20142014 - Hong Kong Monetary Authority

Transcription

ANNUAL REPORT 2014
EDMOND DE ROTHSCHILD (SUISSE) S.A.
Edmond de Rothschild (Suisse) SA
Annual Report 2014
Contents
de Rothschild
5 Edmond
(Suisse) SA
7
8
11
Message
from Baron Benjamin de Rothschild
Message from the Executive Committee
Corporate Governance
39
Group
Financial Report
40
Key figures
41
Report of the Directors
45
Report of the statutory auditor
47
Consolidated subsidiaries
51
Consolidation principles
12
Introduction
53
Valuation policies
13
Group structure and shareholders
54
Consolidated balance sheet
15
Capital structure
56
Consolidated profit and loss account
17
Board of Directors
57
Consolidated cash flow statement
27
Executive Committee
58
Notes to the consolidated
financial statements
33
Remuneration, profit-sharing and loans
34
Shareholders’ rights
36
Take-overs and defensive measures
37
Independent Auditors
38
Information policy
85
Edmond de Rothschild (Suisse) SA,
Geneva
Financial Report
86
Key figures
87
92
94
Balance sheet
96
Profit and loss account
97
Notes to the financial statements
107
115
Pay Report
Addresses
ANNUAL REPORT 2014 |
3
4
| EDMOND DE ROTHSCHILD (SUISSE) SA
7
8
Message
from Baron Benjamin de Rothschild
Message from the Executive Committee
5
6
Message from
Baron Benjamin de Rothschild
Global growth proved disappointing in 2014 contrary to economic projections, particularly in emerging markets. At just
over 3%, it was on a level with the two previous years – demonstrating once again that the road to recovery since the outbreak of the financial crisis in September 2008 is a long one.
The biggest event last year was ultimately the massive drop in
oil prices. On a geopolitical level, this drop had the immediate effect of rebalancing growth prospects between developed economies and emerging economies – a change that is
more structural than it appears. Many large emerging countries suffer from structural imbalances that affect their development and undermine stability. The drop in oil prices has
accelerated this trend. The situation has certainly improved for
importing countries due to lower energy bills, which allow
better control of production costs; however, these countries
have also suffered from the growing trend toward deflation.
Finally, 2014 will be remembered as the year that China became the largest economic power in the world. Of course this
is not a surprise, but the speed with which it happened is
remarkable.
Faced with these major developments, we have chosen to
create a more coherent Group and develop our spirit of conquest – both in areas where we have operated for many years
and in new emerging markets.
And now, for once, I would like to introduce our annual report
by focusing on the future rather than reviewing the past.
In early 2015, I made the decision to further consolidate my
family’s position at the head of the Edmond de Rothschild
Group. In January, the Board of Directors of our Group’s
holding company appointed my wife, Ariane, as Chairwoman
of the Group Executive Committee, reflecting my desire for our
family to play a more direct role in overseeing the Group’s
business. For my part, I will of course remain Chairman of our
Group’s Board of Directors, and I will actively support my wife
and the Group’s teams.
Faced with an uncertain economic environment, increasingly
stringent regulations and fierce competition, my family’s commitment to our Group is deeper than ever before. In the last
three years, we have made great progress towards melding
our banks and financial services into a coherent Group, driven by a common vision, common goals and progressively
common systems.
The challenge we face today is to move beyond organisational factors so that we can return our Group’s focus to its
spirit of conquest. The year 2015 marks a new milestone in
the history of our Group. Our goal is to reconcile what may
seem to be two opposing forces: our passion for entrepreneurship and an environment that places a strong emphasis
on controlling risk. By placing ourselves on the front lines of
executive management, we as a family are demonstrating our
commitment to making ourselves fully accountable for the next
phase of our Group’s development.
Finally, I would like to add that for the first time in the history of
the Rothschild family, the Executive Committee is chaired by a
woman. Few financial institutions are or have been managed
by a woman. I am delighted that Ariane accepted my
proposal.
In 2014, the Group’s business remained buoyant despite a
context of major change. I would like to take this opportunity
to thank every one of the Group’s employees, whose skills are
invaluable. I know I can count on our employees to help build
the robust and innovative group we strive to be and to
position Edmond de Rothschild as a leader in the global financial sector.
Benjamin de Rothschild
Chairman of the Board of Directors
Our decision was the result of careful consideration.
7
Message from
the Executive Committee
Private banking is one of the few sectors of finance that is
growing. It continues to expand worldwide, in line with the
rising number and assets of high and ultra-high net worth
individuals (U/HNWIs), especially in the emerging markets.
But even as the number of U/HNWIs grows in emerging and
newly emerged economies, competition between the world’s
financial centres is also increasing. The products and services
offered by many of these centres are very different from those
provided by traditional private banks.
In fact, the banking universe is becoming ever more complex
and sophisticated and it is changing at an accelerating pace.
Regulations have become increasingly constraining. As a
result of changes in banking secrecy, cross-border rules,
FATCA, the arrival of a MiFID II and the automatic exchange of
information, banks have been forced to rethink their business
model and value proposal.
Finally, new technologies are reshaping the landscape as well,
with the increasing use of paperless communications
between banks and clients and with the digitalisation of
workflows.
In response to all these changes, our Group also has to
enhance its value proposition to clients by offering more
advisory, transparent asset management choices and
performances and clear-cut fees. Moreover, we have to
continue demonstrating our independence and ability to align
our interests with those of our clients, a principle that we know
is greatly valued by our shareholders.
Our Group has already changed considerably to adapt and
thereby build an organisation that is not only in tune with its
environment but also poised to meet future challenges. This
indispensable process has mainly involved transforming our
business model and complying with regulatory requirements.
But it in no way alters the DNA of our Group. Personalised
relations with clients, top-quality investment advisory and a
rock-solid balance sheet remain our foremost concerns.
Another of our priorities lies in bolstering the relevance and
diversity of our offering, which we did in 2014 by developing a
broader array of state-of-the-art services affording greater
differentiation. These range from Multi-strategy Portfolio
Management, Active Advisory and Private Equity to Risk
Management, Corporate Finance and Currency Overlay.
8
When it comes to conviction-based investments, our Group
has pioneered biotechnology investing and economic
development in Africa. Last year our private equity fund
dedicated to financing local small and medium-sized
businesses in Africa raised more than $530 million—a
remarkable feat. Another fund focused on European
infrastructure projects exceeded €430 million at its first closing,
positioning us among the front-runners in this segment. In 2015
we will further tap our spirit of innovation with projects covering
all sectors of the real economy, from technology and healthcare
to infrastructures and emerging markets.
In alternative multimanagement, despite last year’s challenging
conditions we were ranked first worldwide out of 425 fund of
hedge funds management companies. The prestigious
magazine InvestHedge once again honoured the performance
of our fund lines over a 12-year period. We are proud of this
outstanding long-term track record, which rewards the work
and expertise of our fund management teams. Alternative
multimanagement, with its power to diversify risks and reduce
volatility, continues to deserve its place in our portfolios.
Finally, for clients seeking exposure to hard assets, we
recently launched a vehicle that offers the merits of an
investment in physical gold as well as counterparty security.
We also bolstered our real estate offering by acquiring a
majority stake in OROX Asset Management, a Swiss property
fund.
The global economic recovery gained momentum last year,
particularly in the developed countries. The largest of these
registered GDP growth close to their growth potential. In 2015
the United States will remain the world’s main growth engine.
Booming job creation and a general reduction in household
debt will enable American consumers to open up their wallets
further. Wages will start rising soon. By contrast, growth in the
Euro Zone will remain subdued for fundamental reasons.
Crushing public debt and unemployment across the Continent
will continue to siphon off a large portion of wealth creation.
Geopolitical tensions between Russia and the West over the
Ukraine crisis are moreover curbing companies’ capital
investment and exports, particularly in Germany. In China the
economic downturn should not be too severe but it will
nevertheless need to be monitored closely. Beijing is
orchestrating a controlled slowdown as it tries to recast the
country’s economic model. The old formula driven by
competitive yuan depreciation and real estate investment is
being gradually sloughed off and replaced by a new one geared
more towards private consumption. The authorities will try to
apply measured stimulus. It will all be a matter of control.
strives to enhance returns by innovating, broadening the
universe of investable assets and, in a world marked by variable
and unstable relationships between the various asset classes,
by better managing risk in general.
The halving and more of crude oil prices, between June and
December 2014, will give a sizeable boost to GDP growth
worldwide. But on the other hand, it will also depress inflation
rates and in 2015 central banks will have to factor this into their
monetary policies. In the Euro Zone, Japan and even China,
they will have to do more by lowering short-term interest rates, if
that is still possible, and by pumping massive doses of liquidity
into the financial system via asset-purchase programmes. In the
US, after weaning the markets off these injections in 2014, the
Federal Reserve will continue to normalise its monetary policy
during the current year. Expectations of a highly probable rise in
the US federal funds rate are tracked carefully by analysts and
are bound to result in repeated market spasms. The upshot is
that monetary policies will continue to have a powerful impact
on borrowing costs and risk premiums. On the whole, demand
for bonds should remain relatively strong, preventing yields from
rising quickly. The dollar should appreciate further at the
expense of the euro and the yen, in particular.
Given the magnitude of market distortions due to the massive
interventions of central banks, we firmly believe that portfolio
diversification, though necessary, is no longer enough to
mitigate risks. Risk management therefore lies at the heart of
our investment philosophy and our profession as bankers. Our
decades of experience in this area will prove more useful than
ever this year.
The markets’ extreme sensitivity to monetary policies has
buoyed equity benchmarks tremendously in recent years.
Multiples have escalated even though earnings forecasts have
been revised relentlessly downward. The S&P 500, for
example, rocketed 213% between March 2009 and December
2014, whereas the constituent companies’ profits rose only
62% during the same period. If stockmarkets are to keep on
climbing in 2015, earnings will have to improve. If there is one
major risk, it is of an erosion of investor confidence. Trends
have been “disconnected” from fundamentals for several years
now and investors view this situation “complacently”, to borrow
terms used in turn by the Bank for International Settlements and
the US Federal Reserve. More recently, the International
Monetary Fund weighed in, noting investors’ “optimism”.
Modernising a Group such as ours is a long-term project. It is
indispensable in order to serve our clients professionally and
effectively in today’s and tomorrow’s world.
