 7.6 percent as the share of non-transaction based revenues was able to compensate for the slowdown in trading activity. Net crypto assets income was impacted significantly by the crypto market turmoil, declining 72.9 percent to CHF 27.7 million (6.8 percent of operating income). Net trading income decreased by 18.0 percent as a result of lower eForex trading volume and lower turnover in asset classes traded in foreign currencies. On the other hand, net interest income increased by 364.7 percent due to rising interest rates across major currencies. Specifically, the CHF policy rate moved from a negative 0.75 percent to a positive 1.0 percent reference rate at the end of 2022.
Overall, Swissquote’s operating income show resilience and diversification of revenue sources.
At CHF 215.0 million, operating expenses were 13.2 percent lower than in the previous year (CHF 247.5 million), reflecting cost management discipline over several months. As at 31 December 2022, total headcount was up by 104 FTE (of which 14 FTE inorganic) to 1,056 FTE. Half of the recruitment occurred in technology-related fields. Operating profit decreased by 16.5 percent to 186.4 million (CHF 223.3 million), while the operating profit margin remained at a high level of 45.7 percent (47.3 percent) despite a 13.5 percent decline in operating income. Net profit decreased to CHF 157.4 million (CHF 193.1 million), and net profit margin to 38.6 percent (40.9 percent).
51,099 new client accounts were opened in 2022 (of which 8,000 inorganic), most of them trading accounts, bringing the total number of clients above the 500k threshold for the first time. 60 percent of the net new monies came from outside of Switzerland, showing the growing penetration of the Swissquote brand. Thanks to the UEFA sponsorship, the Swissquote brand is broadcasted in over 200 countries globally, across hundreds channels, with millions views.
The total number of accounts reached 538,946 (+10.5 percent) by the end of 2022, with deposits averaging almost CHF 100,000 per customer. Strong net new monies of CHF 7.7 billion (of which 1.7 billion inorganic) partly compensated for the market-generated decrease in client assets from CHF 55.9 billion to CHF 52.2 billion (down 6.6 percent). Generally, all asset classes saw decreases in value in 2022, but the customer base remained steadily invested even in high-risk asset classes. As of 31 December 2022, total crypto assets under custody declined to CHF 1.0 billion (CHF 2.8 billion) despite the fact that customers have increased their holdings in major crypto assets (5.7 percent increase).
As of 31 December 2022, the balance sheet remained strong and all regulatory ratios were solid (e.g. liquidity ratio at 496%). Thanks to its capital ratio of 24.8 percent (26.2 percent), well above the regulatory limit of 11.2 percent, Swissquote is well-positioned to capture internal and external growth opportunities (as it did with the acquisition of Keytrade Bank Luxembourg SA in 2022). The Board of Directors will propose to the Annual General Meeting an unchanged dividend of CHF 2.20 per share, corresponding to 21 percent of the net profit for 2022.
Thanks to the initiatives taken in 2022, Swissquote sees the following growth opportunities for this year:
- European market: In early 2023, Swissquote Bank Europe SA received its depositary fund licence in Luxembourg, further expanding its market access to the B2B sector. This concludes various product and expansion initiatives enabling Swissquote to provide a similar offering and with similar target customers to those in Switzerland.
- Crypto assets: Swissquote’s own crypto exchange SQX was successfully launched in September 2022. It is likely that the crypto industry may face an important period of transition with increased regulation. Swissquote sees itself uniquely positioned with SQX.
- Yuh: The mobile finance app already has more than 100,000 users (2022: + 65,000 users) and will further expand its products and services offering in 2023 (e.g. Pillar 3A). For 2023, the growth in accounts should be of a similar magnitude to 2022.
To continue to serve shifting expectations, Swissquote introduced and implemented a wide range of ESG initiatives in favour of various stakeholders. First, customers can now not only analyse their portfolios with sustainability criteria with the support of innovative new ESG tools but as well invest in new impact investing certificates. Secondly, a fresh new “We are all in” employer value proposition was rolled out in order to position Swissquote as a recognised employer brand in the labour market. Early in 2023, Swissquote was ranked among the best employers in Switzerland (#16) and best in the banking sector by Handelszeitung, le Temps and Statista.