In any event, our portfolio managers have to find ways of
generating sustainable, risk-adjusted returns in an environment
marked by artificially high valuations. The higher asset prices go,
the more difficult it will be to secure strong performances.
Edmond de Rothschild is a unique Group, distinguished by our
shareholder’s
commitment
and
local
management.
Differentiation is our watchword. In the aftermath of the crisis,
the banking industry as a whole committed to reviewing its
model and the size of its players. As has always been the case
and now more than ever, we are convinced that there is a place
for players on a human scale who place client relationships and
impartial investment advisory at the heart of their concerns. We
continue to stand by the values of our shareholders and remain
committed to our fiduciary responsibility vis-à-vis our clients.
At Edmond de Rothschild, we can claim a true legitimacy in our
field, thanks to our name, our history and the values of our
shareholder’s family. By asserting our long-term vision, our
pursuit of performance, our innovative spirit and our social
responsibility, we will succeed in preserving this heritage.
We wish to thank the Group’s shareholders for their patience
and commitment, our teams for the work they perform in a
complex environment and, of course, our clients for their loyalty,
which we will strive to continue to deserve.
The Executive Committee
In this context, preserving and developing our clients’ wealth
remains our fundamental purpose. Our Investment department
9
10
12
13
15
17
27
Introduction
Group structure and shareholders
Capital structure
Board of Directors
Executive Committee
33
34
36
37
38
Remuneration, profit-sharing and loans
Shareholders’ rights
Take-overs and defensive measures
Information policy
11
Introduction
This section of our Annual Report has been drafted in
accordance with the relevant legal and stock exchange
requirements, including the Swiss Code of Obligations (CO)
and Directive on Corporate Governance (DCG) issued by SIX
Swiss Exchange (SIX) on 1 September 2014. It also draws on
the Swiss Code of Best Practice for Corporate Governance
issued by economiesuisse (SECO) on behalf of the Federation
of Swiss Enterprises, as amended in 2014, containing
standards for corporate governance.
The above-mentioned DCG was issued by SIX based on art.
8 of Switzerland’s Stock Exchanges and Securities Trading
Act (SESTA) and articles 1-6 and 49 et seq of SIX’s Listing
Regulations. The DCG mainly apply to issuers incorporated in
Switzerland whose equity securities are traded on SIX. It also
draws on the Ordinance on Excessive Remuneration in Listed
Companies (OER) of 20 November 2013.
The major concerns underlying the above-mentioned
regulations are to limit economic risks, safeguard companies’
reputations and promote responsibility. Corporate governance
is anchored in a set of principles designed to protect
shareholders by ensuring transparency, the issuance of clear
information and a balance at the highest level between the
company’s executives, on the one hand, and its owners, on
the other. At the same time, these principles uphold decisionmaking power and efficiency.
The main information required by the SIX Guidelines is
disclosed in the following pages and in the Remuneration
Report. There are also cross-references to items included
elsewhere in this report, our Bank’s Articles of Association and
Bylaws, which can be found on the Bank’s website:
www.edmond-de-rothschild.ch / About Us / Investor
Relations – Legal Documents.
12
1. Group structure
and shareholders
1.1. Group structure
1.1.1. Presentation of the Group’s operating structure
Board of Directors
Audit Committee
Executive Committee 5)
Chairman
Chairman
Klaus Jenny
Chairman and Chief Executive
Officer
Vice-Chairman
Emmanuel Fievet
Vice-Chairwoman
Jacques-André Reymond
Baroness Benjamin de Rothschild
Members
Secretary
Jean Laurent-Bellue
Maurice Monbaron3)
E. Trevor Salathé
Luca Venturini
Vice-Chairman;
Deputy Chief Executive Officer
in charge of Private Banking
Pay Committee 4)
Sabine Rabald
Chief Administrative Officer
Jean Laurent-Bellue
Members
Luc J. Argand
Veit de Maddalena 1)
Rajna Gibson Brandon 2)
François Hottinger
Klaus Jenny
Maurice Monbaron
E. Trevor Salathé
Chairwoman
Secretary
Jean Laurent-Bellue
Deputy Chief Executive Officers
Members
Yves Aeschlimann
Chief Compliance Officer
Members
Luc J. Argand
Klaus Jenny
E. Trevor Salathé
Nomination Committee 4)
Cynthia Tobiano
Chief Financial Officer
More information on the Board of
Directors and Executive Committee
can be found on pp. 17 et seq. and
30 et seq. of this report.
Chairwoman
Secretary
Internal Audit
Jean Laurent-Bellue
Senior Vice-President
1)
= until 29 April 2014
Members
Jean-Christophe Pernollet 6)
2)
Luc J. Argand
Klaus Jenny
E. Trevor Salathé
Independent Auditor
3)
= from 29 April 2014, replacing Rajna Gibson
Brandon
4)
= As per section 3.2.1.2 al. 4 of the Bylaws
the members of the Promotions Committee are
the same as those of the Pay Committee
PricewaterhouseCoopers SA
5)
= Executive Committee as constituted since
2 October 2014
6)
= From 29 April 2014, replacing François
Maendly.
13
1.1.2. Legal structure of Edmond de Rothschild (Suisse) SA
Edmond de Rothschild (Suisse) SA is a joint-stock company traded on SIX (ISIN CH0001347498 / Security number 134749TK).
Its stockmarket capitalisation at 31.12.2014 was CHF 1.375 billion. It is the only listed Edmond de Rothschild (Suisse) SA Group
company.
1.1.3. Group legal structure
The fully consolidated entities of the Edmond de Rothschild (Suisse) SA group are listed on pp. 47-50 of this report.
1.2. Major shareholders
importants
Major
shareholders
(at 31.12.2014)
Edmond de Rothschild Holding SA (1)
Rothschild Holding AG, Zurich (2)
Par value
Percentage
of share
capital
Percentage
of voting
rights
(in CHF ‘000)
(in %)
(in %)
36,679.5
81.5
86.9
3,800.0
8.4
9.4
(1) The entire share capital of Edmond de Rothschild Holding SA is directly or
24) Christophe Desprez, Paris ; 25) Nicolas Bonnault, Paris ; 26) Laurent
indirectly controlled by members of the de Rothschild family. 17% of the
Baril, Paris ; 27) Philippe Le Bourgeois, Paris ; 28) Maria de Rothschild,
company’s share capital (representing 6.77% of voting rights) is owned by
Paris ; 29) Julia Footnick, Paris ; 30) Elisabeth Donovan, Paris ; 31) James
Baroness Edmond de Rothschild and 66.33% (representing 89.84% of
de Rothschild, Paris ; 32) Anna de Rothschild, Paris ; 33) Pierre de
voting rights) by Baron Benjamin de Rothschild. The financial statements of
Rothschild, Paris ; 34) Alexandra Pécoux, Paris ; 35) Emmanuelle Pécoux,
Edmond de Rothschild Holding SA are available on request in writing to the
Paris ; 36) Maylis Pécoux, Paris (together persons/entities 1), 3) and 13) to
company (PO Box 5254, 1211 Geneva 11).
36) represent the “PO-Group” and together entities and persons 1) to 12)
represent the RCSAS-Group); Rothschild Holding AG, Zurich owns 20,000
(2) Rothschild Holding AG, Zurich is owned by 1) Eric de Rothschild, Paris; 2)
registered shares and 3,600 bearer shares of
Edmond de Rothschild
David de Rothschild, Paris; 3) Alexandre de Rothschild, Paris; 4)
(Suisse) SA, Geneva, representing 8.44% of the total share capital and
Stéphanie Lifford de Buffévent, Paris; 5) Louise de Rothschild, Paris; 6)
9.44% of voting rights.
Financière de Tournon SAS, Paris; 7) Financière de Reux SAS, Paris; 8)
Béro SCA, Paris; 9) Ponthieu Rabelais SAS, Paris; 10) Integritas BV,
RCSAS Group owns a controlling interest in Rothschild Concordia SAS, Paris.
Amsterdam; 11) Rothschild Trust (Schweiz) AG, Zurich; 12) AYRE
The PO Group controls Paris Orléans SCA, which in turn controls Concordia
Corporation (1972) Limited, Amsterdam; 13) Edouard de Rothschild, Paris;
Holding Sàrl, Paris. Concordia Holding Sàrl controls Rothschild Concordia AG,
14) Holding Financier Jean Goujon SAS Paris; 15) Rothschild Concordia
Zug, which in turn owns a controlling stake in Rothschilds Continuation
SAS, Paris; 16) Philippe de Nicolay, Paris; 17) Olivier Pécoux, Paris; 18)
Holdings AG, Zug. Rothschilds Continuation Holdings AG controls Rothschild
François Henrot, Paris; 19) Compagnie Financière Martin-Maurel SA,
Holding AG, Zurich, which owns a direct holding in Edmond de Rothschild
Marseille;
(Suisse) SA, Geneva.
20)
Eranda
Foundation,
UK;
21)
PO
Gestion
SAS, Paris; 22) PO Commandité SAS, Paris 23) CD GFA SARL, Paris ;
Number of
shares owned
1.3. Cross-holdings
Percentage
of share
capital
Percentage
of voting
rights
(in %)
(in %)
12.1
13.8
Cross-holdings
Rothschild Holding AG, Zürich
*Direct and/or indirect holding by the parent company.
14
10,161
2. Capital structure
Par value
2.1. Share capital
Number
of shares
(in CHF ‘000)
Capital
ranking for
dividend
(in CHF ‘000)
Share capital
Fully paid registered shares at CHF 100.– par value
20,000
200,000
20,000
Fully paid bearer shares at CHF 500.– par value
25,000
50,000
25,000
Total share capital
45,000
2.2.
Specific indications regarding
authorised and contingent capital
Edmond de Rothschild (Suisse) SA has no authorised or
contingent capital.
2014
2.3. Changes in share capital
2013
2012
2011
(in CHF ‘000)
Share capital
Fully paid registered shares with a par value of CHF 100.–
20,000
20,000
20,000
20,000
Fully paid bearer shares with a par value of CHF 500.–
25,000
25,000
25,000
25,000
Total share capital
45,000
45,000
45,000
45,000
2.4.
Shares and non-voting certificates
The 200,000 unlisted registered shares with a par value of
CHF 100 and the 50,000 bearer shares with a par value of
CHF 500 listed on the SIX confer the same entitlements in
proportion to their par value, in accordance with art. 7 para. 2
and 3 of our articles of incorporation. The registered and
bearer shares are fully paid up.
Under art. 6 para. 5 and 6 of the articles of incorporation, the
restricted registered shares confer preferential membership
rights: each share, regardless of its par value (art. 15 para. 1),
entitles the owner to one vote at the Annual General Meeting.
Again in respect of membership rights, art. 18 para. 3 of the
Articles of Association provides that each group of shareholders (i.e. the owners of bearer or registered shares) may
demand to be represented on the Board of Directors by at
least one member of its choice.
15
2.5.
Dividend-right certificates
Edmond de Rothschild (Suisse) SA has not issued any
dividend-right certificates.
2.6. Transferability restrictions and
registration of nominees
2.6.3. Eligibility of nominees
There are no percentage clauses or other provisions that
create exceptions from the rules stated in section 2.6.1
(see art. 6 of the Articles of Association) regarding the
registration of nominees.
2.6.4.
2.6.1. Transferability restrictions and provisions
governing dispensations
Under art. 6 para. 5 of the Articles of Association, the
Board of Directors may refuse the transfer of title to or use
of registered shares on valid grounds, having due regard
for either the corporate purpose or the Bank’s desire to
preserve its financial independence and, in particular, its
family character. The Board of Directors may also refuse to
enter shares in the share register if the buyer fails to warrant
in writing that he/she is purchasing the shares in his/her
own name and on his/her own behalf (art. 6, para. 6 of the
Articles of Association). Finally, the Board of Directors may
refuse to enter shares in the share register by offering to
purchase the transferred shares on behalf of the Bank,
other shareholders or third parties, at the shares’ actual
value at the time their registration is requested (art. 6, para.
8 of the Articles of Association).
When registered shares are transferred by succession or
under a matrimonial property settlement or foreclosure, the
Board of Directors may only refuse to enter the shares in
the share register if it offers to buy the relevant shares at
their actual value (art. 6, para. 7 of the Articles of
Association and art. 685b, para. 4 of the CO).
2.6.2. Grounds for granting dispensations during
the reporting year
No dispensations were granted in 2014 and none were
requested.
16
Procedure and conditions for lifting
transferability restrictions
Any amendment to the provisions of the articles of
Association relating to registered share transferability
restrictions (art. 6 of the Articles of Association) must be
approved by a two-thirds majority of the votes represented
at the Annual General Meeting and by an absolute majority
of the par value of the shares represented (art. 15 para. 6
of the Articles of Association and art. 704 para. 1 of the
Swiss Code of Obligations).
2.7.
Convertible bonds and options
Edmond de Rothschild (Suisse) SA has not issued any
convertible bonds or options.
3. Board of Directors
3.1. Members of the Board of Directors
The Board of Directors is made up of 10 1) members, who in
accordance with industry practice do not exercise an
executive function within the Bank. Notwithstanding this, some
of them do exercise managerial duties within the Group, or did
so in the past.
Chairman, French, 1963
Vice-Chairwoman, French, 1965
Education / training
Education/training
1984
1984
1988
1990
Master in Business and Management,
Peperdine University, California (US)
Career summary
1985
1985-1987
BP, London
LCF Rothschild Group, Geneva and Paris
(now the Edmond de Rothschild Group)
1989
Fondation de la Compagnie Benjamin de Rothschild
– Chairman
A-levels, Kinshasa (Zaïre) – Nantes Academy
BBA in Finance, Pace University, New York
MBA in Financial Management, Pace University, New York
Career summary
1988-1990 Financial analyst, then currency dealer at Société Générale,
Australia and New York
1990-1995 Currency dealer at AIG, New York. Helped launch Paris
subsidiary and developed business in Europe
Present duties
Directorships
Since 1997
Chairwoman of:
Chairman of the Edmond de Rothschild Group
Directorships
Chairman of:
— Edmond de Rothschild Holding SA (Switzerland)
— Holding Benjamin et Edmond de Rothschild, Pregny SA
(Switzerland)
—
—
Edmond de Rothschild (Europe)
—
Edmond de Rothschild Asset Management (Suisse) SA
(Switzerland)
— The Caesarea Edmond Benjamin de Rothschild Development
Corporation Ltd (Israel)
— The Edmond de Rothschild Foundation (USA)
— Edmond de Rothschild (France)
Director of:
—
La Compagnie Fermière Benjamin et Edmond de Rothschild SA
—
La Compagnie Vinicole Baron Edmond de Rothschild SA
—
Rothschild Continuation Holdings A.G. (Switzerland)
—
La Compagnie Générale Immobilière de France (Cogifrance)
—
EBR Ventures
—
EDR Communication
—
Administration et Gestion SA
Vice-Chairwoman of:
— Edmond de Rothschild Holding SA (Switzerland)
— Edmond de Rothschild SA
— Edmond de Rothschild (Suisse) SA
—
Edmond de Rothschild (Europe) (Luxembourg)
—
OPEJ
Vice-Chairwoman of the Supervisory Board of Société Française des
Hôtels de Montagne (S.F.H.M.)
Honorary Vice-Chairwoman of RIT Capital Partners (London)
Director of:
— Holding Benjamin et Edmond de Rothschild, Pregny SA
(Switzerland)
— Baron et Baronne Associés (holding company of SCBA
Société Champenoise des Barons Associés)
— Edmond de Rothschild (France)
Member of Supervisory Board of:
Chairman of the Supervisory Board of Société Française des Hôtels de
Montagne (SFHM)
—
SIACI Saint-Honoré
—
Milestone
Member of the Supervisory Board of Les Domaines Barons de Rothschild
(Lafite)
1)
= at 31 December 2014
17
Jean Laurent-Bellue
Luc J. Argand
Secretary, French, 1951
Member, Swiss, 1948
1974
1975
1977
1968
1968-1972
1972
1972-1974
1974
1976
Institut d’Études Politiques de Paris
Licences in Literature and Law
MBA from the Hautes Etudes Commerciales
Career summary
1978-1980
1980-1987
Executive with the Compagnie du Midi Group
Institut de Développement Industriel (IDI), first as a budget
controller and later in charge of marshalling equity
1987-1999
Board of CFF
London (Charterhouse Bank)
- 1998-1999: responsible for private equity in Paris and
London (Charterhouse Development Capital)
Member of the Executive Board of Crédit Lyonnais Group
LCF Edmond de Rothschild Group (now Edmond de
Rothschild Group) as a member of the Executive Board of
La Compagnie Financière Edmond de Rothschild Banque
and Chairman of the Executive Board of Edmond de
Rothschild Corporate Finance
Secretary-General of the Executive Board of Compagnie
Financière Saint Honoré and Chairman of the Board of
Directors of Edmond de Rothschild Corporate Finance
Present duties
Group Secretary-General at Edmond de Rothschild
Holding SA, Geneva
Member of the Board of Directors of Edmond de
Rothschild (Suisse) SA and Member of the Supervisory
Board of EDR SA, Paris
Other Offices
Director and member of the Supervisory Board of KPMG
Associés
Since 2005
Director and member of the Supervisory Board of KPMG
SA and KPMG Associés (SA)
Since 2008
Member of the Supervisory Board of
Edmond de Rothschild Private Equity Partners
18
Admitted to the Geneva Bar
MBA, INSEAD
1977-1981
- 1994-1998: in charge of corporate finance in Paris and
Since 1999
Articled at Antoine Hafner Solicitors
Various duties with the Crédit Commercial de France
- 1993: Central Manager and a member of the Executive
Since
Jan. 2011
LLM, University of Geneva
Career summary and Present duties
- 1987-1999: CEO of Nobel, in charge of investments
2009-2011
University of Geneva
investments and managing the portfolio of holdings
Group relating to corporate finance and private equity:
2000-2004
2004
Diploma in Classical Studies, Collège Calvin (Geneva)
Trained at La Compagnie Financière Benjamin & Edmond
de Rothschild; Goldman Sachs, New York; NMR, London
Worked for Edmond de Rothschild (Suisse) SA, Geneva
1982-present Partner of Pfyffer & Associés Solicitors, Geneva
Since 1986 Director of Banque Morval SA, Geneva
1993-present Director of Edmond de Rothschild (Suisse) SA, Geneva
Director of Edmond de Rothschild Asset Management
(Suisse) SA, Geneva Director of Benjamin and Edmond de
Rothschild , Pregny SA (Switzerland)
1996-1998 President of the Geneva Bar Association
1996-1998
President of the Geneva Bar Association
1990-present Arbitrator for the Court of Arbitration for Sport, Lausanne
1998-2007 Member of the Geneva Magistrates’ Upper Council
2004-present Member of the Geneva Notaries’ Supervisory Commission
2005-2011 President of the Geneva Auto Show
Since 2007 Director of Banque Syz & Co SA, Geneva
Veit de Maddalena 1)
François Hottinger
Member, Swiss, 1967
Member, Swiss, 1943
Rajna Gibson Brandon
2)
Member, Swiss, 1962
1982
Licence in Commercial and Industrial Sciences (Business
administration), University of Geneva
1987
PhD, summa cum laude, Economic and Social Sciences
(Specialization in Finance), University of Geneva
Academic experience
1991-2000
1993-1997
Professor of finance at HEC, University of Lausanne
Director of the Master’s programme in Banking and
Finance at HEC, University of Lausanne
2000-2008
Professor of Finance at the Swiss Banking Institute,
1965
French Banking Association courses at the Sorbonne
1966-1967
1967-1968
Trained at BNP (ex BNCI), Paris
Hottinguer & Cie, Paris
1968
Director and Assistant Director of the National Centre
1969-1992
1975-1990
1992-2008
1995-2008
2009-2012
Since 1970
Since 1992
Since 1992
Risk Management (FINRISK)
Research Director at the Swiss Finance Institute (SFI)
Professor of Finance at the University of Geneva
Managing partner of Banque Hottinger & Cie, Zurich
Managing partner of Banque Hottinguer & Cie, Paris
Managing partner of J.F.E. Hottinger & Co, Zurich
Director of Banque Hugo Kahn AG, Zurich
Limited partner of J.C.E. Hottinger & Co., Zurich
Present duties
of Competence in Research, Financial Valuation and
Since 2006
Since 2008
Trained at Baring Bros, London
Career summary
University of Zurich
Since 2001
Trained in the commercial banking department of Banque
Since 2010
Since 2012
Director of Edmond de Rothschild (Suisse) SA, Geneva
Director of Hottinguer Corporate Finance SA, Paris
(formerly Jean-Philippe Hottinguer & Cie, Corporate
Finance SA, Paris)
Director of Messieurs Hottinguer Gestion Privée SA, Paris
(formerly Jean-Philippe Hottinguer & Cie, Gestion Privée
SA, Paris)
Director of Bolux Sicav, Luxembourg
Director of J.C.E. Hottinger AG, Zurich
and Chairholder at the Swiss Finance Institute
Since 2009
Director of Geneva Finance Research Institute, University
of Geneva
Regulatory bodies
1995-1996
1997-2004
Member of the Swiss Takeovers Board
Member of the Swiss Federal Banking Commission
Directorship
Since 2000
Since 2012
Director of Swiss Re
Director of Edmond de Rothschild (Suisse) SA
1) = position held until 29 April 2014
His/her personal data can be found in previous annual reports available
on the Bank’s website: www.edmond-de-rothschild.ch, under the
heading “About Us / Library / Annual Reports”.