On the non-financial reporting side, Swissquote’s Sustainability Report 2022, which is an integral part of Swissquote’s Annual Report, provides independent assurance on quantitative data for the first time. In 2022, Swissquote’s MSCI ESG rating improved from BBB to AA and Inrate zRating ranked Swissquote as showing the best corporate governance in Switzerland for the financial services industry.
In 2022, the Board of Directors set a series of ESG-related objectives within the framework of the Executive Management’s Short-Term Incentive Plan (STIP) and gave a 15% overall weight to such objectives. Moreover, the alignment of the objectives set to the Executive Management with the ESG materiality matrix is now further specified. These developments confirm the importance of sustainability for Swissquote’s strategy.
During the year, Swissquote further intensified its dialogue with shareholders and had the opportunity to discuss topics such as corporate governance, remuneration and sustainability. Shareholders appreciated the responses to the comments made previously, in particular regarding the vesting period of the stock options granted as part of the Executive Management’s Long-Term Incentive Plan. Shareholders also valued, among other things, the enhanced disclosure (for example, with respect to the Executive Management’s objectives set as part of the Short-Term Incentive Plan) and the adoption of limits to cover all remuneration components. All the points raised by shareholders were reviewed and evaluated and, on this basis, further improvements were made to disclosures, including in relation to the Executive Management’s objectives and the CEO pay-ratio.
The Board of Directors has already resolved to make a number of future improvements. For example, in next year’s Remuneration Report, the metrics of the Executive Management’s objectives set for 2023 will be disclosed; this will provide further transparency on these important elements and, as a result, satisfy what may be the most important expectation expressed by shareholders with respect to the Executive Management’s STIP. The Board of Directors also decided that, in the future, a portion of the Executive Management’s bonus will be paid in blocked shares; this will further confirm the alignment of the interests of Executive Management members with those of the shareholders.
Swissquote greatly appreciated the time and active participation of our shareholders and would like to maintain this exchange in the future.
Swissquote announces the following changes to its corporate organisation:
- Esther Finidori will be proposed as a new member of the Board of Directors at the upcoming Annual General Meeting. She is currently Vice President Strategy at Schneider Electric, where she is in particular in charge of sustainability. Esther Finidori has developed a strong expertise in sustainability in general and in environmental aspects and digital transformation specifically, of which Swissquote’s Board of Directors will highly benefit in case she is elected.
- Lino Finini, who currently holds the position of Chief Operating Officer, will be stepping down as a member of the Executive Management effective 31 December 2023 to take retirement. On behalf of the Board of Directors and the Executive Management, we thank Lino Finini for his significant contributions over his career at Swissquote in delivering a number of major initiatives that supported Swissquote’s growth.
The 2023 Annual General Meeting will be held at the Swissquote headquarters, in Gland. On this occasion, the Board of Directors will propose a series of revisions to the Articles of Association, to bring them into line with the revised Swiss Code of Obligations that entered into force on 1 January 2023. The Board of Directors will in particular propose the creation of a capital band valid for a period of five years, which will replace under similar terms the current authorised capital. The latter will expire on 6 May 2023 and is no longer renewable under the revised Swiss Code of Obligations.
Swissquote targets an operating income of CHF 495 million (plus 21 percent) and an operating profit of CHF 230 million (plus 23 percent) for 2023. Despite a cautious stance, Swissquote expects to deliver all-time high results in 2023.
Swissquote’s medium-term target for 2025, i.e. an operating profit at CHF 350 million, is confirmed.