2) = until 29 April 2015
19
Klaus Jenny
Maurice Monbaron
Member, Swiss, 1942
Member, Swiss, 1946
1967
1965
1965-1966
1968
M. Sc. in Economics (major in banking), University of
Saint Gallen)
1973
1975
1986
Ph. D. in Economics, University of Saint Gallen)
LLM, Glaris Canton
Program for Senior Executives, Massachusetts Institute
1972
of Technology
Career summary
1972 à 1998 Credit Suisse / Credit Suisse Group from 1987
Member of the Executive Board
Member of the Executive Board Committee Member
Executive Board of Credit Suisse Group CEO of Credit
Suisse Private Banking
Since 1999 Self-employed financial consultant for companies,
institutions and private clients
Career summary
1972-1988
Deputy to Geneva Branch Manager, Basel Branch
Manager, Geneva Branch Manager
1988-1990
Deputy CEO of TDB American Express Bank, Geneva
and a member of the Executive Board
1990-2005
Crédit Lyonnais (Suisse) SA, Deputy CEO and from
1992 CEO. From 1996, Head of International Private
Banking for the Crédit Lyonnais Group
Maus Frères SA
Téléverbier SA
Present duties
Assivalor SA
Since 2005
Edmond de Rothschild Holding SA
Vice-Chairman of the Board of Directors of Crédit
Agricole (Suisse) SA
Since 2009
(Various other directorships for smaller companies and
Vice-Chairman of the Board of Directors of the
International Centre for Monetary and Banking Studies,
assignments for boards of charitable foundations)
Since 2014
American Express Bank (Switzerland) AG, credit analyst
and commercial banking employee in Zurich,
Directorships
Since 2000
Since 2001
Since 2009
Since 2009
Since 2010
Diploma from the Neuchâtel Business School
Sales representative for Montres Cortébert, Biel
Baccalauréat in Commerce,
Collège de Fribourg
Licence in Management Studies (HEC), University of
Lausanne
Geneva
Lombard Odier SCA
Since 2013
Member of the Supervisory Board
Trade associations
1992-2013
Director of Edmond de Rothschild (Suisse) SA, Geneva
Director of the France-Swiss Chamber of Commerce
and lndustry and, since 2008, Chairman of the Board
2002-2011
Director of the Association of Foreign Banks in
Switzerland and, since 2006, Vice-Chairman of the
Board
2006-2011
20
Director of the Swiss Bankers Association
E. Trevor Salathé
Member, Swiss, 1937
Member, Swiss and British, 1925
1959
1962
1963
Master’s in Commerce, University of Geneva
1946
1948
Degree from the Institute of Comparative Law, New York
Career summary, present duties and directorships
University
1966
1973
Ph. D. in Law, University of Geneva
Career summary
1964-1965
1965-1966
1966-1968
1968-1996
Articled at Shearman & Sterling, New York
Articled at Helg, Picot, Grandjean, Geneva
Worked for Lenz Solicitors
Worked for and in 1972 became a partner of Sandoz,
Mayor, Moreillon & Reymond Solicitors
1974-1998
Professor of commercial and tax law at the Faculty of Law,
University of Geneva, Dean from 1989 to 1993
Present duties
Solicitor, honorary professor at the University of Geneva,
1946–1948
Trainee with Martin Achard et Haissly,
a Geneva law firm
1949–1953
1954–1959
1959–2000
Practising attorney in Geneva
Executive Assistant, Société Bancaire de Genève
Managing Director of Banque Privée SA, which became
Edmond de Rothschild (Suisse) SA, Geneva
Current directorships
Edmond de Rothschild Holding SA, Geneva
Edmond de Rothschild Asset Management (Switzerland)SA, Geneva
Edmond de Rothschild (Switzerland) Europe, Luxembourg
Banque de Gestion Edmond de Rothschild, Monaco
Edmond de Rothschild Gestion, Monaco
member of the Board of Directors of Edmond de
Rothschild (Suisse) SA, member of the Board of Directors
of Edmond de Rothschild Holding SA, and
Vice-Chairman of the Audit Committee of Edmond de
Rothschild (Suisse) SA
None of the Directors had a close business relationship with
Edmond de Rothschild (Suisse) SA or with a Group company.
21
3.2. Other activities and vested interests
To find out the other activities and interests of Board
members, please refer to their personal data in section 3.1.
The following table provides details of the length of Board
members’ current terms:
Directors
Member of the Board
Term ends
since
We also point out that Luc J. Argand is Chairman of the
Geneva Notaries’ Supervisory Commission.
3.3. Provisions relating to the number of
positions that may be held under
art. 12 para. 1 ch. 1 of OER
As required by art. 12 para. 1 ch. 1 of OER, the Board of
Directors of Edmond de Rothschild (Suisse) SA will propose
an amendment to the Articles of Association at the 2015
General Meeting providing for the addition of an art. 19quater
concerning the maximum number of offices that Directors may
hold in other companies and organisations.
The proposed wording will appear in the agenda of the
General Meeting of Edmond de Rothschild (Suisse) SA to be
published on 1 April 2015 in the FOSC.
3.4. Elections and terms of office
Pursuant to OER, which came into force on 1 January 2014,
the Chair (art. 9 ch. 3 of the Articles of Association) and
members of the Board of Directors (art. 9 ch. 2 of the Articles
of Association) are elected by individual ballot at the General
Meeting. Their term of office is one year, regardless of their
age, and ends at the conclusion of the next ordinary General
Meeting after their election (art. 19bis of the Articles of
Association). They may however be re-elected.
In accordance with the law, the Bank also provides in its
revised Articles of Association that the members of the Pay
Committee and the Independent Proxy be elected by
individual ballot each year for a one-year term, like the Chair
and the members of Board of Directors.
The average age of the Directors is currently 67.
22
1985
2015
2009
2015
* M. Jean Laurent-Bellue
2011
2015
* M. Luc J. Argand
1993
2015
* Mme Rajna Gibson Brandon
2012
2015
* M. François Hottinger
1970
2015
* M. Klaus Jenny
2010
2015
* M. Maurice Monbaron
2013
2015
* M. Jacques-André Reymond
1996
2015
* M. E. Trevor Salathé
1959
2015
* Fulfil the independence requirements provided in FINMA circular 08/24
“Supervision and internal control - banks”.
3.4. Organisational structure
Board of Directors
The current version of the Bank’s Bylaws provide inter alia as
follows:
1. In addition to its wealth management and securities
dealing core business, the Bank operates as the parent
company of a banking and financial group as defined in
Swiss legislation and rules on banking. As a result, the
duties and powers of the Bank’s governing bodies have
increased (art. 2.1. of the Bylaws);
2. The Bylaws and Articles of Association state the required
level of skills, experience, diligence, availability, loyalty and
independence for each governing body (art. 1.4., 3 and 4
of the Bylaws and art. 18 to 23bis of the Articles of
Association);
3. The Bank points out that the members of its governing
bodies must organise their personal and work relationships
so as to avoid as much as possible any conflict of
interests with the Bank and the banking and financial
group of which it is the parent company (art. 3.1.1.7.,
3.2.1.6., 3.3.1.6. and 3.4.1.5 of the Bylaws);
4. Both for itself and for the banking and financial group of
which it is the parent company, the Bank broadens the
duties and reinforces the powers of the Audit Committee
(art. 3.3.2. of the Bylaws) and the Internal Auditors (art. 4
of the Bylaws), as well as of the Compliance Office and
Risk Management Department (art. 3.1.2. of the Bylaws);
If the Chair and/or Vice-Chair of the Executive Committee
hesitate to deem a matter as falling within the Executive
Committee’s jurisdiction, they must submit the issue to the
Chair of the Board of Directors, who shall decide whether the
matter should be handled by the Executive Committee or the
Board.
5. The Bank consolidates the systems used for internal
monitoring, information management, reporting (art. 3.4.2.
of the Bylaws) and risk management (art. 3.1.2 of the
Bylaws);
If the Chair is absent, his/her duties shall be exercised by the
Vice-Chair of the Board or, failing this, by the oldest member.
6. The Board of Directors sets the credit-granting powers
assigned to the governing bodies, the Credit Committee,
the head of the Credit Department and his/her
subordinates.
3.5.1. Breakdown of tasks within the Board of
Directors
The Board of Directors, made up of 10 members, is chaired
by Baron Benjamin de Rothschild. Since 26 April 2012,
Baroness Benjamin de Rothschild and Jean Laurent-Bellue
respectively hold the offices of Vice-Chairman and Secretary.
The Board of Directors operates as a collegial body (art.
3.1.1.3 of the Bylaws and art. 20 of the Articles of
Association). Resolutions are passed by an absolute majority
of the directors present and in the event of a tie, the Chairman
has the casting vote. In special circumstances Board
resolutions may be passed by circular as prescribed in the
Bylaws.
The Chair of the Board shall have the rights and prerogatives
provided in the law, the Articles of Association and these
Bylaws (art. 3.1.1.9. of the Bylaws).
The Chair must be informed regularly by the Chair or ViceChair of the Executive Committee on business development
and the situation of the Bank and its subsidiaries.
3.5.2. Composition, powers and limitation of powers
of the Board’s committees
In accordance with the Bank’s Articles of Association and
Bylaws, the Board of Directors is empowered to set up
supervisory committees composed of its members. It has
created an Audit Committee, a Pay Committee and a
Promotions Committee.
Audit Committee
Under the Bylaws the Board of Directors has delegated part of
its powers to an Audit Committee made up of at least three
Board members. Their powers primarily include acting as a
liaison unit between the Independent Auditors and the Board
of Directors and supervising the activities of the Internal
Auditors, the Compliance Office and the Risk Management
Department. The Board has appointed five of its members
(Klaus Jenny as Chairman, Jacques-André Reymond as ViceChairman, Maurice Monbaron1), Jean Laurent-Bellue and E.
Trevor Salathé) to form the Audit Committee. Fabienne
Thionnet-Chevrier, Corporate-Affairs attorney and head of
Corporate Governance was appointed non-member
Secretary.
Most of these members meet the requirements regarding
independence and all have the necessary skills and
experience.
1)
= Since 29 April 2014 in replacement of Rajna Gibson Brandon
23
Pay Committee and Promotions Committee
3.5.3 Working procedures of the Board of Directors
Under the Bylaws, the Board of Directors has delegated some
of its powers to the Pay Committee, which must comprise at
least three Directors. The powers of the Pay Committee
include (i) drawing up regulations on remuneration; (ii)
approving the overall pay package and level of bonuses for
the Bank’s staff; (iii) after consulting the CEO, submitting
proposals to the Board of Directors regarding the
remuneration of the members of the Executive Committee;
and (iv) submitting proposals to the Board of Directors
regarding the remuneration of the Directors for the tasks they
perform in this capacity and as members of the Board’s
committees. Proposals relating to the remuneration referred to
in subsections (iii) and (iv) shall be decided by the Board of
Directors and then submitted to the General Meeting for
approval (art. 9 ch. 6 and 7 of the Articles of Association).
The Board of Directors meets periodically and holds
extraordinary meetings if necessary. In 2014 it met seven
times. On average Board meetings last half a day. The Board
of Directors works on the basis of files prepared by its
secretariat and the Chair of the Executive Committee. Minutes
are taken at Board meetings. They must be duly numbered
and signed jointly by the Chair and the Secretary. The
meetings follow a set agenda that mainly covers the following
items:
The Board of Directors has appointed five of its members to
form the Pay Committee: Baroness Benjamin de Rothschild
(Chairwoman), Jean Laurent-Bellue (Secretary), Luc J.
Argand, Klaus Jenny and E. Trevor Salathé. This Committee
holds meetings at least twice a year.
The Promotions Committee is responsible for submitting a
preliminary opinion to the Board of Directors regarding the
appointment and removal of Directors, members of the
Executive Committee and persons in charge of managing and
representing the Bank.
The composition of the Promotions Committee is the same as
that of the Pay Committee (art. 3.2.1.2 of the Bylaws).
The preparatory, advisory and decision-making powers of the
aforementioned Committees appear in the Bylaws and the
Articles of Association.
24
1. Reading and approval of the minutes of the last meeting;
2. Word by the Chair of the Board of Directors;
3. Report of the CEO;
4. Report of the CFO;
5. Report of the CAO;
6. Report of the Head of Legal & Compliance;
7. Report of the Audit Committee;
8. Report of the Pay Committee;
9. Words by independent Directors;
10. Any other business
3.6. Powers
The Board of Directors is the Bank’s highest governing body
and is responsible for supervising and monitoring its
operations. Under the statutes and the Articles of Association,
it has the widest powers of oversight as regards how the
Bank’s business is managed.
The Board has inter alia the inalienable and non-transferrable
powers stated in art. 22 of the Articles of Association, namely
to do the following:
a) Examine and prepare proposals to be submitted to the
General Meeting and execute its resolutions;
b) Issue the necessary instructions and organisational
regulations regarding the Bank’s management and
delineate the powers of the various governing bodies;
c) Pass resolutions on all matters which, under the Bylaws,
fall within the jurisdiction of the Board of Directors;
d) Appoint and remove members of the Executive Committee
and persons in charge of managing and representing the
Bank;
e) Appoint the independent auditors required by the Banking
Act;
f) Set the Bank’s accounting and financial control principles
and draw up the financial plan and financial report;
g) Examine the reports of the independent auditors;
h) Decide on all matters which, under the law and the Articles
of Association, are not the responsibility of the General
Meeting or any other governing body;
i) Oversee the persons in charge of managing the Bank to
ensure, inter alia, that they abide by the law, the Articles of
Association, applicable regulations and instructions that
have been given;
j) Inform the judicial authorities if the Bank’s exceeds the
prescribed debt limits;
k) Draw up the Pay Report.
In addition to exercising the powers set out in art. 22 of the
Articles of Association, the Board of Directors may decide on
all matters assigned to it in art. 3.1.2 of the Bylaws.
Aided by its committees, it sets the general strategy of the
Bank and Group. It lays down the principles pertaining to
organisation, management and control and ensures that they
are applied. It supervises on a consolidated basis all the
Swiss and foreign entities that together comprise the Edmond
de Rothschild (Switzerland) Group. The Board of Directors has
delegated oversight of the Bank’s day-to-day business to the
Executive Committee (see section 4 below).
The Board of Directors has no official terms of reference. Its
powers and those of its Committees are clearly delineated in
the Bank’s Articles of Association and Bylaws (www.edmondde-rothschild.ch, About Us/Investor Relations/ Legal
Documents), which will be amended in 2014 to meet the
requirements of the OEPLC.
3.7. Information and control instruments
Description of reporting by the Executive Committee
At each meeting of the Board of Directors, the Chief Executive
Officer and/or the Deputy Chief Executive Officers report on
the major decisions taken by the Executive Committee and on
the operations dealt with, presenting those matters that fall
within the jurisdiction of the Board of Directors. However, the
Chief Executive Officer and his Deputies may only participate
in Board meetings in an advisory capacity.
To help them perform their oversight obligations, at each
meeting the members of the Board of Directors are given
among other documents a monthly progress report including
mainly comments by the CEO, the summarised accounts of
the various Group entities comparing actual business
performance with the budget and, finally, a list of the Group’s
financial investments and holdings.
At meetings the Board members also receive a quarterly
report on risks noting, inter alia: the level of shareholders’
equity; major risks, if any; market, interest rate and counterparty risks in the banking industry; the level of cash reserves;
and risks of a legal and reputational nature.
The Board of Directors has also put facilities in place that are
designed to monitor and supervise management at the Group
level. These facilities are outlined on pp. 58 et seq. of this
annual report.
Between meetings of the Board of Directors and the Board
Committee, the Chairman and Deputy Chairmen of the
Executive Committee keep the Chairman of the Board of
Directors regularly informed on major executive decisions.
25
Other members of the Executive Committee, as well as other
Bank executives, employees, internal auditors and external
advisers or experts whose presence is needed, may also be
invited to the meetings of the Board of Directors and the
Board Committee. However, these persons may only
participate in an advisory capacity.
Description of the internal auditing system
Pursuant to the applicable regulations and laws (art. 9 para. 4
of AMLO, art. 20 para. 2 of SESTO, sections 9 and 54 et seq
of FINMA Circ. 08/24), the Board of Directors has an Internal
Audit Department that reports directly to it in the chain of
command. The chief internal auditor and his assistant are
appointed by the Board on the advice of the Board
Committee, to which they report directly. The rights and
obligations of the Internal Auditing Department are set out in
the Bank’s Bylaws and in the internal auditors’ Charter. In
particular, the Internal Auditing Department has access to all
the documents of the Bank and of the consolidated affiliates
that it audits.
The Internal Auditing Department currently has a staff of 13.
It draws up an auditing programme each year that is
discussed and approved by the Audit Committee. In addition
to a detailed list of assignments planned for the current year,
this programme contains a summary of the departments and
functions that have been audited over the past three years
and of those for which a review is scheduled in the three
coming years.
26
This programme is also discussed with the Independent
Auditors.
A separate report is drafted for each area audited. The
Executive Committee’s view on each item is included in the
report, along with a deadline for implementing the
recommended steps. At its meetings the Audit Committee
deals with the Internal Auditing Department’s reports in the
presence of the chief internal auditor and resolves to take
additional measures when necessary. The Chief Internal
Auditor is asked to attend the meetings of the Audit
Committee and even in some cases to meetings of the Board
of Directors. In certain circumstances the Chairman of the
Board of Directors or of the Audit Committee may assign
special tasks to the Chief Internal Auditor.
The Independent Auditors draw up an auditing plan for each
financial year and submit it to the Audit Committee for
discussion and implementation. The 2014 auditing plan was
presented to the Board Committee at its meeting on
27 August 2014. The Audit Committee meets regularly with
representatives of the Independent Auditors.
Description of the risk control and management
system
Please refer to pp. 58-61 of the “Notes to the consolidated
financial statements”.
4. Executive Committee
The Executive Committee is comprised of five 1) members
appointed by the Board of Directors and operates as a
collegial body, holding weekly meetings that on average last
half a day. In 2014 it met 35 times. Resolutions are passed by
an absolute majority of the members present, provided they
form a quorum. In the event of a tie, the Chairman has the
casting vote. The Executive Committee’s resolutions may also
be passed by circular as prescribed in the Bylaws. Minutes
are taken at the meetings of the Executive Committee; they
are duly numbered and signed by the Secretary. Each
meeting follows a standing agenda that covers the full range
of the Bank’s operations.
Each of the Bank’s departments is placed under the
supervision of a member of the Executive Committee. After
each meeting these members inform their staff on any major
developments that have occurred in their area of
responsibility.
The Executive Committee has set up the following
committees: an Extended Executive Committee; a Private
Banking
Management
Committee;
an
Operational
Management Committee; a Private Banking Supervision
Committee (Asset Management Division); an Asset Allocation
Strategy Committee; an Administrative and Operational
Committee (Asset Management Division); a Compliance
Committee; a Risks Committee; a Credit Committee; an
Asset- and a Private Banking Committee.
Minutes are taken at the meetings of these committees. They
are numbered, dated and signed, and a copy is remitted to
each member of the Executive Committee.
Other Bank executives, as well as employees, internal
auditors and external advisers or experts may also be invited
to the meetings of the Executive Committee. However, these
persons may only participate in an advisory capacity.
The members of the Executive Committee receive documents
and statistics issued weekly, monthly or quarterly by the
departments and groups concerned. These include
summarised monthly accounts comparing actual business
performance with the budget, the financial statements of the
various entities forming the Edmond de Rothschild (Suisse) SA
Group, a report on risk control noting market, interest rate and
counterparty risks, the level of shareholders’ equity and risks
of a legal and reputational nature (cf. compliance). The
Executive Committee can also rely on the supervision and
monitoring facilities described in section 3.7 above. These
facilities are honed year after year to enhance their
effectiveness.