On behalf of the Board of Directors and Executive Management, we would like to thank our clients for their loyalty and contribution to Swissquote’s success and long-term solidity. Thanks to their informed feedback, suggestions and requests, we continuously improve and innovate to deliver exceptional and refreshing banking experiences. Furthermore, we thank our shareholders for the trust they place in us, and all our employees for their hard work and personal commitment to push the boundaries time after time. And finally, we extend our thanks to our cooperation partners for their collaboration and unfailing expertise in helping us to grow our business.
Chairman of the Board
Chief Executive Officer
Swissquote acquires Keytrade Bank Luxembourg
Through its Luxembourg based subsidiary, the Swissquote Group acquires Keytrade Bank Luxembourg. With this acquisition, Swissquote will become the leading online trading and investing bank in Luxembourg and confirms its ambitious strategy in Europe. It also brings together the strengths of both institutions – Swissquote Bank Europe and Keytrade Bank Luxembourg – to become the clear leader in digital investing services in Luxembourg.
Swissquote now an issuer of structured products thanks to cooperation with Leonteq
Swissquote has become an issuer of structured products by entering into a cooperation with Leonteq, with the aim of redefining and innovating the yield enhancement segment of the structured products market. Swissquote will issue its own structured products under the new product brand “Yield Booster” via Leonteq’s white label platform. The first products have been available as of January 18.
Swissquote confirms record year and strong customer growth
Swissquote’s annual results confirmed that 2021 was a record year. Thanks to strong growth dynamics on the client side, the communicated medium-term profit targets set initially for 2024 were already reached by the end of 2021. Operating revenues increased by 49 percent year-on-year to CHF 479.6 million, while pre-tax profit reached a record high of CHF 223.3 million (target for 2024 was CHF 200 million), an increase of 111.4 percent. Profitability, with a pre-tax profit margin of 47.3 percent, increased strongly thanks to higher trading volumes and more customer accounts (+77’599).
Swissquote welcomes the acceptance of the “La Crétaux” land-use plan
With a majority of 57.5 percent of the votes, the population of Gland has accepted the “La Crétaux” land-use plan. Swissquote is delighted with this result, which will enable it to continue its development at the location where it was founded and to transform its long-established headquarters in line with the growth of its business.
With CHF 5.0 billion in net new monies, Swissquote continues to grow before starting to benefit from higher interest rates
Despite an environment that was more challenging than initially expected, Swissquote continued to grow its overall customer base in the first half of 2022. The opening of around 34’200 new client accounts (of which some 8’000 non-organic) stands out as a positive development. The new accounts resulted in net new monies of CHF 5.0 billion (of which CHF 1.7 billion non-organic). For the first half of 2022, Swissquote recorded net revenues of CHF 200.0 million and a pre-tax profit of CHF 90.7 million (pre-tax margin above 45 percent). As of 30 June 2022, client assets reached CHF 51.8 billion, out of which CHF 9.3 billion allocated in cash. This is a positive sign as it indicates that customers remained invested. With a capital ratio of 25.7 percent, Swissquote is well positioned to benefit from higher market interest rates.
Swissquote launches its own crypto exchange: SQX
With SQX, Swissquote is launching its own centralised trading platform for cryptocurrencies to provide a more competitive and secure trading environment. SQX makes for a significantly enhanced customer experience in the areas of trading, execution and liquidity. In terms of services for institutional clients, SQX also represents an increase in competitiveness when it comes to offering trading and custody services to other banks and brokers.
Swissquote continues national and international expansion
With the establishment of Swissquote Capital Markets in Cyprus, direct access to the Dubai Financial Market and new premises in Zurich-Stettbach, Swissquote is systematically and successfully pursuing its national and international expansion strategy.
Swissquote brings ESG investing to the next level
Invest in what you believe in – Swissquote is launching an innovative way of ESG investing. With the new feature, Swissquote empowers its customers to invest in their true values without compromise. After having launched its own sustainability report and having given its clients the possibility to invest in ESG ETFs and Themes Trading certificates, Swissquote is now upgrading its popular trading platform with a new, comprehensive ESG feature.