1)
= at 31 December 2014
27
4.1. Members of the Executive Committee
Emmanuel Fievet
Luca Venturini
Chairman, Belgian, 1969
Chief Executive Officer
Deputy Chief Executive Officer, Italian, 1968
Head of Private Banking
1993
1997
Master in Marketing & Management
1999
Middlesex University Business School – London
Passed Bar Exam (Solicitor) Appellate Court Milan, Italy
B.S. in applied economics
Université Catholique de Louvain
Career summary
1994-2000
2000-2005
2005-2008
Vice-President JP Morgan-London, EMEA Region
Career Summary
Christophe de Backer 1)
1994 - 1995 Foreign Markets Marketing Manager for ‘Sico Italiana S.r.l.’,
Tradate (Italy)
1996 - 1998 Legal Practitioner at Studio Muscolo (Law Firm), Milan (Italy)
1998 - 2003 Controlfida (Suisse) SA - Lugano (Switzerland)
Member of the Board of Directors
Chief Legal Officer
2001 – 2003 Controlfida Management Company Ltd (Ireland)
Member of the Board of Directors
Chief Legal Officer
2003 – 2003 Controlfida (Suisse) SA – Lugano (Switzerland)
Controlfida Management Company Ltd – Dublin (Ireland)
Chief Legal Officer
2003 – 2003 Camperio SpA SIM – Milan (Italy)
Controller
2003 - 2005 Protrust Financial Services Group SA (Switzerland)
Operations Director
2005 - 2007 Credit Suisse Private Banking (Switzerland)
Senior Vice President - Lugano
2007 - 2011 Banca Sarasin & C. Ltd - Lugano (Switzerland)
Branch Manager & Head of Private Banking
2011 - 2014 Edmond de Rothschild-(Lugano) SA (Switzerland)
Presidente del Collegio di Direzione
Head of Private Banking
Chairman, French, 1962
Chief Executive Officer
Manuel Leuthold
Managing Director Citigroup London, EMEA Region
Managing Director UBS Wealth Management, London UK
Domestic
2008-2014
Managing Director Barclays Wealth and Investment
Management, London/Geneva, EMEA &UK Markets
Present duties
Since
CEO Edmond de Rothschild (Suisse) SA, Head of
1 May 2014
Private Banking International and member of the Edmond
Since
Chairman of the Private Banking International Committee
de Rothschild Group Executive Committee
13 Jan. 2014
Directorships
Since 30 June 2014
Chairman of the Board of Edmond de Rothschild
Israel LTD
Since 27 Oct.2014
Director of Edmond de Rothschild (UK) Limited
Since 12 Nov. 2014
Director of Edmond de Rothschild (Europe)
Since 1 Dec. 2014
Director of Edmond de Rothschild Private Equity,
Luxembourg
1)
Vice-Chairman, Switzerland, 1959
1)
2)
= until 31 July 2014
Their personal data can be consulted in our previous annual reports on
the Bank’s website www.edmond-de-rothschild.ch, under the heading
“About Us/ Library/ Annual Reports”.
28
Hervé de Montlivault
2)
Member, French, 1955
Deputy Chief Executive Officer in charge of Private Banking
Sabine Rabald
Yves Aeschlimann
Swiss, 1969
Member, Switzerland, 1967
1986-1989
1993
1996
Commercial apprenticeship, Federal Certificate of Capacity
in business - Société de Banque Suisse, Geneva
Admitted to the Geneva Bar Association
Career summary
Career summary
1990-1995
1996-1999
1999-2000
2001-2009
Cash management (one year)
Société de Banque Suisse, Geneva
Back office derivative currencies (two years) and Middle
office
Société de Banque Suisse, Zurich
Edmond de Rothschild Asset Management
(Suisse) SA
1995-1997
1998-2007
2007-2013
2014
Back-office employee
Head of Back office and Control
Control and Compliance
Clerk, Canton of Geneva High Court
Investigating Magistrate, Canton of Geneva Criminal
Justice Department
2010-2012
Back office derivative securities (two years)
1995-2014
Practising attorney in Geneva
Senior Financial Sector Specialist in Financial Market
Integrity for the World Bank, Washington DC
Present duties
Since 2013
Senior Vice-President, Head of Group Compliance and
Legal and member of the Executive Committee of
Directorship
Chairwoman of the Administration, Control and
Director of Edmond de Rothschild (Bahamas) Ltd. (Nassau)
Compliance Department
Present duties
Since Oct. 2014 Deputy Chief Executive Officer, CAO
29
Cynthia Tobiano
Marc-Henri Balma
Member, French, 1976
Member, Swiss, 1962
Head of Operations
1994-1996
Private preparatory institute for higher teaching exams
1993-1994
1996-2000
MBA, Ecole Supérieure des sciences économiques et
commerciales de Paris (ESSEC)
1998
CS International Bankers School, New York, Logistics and
Operations Program (eight months), Diploma
1990-1993
Brandeis University, Boston
Centre de Perfectionnement des cadres, Geneva
(CPCG)Diploma
Career Summary
Career summary
2000-2003
Goldman Sachs, London, M&A team-analyst
1983-1987
2003-2006
Goldman Sachs, Paris, Associate, M&A team
2006-2011
Goldman Sachs London/Paris Vice-President M&A team
2011-2013
Edmond de Rothschild (France), CFO and Head of
(Suisse) SA, CFO and Member of the Executive Committee
Directorships
JP Morgan (Suisse) SA, Geneva
Vice-President, Middle-office manager (Private banking) for
Europe and Asia
1999-2001
Since 2013 Edmond de Rothschild Group and Edmond de Rothschild
Credit Suisse, Geneva
Back-office Securities
1997-1999
Development
Present duties
5)
Banque Labouchère (Suisse) SA, Deputy CEO, member of
the Executive Committee, Head of Back office
2001
Société Financière Privée SA, Geneva
Senior Vice-President, CAO, Head of Back office
2002-2003
EDRPEP (Holding company for EdR’s private equity stakes),
Independent consultant, organisation mandates for a
Spanish bank in Geneva and Sungard Investment
Edmond de Rothschild UK,
Systems, vendor of ApsysIII
Edmond de Rothschild Israel,
2003-2007
CFSH Luxembourg Sàrl and
Union Bancaire Privée, Geneva
Member of the Senior management
Edmond de Rothschild Real Estate
Head of Transaction processing
Present duties
Since 2008
Frédéric Binggeli
Head of Securities and Cash Administration, the Central
Register and General Services
3)
Member, Swiss, 1961
Alexandre Col
4)
Member, French and Swiss, 1963
3)
4)
= until 30 May 2014
His/Her personal data can be consulted in our previous annual reports on
the Bank’s website www.edmond-de-rothschild.ch, under the heading
“About Us/ Library/ Annual Reports”.
5)
30
= Member from 1 May 2014 to 1 October 2014
Jérôme Moser
5)
Alessandra Gaudio
5)
Member, Swiss, 1975
Head of Risks
Member, Italian, 1965
CIO Group and CIO Switzerland
1992-1995 Banking apprenticeship, Société de Banque Suisse, Fribourg
1998
San Diego State University Exchange Program
1995
Federal Certificate of Capacity in business
1989
Degree in Economics – Università Cattolica, Milan
2003
ISMA Operations Certificate
1993
Financial Analyst Degree – Centre de Formation à
l’AnalyseFinancière – SFAF, Paris
2007-2008 Institut Supérieur de Formation Bancaire, Diploma in Banking
operations
Career summary
1995-1997 Société de Banque Suisse, Operations Division, Account
Manager
1997-1999 UBS SA Zurich, Operations Division
1999-2004 Six Group Zurich, Customer Relation Manager and Sales
Manager
Career summary
1990-1995 Groupe BNP, Paris – BNP Gestions
Sell Side Financial Analyst
1995-1998 Groupe BNP, Paris – BNP Gestions
Manager of institutional and mutual funds
1998-2001 Crédit Agricole Management, Paris
Senior Fund Manager, European Equities
Present duties
2001-2003 Crédit Agricole Asset Management, Milan
Since 2004
Head of Global Equities
Vice-President, head of the Risks and Control Department
2003-2006 Crédit Agricole Asset Management, Milan, CIO
Vice-Chairman of the Operational Management Committee
2006-2007 NEXTRA (Merger of Banca Intesa and Crédit Agricole Asset
Management), Milan
Head of European Equities
2007-2013 Indosuez Gestion, Groupe Crédit Agricole, Paris
CEO – CIO
Member of the Executive Committee of
Indosuez Private Banking
Member of the Managing Committee of CA Private Banking
5)
= Member from 1 May 2014 to 1 October 2014
31
4.2. Other activities and vested interests
4.4. Management contracts
The members of the Executive Committee have no other
activities or vested interests within the meaning of art. 4.2. of
the SIX Guidelines on Corporate Governance except those
described in section 4.1.
No such contracts exist at Edmond de Rothschild (Suisse) SA
4.3. Provisions relating to the number of
positions that may be held
(art. 12 para. 1 subpara. 1 of OER)
As required in art. 12 para. 1 subpara. 1 of OER, the Articles
of Association of Edmond de Rothschild (Suisse) SA contain a
provision (art. 23bis) on the maximum number of offices that
members of the Executive Committee may hold in other
companies and organisations.
Thus, within the limits permitted by Swiss banking regulations
and with the consent of the Board of Directors, members of
the Executive Committee may hold up to three offices in the
senior management and supervisory bodies of other legal
entities. Offices held in legal entities under joint control are
deemed to constitute a single office for the purposes of this
provision.
A company is not deemed another legal entity, within the
meaning of the above provision of the Articles of Association,
if:
1. it controls the Bank or is controlled by the Bank; or
2. it is under no obligation to register with the Registrar of
Companies or with a similar authority abroad; or
3. the office is held at the request of the Bank.
The Board of Directors of Edmond de Rothschild (Suisse) SA
will propose an amendment to this provision at the 2015
General Meeting, with a view to harmonising it with the
wording of the new article (19quater) of the Articles of
Association, to be introduced in 2015 (see section 3.3),
concerning the maximum number of offices that may be held
by the Directors
The amended wording of art. 23bis above will appear on the
agenda of the General Meeting of Edmond de Rothschild
(Suisse) SA to be published in the FOSC on 1 April 2015.
32
5. Remunerations,
profit-sharing and loans
Under OER, this year for the first time Edmond de Rothschild
(Suisse) SA is publishing details of the remuneration of its
Board of Directors and Executive Committee in a Pay Report
(p.107). The Pay Report also contains information that up to
now has appeared in section 5.
33
6. Shareholders’ rights
6.1. Limitation and representation
of voting rights
6.1.1 Provisions of the Articles of Association limiting
voting rights
Owners of registered shares may exercise their voting rights if
their names have been entered in the share register (art. 6,
para. 4 and art. 14, para. 1 of the Articles of Association).
Para. 5 et seq of art. 6 of the Articles of Association indicate
the grounds on which the Board of Directors may refuse to
enter the name of a shareholder in the share register (see also
section 2.6). Unless the approval needed to transfer
registered shares has been given by the Board of Directors,
the membership rights attaching to such shares shall remain
vested in the shareholder whose name appears in the share
register (art. 6, para. 9 of the Articles of Association and art.
685c, para. 2 of the CO).
The Articles of Association do not contain any restrictions on
the voting rights attaching to bearer shares. Holders of bearer
shares may exercise their voting rights at the General Meeting
simply by producing such shares or in any other manner
prescribed by the Board of Directors (art. 14, para. 3 of the
Articles of Association).
6.1.2 Provisions of the Articles of Association limiting
the voting rights of institutional representatives
The Articles of Association do not contain any restrictions on
the voting rights of institutional representatives.
6.1.3 Grounds for allowing exceptions during the
reporting year
As mentioned in section 2.6.2, no exceptions to the
restrictions on transferring registered shares were granted in
2014.
6.1.4 Procedure and conditions for abolishing
restrictions on voting rights
The procedure and conditions for abolishing restrictions on
transferring registered shares are indicated in section 2.6.4.
34
6.1.5 Provisions of the Articles of Association on
participating in General Meetings
Shareholders who own registered shares may only be
represented at General Meetings by another owner of
registered shares who has received a written proxy card or by
the Independent Proxy (art. 14, para. 2 of the Articles of
Association).
6.1.6 Instructions to the Independent Proxy and online
voting
The Articles of Association contain no rules on giving
instructions to the Independent Proxy and no provisions on
online voting for General Meetings.
6.2. Quorums
Annual General Meetings are deemed validly held when over
half the shares are represented (under art. 15 para. 1 of the
Articles of Association). In cases where this quorum is not
achieved, a second meeting may be convened with the same
agenda (cf. art. 15, para. 2 of the Articles of Association). The
second meeting may not take place until at least 30 days
have elapsed and it will be deemed validly held regardless of
the number of shares represented. This must be mentioned in
the notice (art. 15, para. 3 of the Articles of Association).
6.3. Notice of Annual General Meetings
The rules pertaining to notices of AGMs are set forth in articles
11, 12 and 31 of the Articles of Association, which draw on
the provisions of the Swiss Code of Obligations.
6.4. Items on the agenda
The rules pertaining to agendas and deadlines are set forth in
articles 11 and 12 of the Articles of Association, which draw
on articles 699 et seq of the Swiss Code of Obligations.
Article 11 of the Articles of Association
General Meetings shall be convened by the Board of Directors and, if
necessary, by the Auditors, the liquidators or the representatives of
bondholders.
One or more shareholders together representing at least 10 per cent
of the capital stock may also request that a General Meeting be
convened.
Shareholders representing shares with a total par value of CHF
1 million may request that an item be included in the agenda.
Convocations and inclusion of items in the agenda must be
requested in writing, mentioning the topics of discussion and
proposals.
Article 12 para. 1 and 2 of the Articles of Association
General Meetings shall be convened at least 20 days prior to the
date on which they are to be held, in accordance with the
procedures provided in article 31 on the Company’s notices.
Items included in the agenda must be referred to in the notice of the
General Meeting, together with the proposals of the Board of
Directors and the shareholders who requested the convocation of the
meeting or the item’s inclusion.
6.5. Entries in the share register
In accordance with Company practice, the deadline for
entering unlisted registered shares falls on the day the AGM
agenda is notified.
35
7. Take-over
and defensive measures
7.1. Obligation to tender an offer
The Bank has included in art. 6 para. 3 of its Articles of
Association a clause providing that bidders are not required to
make a formal take-over bid pursuant to articles 32, 52 and
53 of the Swiss Stock Exchanges and Securities Trading Act
(SESTA).
7.2. Clauses relating to take-overs
No member of the Bank’s senior management (Board of
Directors, Executive Committee and other senior officers) has
signed a contract protecting him/her from a transfer of control
by the Bank.
36
8. Independent Auditors
8.1. Duration of the Auditors’ mandate and
of the Chief Auditor’s term of service
8.4.
Since 1982 PricewaterhouseCoopers SA, Geneva, has
audited the parent company financial statements of Edmond
de Rothschild (Suisse) SA, Geneva. The financial statements
of the Edmond de Rothschild (Switzerland) Group are also
audited by PricewaterhouseCoopers SA Beresford Caloia has
served as Chief Auditor for our account since 2012.
PricewaterhouseCoopers SA draws up an auditing plan each
year. It drafts one report on its review of the annual financial
statements and another on its prudential audit. The auditor in
charge of our account discusses these reports with the Audit
Committee. The auditing plan was presented to the Board
Committee at its meeting on 27 August 2014. The
Independent Auditors’ findings in respect of the annual
financial statements were presented and discussed with the
Audit Committee and the Board of Directors at their respective
meetings in March.
8.2. Auditing fees
Edmond de Rothschild (Suisse) SA paid a total of CHF
2,924,000
in
auditing
fees,
VAT
included,
to
PricewaterhouseCoopers SA Geneva, within the meaning of
provision 8.2 of the Guidelines on Corporate Governance.
8.3. Additional fees
The Edmond de Rothschild (Switzerland) Group paid
additional
fees
totalling
CHF
2,198,000
to
PricewaterhouseCoopers SA Geneva and Hong Kong for tax
consulting services, VAT included, within the meaning of
provision 8.3 of the Guidelines on Corporate Governance.
Consultation with the Independent
Auditors
The Independent Auditors have access to the Audit
Committee at all times, as well as to the Executive Committee
and to the Internal Auditing Department, all of whom they meet
with regularly.
PricewaterhouseCoopers SA is hired on an annual basis. The
company’s qualifications, performance and fees are assessed
each year by the Audit Committee or the Board of Directors.
As required by FINMA, the auditor in charge of our account is
replaced every seven years.
37
9. Information policy
Edmond de Rothschild (Suisse) SA provides the fullest
disclosure possible to its existing and potential shareholders,
as well as to its employees and the general public. This
information is mainly conveyed in our annual reports, in press
releases, at press conferences on our annual results, through
interviews given to the financial media and securities analysts,
at the General Meeting of Shareholders and on the Bank’s
website at www.edmond-de-rothschild.ch, About Us/Investor
Relations.
Details on risk management and on the calculation of
consolidated shareholders’ equity are also available on the
Bank’s website, at www.edmond-de-rothschild.ch, About
Us/Investor Relations.
Events and calendar
10 March 2015
- Publication of the Bank’s 2014 results
31 March 2015
- Publication of our 2014 Annual Report
1 April 2015
- Publication of the notice of the Annual General Meeting of
shareholders and agenda in the FOSC (full text), le Temps,
L’Agefi, the Neue Zürcher Zeitung and Finanz und
Wirtschaft (summarised editions)
29 April 2015
- Annual General Meeting of shareholders in Geneva, at the
Château de Pregny.
28 August 2015
- Publication of our semi-annual 2015 results in the FOSC and
related press release.
Contacts
Investor relations:
Cynthia Tobiano
Chief Financial Officer
18, rue de Hesse, 1204 Geneva
Phone: +41 58 818 91 11
Fax :
+41 58 818 91 91
E-mail : [email protected]
Medias relations:
Sarah Arnett
Head of Communications-Marketing
Phone : +41 58 818 83 56
Fax :
+41 58 818 91 91
Stockmarket relations:
Yves Aeschlimann
Head of Legal and Compliance
Phone : +41 58 818 82 23
Fax :
+41 58 818 91 91
Fabienne Thionnet-Chevrier
Corporate Affairs Attorney
Phone : +41 58 818 90 74
Fax :
+41 58 818 91 91
Internet
www.edmond-de-rothschild.ch
in “About us/Investor Relations/Financial Informations”.
38
Edmond de Rothschild (Suisse) SA Group
Financial Report
40
41
45
47
51
Key Figures
53
54
56
57
58
Valuation policies
39
Key figures
Edmond de Rothschild (Suisse) SA Group
2014
Consolidated profit and loss account (in thousands of CHF)
Net interest income
2013
Change
(in CHF)
(in %)
40,824
37,040
3,784
10.2
Fee and commission income
496,072
507,278
(11,206)
(2.2)
Results of trading operations
79,210
83,548
(4,338)
(5.2)
Operating expenses (personnel costs and other overheads)
523,220
546,661
(23,441)
(4.3)
Gross profit
134,528
126,280
8,248
6.5
63,182
75,423
(12,241)
(16.2)
Profitability
% return on equity (net income/average shareholders’ equity) 1)
5.0
5.9
-
-
% return on assets (net income/average assets)
0.5
0.5
-
-
Earnings per bearer share after deducting portion due to minority interests
617
730
(112)
(15.4)
Earnings per registered share after deducting portion due to minority interests
123
146
(22)
(15.4)
Due from banks
8,519,793
9,905,850
(1,386,057)
(14.0)
Advances to customers
2,493,028
1,733,963
759,065
43.8
257,987
316,812
(58,825)
(18.6)
14,771,895
14,431,740
340,155
2.4
1,294,337
1,328,790
(34,453)
(2.6)
16,983,080
16,586,998
396,082
2.4
109,462
108,611
851
0.8
8,698
10,213
(1,515)
(14.8)
- net inflow of fresh funds
(2,905)
1,585
(4,490)
-
Group personnel (number of employees)
Average number of employees
1,737
1,805
(68)
(3.8)
718
732
(14)
(1.9)
1,019
1,073
(54)
(5.0)
Total number of employees at year-end
1,681
1,777
(96)
(5.4)
Number of employees at year-end, converted into full-time jobs
1,635
1,716
(81)
(4.7)
Group net Income
Shares (in CHF)
Consolidated balance sheet (in thousands of CHF)
Due to banks
Customer deposits
Shareholders’ equity 2)
Balance sheet total
Assets under management (in millions of CHF)
Total assets under management (includes double reporting)
of which: - double reporting
- in Switzerland
- abroad
1)
After appropriation of the parent company’s earnings
2)
Including Group net income before payment of dividend by parent company and minority interests
40
to the shareholders on the consolidated accounts
of Edmond de Rothschild (Suisse) SA at the general meeting on 29 April 2015
Dear Shareholders,
In these relatively difficult circumstances, assets under
management of Edmond de Rothschild (Switzerland) came to
CHF 109.5 billion at 31 December 2014, up CHF 4.5 billion
(+4.3%) compared with the end-2013 level, based on an
unchanged scope of consolidation. Allowing for the sale of the
Group’s asset servicing business in Italy (removing CHF 3.6
billion, or -3.3%, of assets), the net change in assets under
management was negative, down 2.9 billion, despite positive
market and currency effects amounting to CHF 7.4 billion.
Thanks to our position as a wealth management company under
stable family control, we have the strength needed to meet the
challenges ahead and to continue striving for excellence while
constantly adapting our organisational structure to the changes
that are reshaping our industry. Today we must know not only
how to keep our business model in line with new regulatory
developments but also how to go on expanding both our
domestic and international operations.
Edmond de Rothschild (Suisse) SA introduced changes to its
governance in 2014, with the formation of a new Executive
Committee.
It now has five members:
− Emmanuel Fievet, CEO and Chair of the Executive
Committee
− Luca Venturini, Deputy CEO and Vice-Chair of the
Executive Committee
− Sabine Rabald, Deputy CEO
− Yves Aeschlimann, Head of Legal and Compliance
− Cynthia Tobiano, CFO
The role of this new Executive Committee is to steer the
operations of Edmond de Rothschild (Suisse) SA.
In Switzerland we pursued our tilt towards onshore clients
last year. Edmond de Rothschild (Suisse) SA, Geneva is the
flagship of the International Private Banking division. New
teams recruited in 2014 will soon join the Bank to spur its
growth.
2014 was a satisfactory year for our Asset Management
division and in particular for our funds of funds business (both
traditional and alternative), mainly thanks to friendly market
conditions.
The Edmond de Rothschild (Suisse) SA Group continued to
grow its Private Banking business in Switzerland and abroad.
Swiss network
Geneva, Fribourg, Lausanne and Lugano
Edmond de Rothschild (Suisse) SA has a strong presence in
Geneva and also operates through its branches in Fribourg and
Lausanne.
Our subsidiary Edmond de Rothschild (Lugano) SA continued
to grow. It had CHF 5.3 billion of assets under management
at end-2014, up 5.3% on the year-earlier level. Net profit was
up.
International network
Branch and representation office
Hong Kong
The sales force of our Hong Kong branch was strengthened
in 2013 with the recruitment of Monique Chan, who is now in
charge of Edmond de Rothschild (Suisse) SA Hong Kong
Branch.
2014 also saw continuous investment in human and
operational resources that led to an inflow of fresh money
totalling more than CHF 400 million.
41
Subsidiaries
Luxembourg
Edmond de Rothschild (Europe), our Luxembourg subsidiary,
last year pursued its strategy of long-term growth in its
businesses of private banking, asset management and
investment funds administration.
2014 was highlighted by the sale of the Group’s International
Fund Services unit in Italy and the outsourcing of part of
Luxembourg’s asset servicing, record-keeping, custody,
transfer agent and accounting segments. However, the
subsidiary maintained its role as depositary and central fund
administrator.
United Kingdom
The operation of Edmond de Rothschild (UK) Limited, form
into the following main lines of business:
-
Private Merchant Banking
Asset
Management,
including
bond
and
infrastructure funds
Main service provider for the Capital Holdings line of
investment funds
Bond dealing
Trading in emerging market funds
Corporate finance, M&A activity and financing.
The London cluster represents a strategic axis of growth for
the Edmond de Rothschild (Suisse) SA hub, as reflected by its
large-scale recruiting last year both in private banking and
asset management.
London’s asset management arm was strengthened by
setting up a team specialising in infrastructure debt, which
launched the BRIDGE programme, and by beefing up the
sales force.
42
Guernsey
In Guernsey, Edmond de Rothschild Securities (CI) Limited
offers structured products and brokerage services and acts
as intermediary for securities listed on the Guernsey Stock
Exchange. Edmond de Rothschild Securities (CI) Limited also
provides asset management services to investment funds as
well as discretionary portfolio management services to private
and institutional clients.
Monaco
Our Monaco subsidiary, Edmond de Rothschild (Monaco), is
54.85% owned by the Edmond de Rothschild (Switzerland)
Group.
Thanks to a dynamic sales effort, subsidiary’s assets under
management rose 7.7% in 2014 to EUR 5.9 billion. The net
inflow of fresh money totalled EUR 111 million. Consolidated
net profit came to EUR 12.1 million in 2014, marking a jump
of 29% on the previous year’s level.
Bahamas
2014 was marked by new legislation that increased pressure
on profit margins. Our Nassau subsidiary generated a net
profit of CHF 10.7 million, stable compared with 2013.
Roundup of 2014 results
Despite a 6.5% increase in gross profit, the net earnings of
the Edmond de Rothschild (Suisse) SA hub were down
16.2% compared with the previous year. This was mainly due
to the non-recurrence of extraordinary income registered in
2013.
Revenue
Interest income totalled CHF 40.8 million, up 10.2%
compared with the 2013 figure (CHF 37 million). This drop
reflects historically low interest rates.
Income from fees and commissions fell 2.2% to CHF 496.1
million from CHF 507.3 million the previous year.
Results of trading operations amounted to CHF 79.2 million,
down 5.2% on their 2013 level of CHF 83.5 million. The rise
was largely due to a higher profit on forex dealing.
Other ordinary results totalled CHF 41.6 million, marking a
7.6% drop on the year-earlier figure.
Expenses
The average number of staff employed by our Group last year
was 1,737, down from 1,805 in 2013. Personnel expenses
amounted to CHF 371.9 million, compared with CHF 393.1
million the previous year, marking a decrease of 5.4%.
Other operating expenses were down 1.4% to CHF 151.3
million from CHF 153.5 million in 2013.
Total operating expenses came to CHF 523.2 million, 4.3%
lower than the year-earlier level.
Gross profit
Group gross profit was up 6.5% and totalled CHF 134.5
million, versus CHF 126.3 million in 2013 with a rise of nearly
two basis points in the operating ratio.
Depreciation of fixed assets worked out to CHF 37.3 million,
or 3.1% less than in the previous year.
Extraordinary income amounted to CHF 25.2 million, down
sharply on the 2013 figure (CHF 59.6 million). This item chiefly
includes the release of provisions no longer required for
operating purposes and a release from the reserve for general
banking risks.
Extraordinary expenses totalled CHF 1.4 million, or 78.6% less
than the CHF 6.6 million reported the previous year.
Taxes came to CHF 16 million, up 32.2% on the year-earlier
figure of CHF 12.1 million.
Balance sheet review
The consolidated balance sheet total stood at CHF 17 billion
at end-2013, up 2.4% on the year-earlier level.
Current assets including cash, bank deposits, loans to
customers, mortgage bills, claims arising from money market
paper and securities and precious metals held for trading
purposes totalled CHF 16 billion, marking an increase of 1.9%
versus the previous year’s figure.
Financial investments amounted to CHF 721 million, or a 4.5%
drop compared with CHF 754.8 million in 2013.
Fixed assets stood at CHF 235.9 million, up from CHF 232.7
million at end-2013.
Adjustment accounts totalled CHF 102.7 million, compared
with CHF 106.8 million the previous year.
“Other assets” came to CHF 297 million, compared with CHF
170.1 million at end-2013. The increase was due to the
higher replacement value of open currency positions at the
end of the reporting year.
On the liabilities side, borrowed funds comprised of debits on
money-market paper and sums due to banks and customers
amounted to CHF 15 billion, compared with CHF 14.8 billion
in 2013, and represent 88.5% of the balance-sheet total. The
1.9% increase was chiefly attributable to the higher level of
clients’ deposits.
43
“Other liabilities” totalled CHF 320.5 million, compared with
CHF 200.4 million at end-2013. The 59.9% increase was
partly due to the rise in the negative replacement values of
open derivative instruments.
Valuation adjustments and provisions totalled CHF 115.1
million, up by CHF 9 million on the previous year.
The reserve for general banking risks fell 7.6% to CHF 242.1
million from its year-earlier level of CHF 262.2 million.
Prior to the dividend payout, Group capital and reserves stood
at CHF 1.3 billion, representing 7.6% of the balance sheet
total.
Capital ratio
Return on equity worked out to 5%. Shareholders’ equity as
required by the BIS (under the Basel III rules) came to CHF
279.9 million. Eligible capital totalled CHF 1.1 billion. The
capital adequacy ratio (BIS ratio) was 32.2%, well above the
12% legal minimum, reflecting surplus shareholders’ equity of
more than CHF 700 million.
Outlook for 2015
In 2015, our attitude will remain guarded, however. The recent
decision by the Swiss National Bank to abandon its euro/franc
floor rate and charge negative interest on deposits will have an
adverse impact on our revenues. We will have to remain
watchful and continue adapting to a fast-changing
environment.
Bolstered by our family ownership, long-term vision and
healthy, rock-solid balance sheet, the Edmond de Rothschild
(Suisse) SA hub will be focused in the coming year on
satisfying the clients of both our private banking and asset
management divisions and on continuing to transform our
business model.
We cannot conclude this report without expressing our
gratitude to you, our shareholders, and to our clients for their
abiding trust.
The Board of Directors
44
to the general meeting of Edmond de Rothschild (Suisse) SA, Geneva
(previously Banque Privée Edmond de Rothschild SA, Geneva)
Report of the statutory auditor on the
consolidated financial statements
As statutory auditor, we have audited the consolidated
financial statements of Edmond de Rothschild (Suisse) SA
(previously Banque Privée Edmond de Rothschild SA,
Geneva), which comprise the balance sheet, income
statement, statement of cash flows and notes (pp. 47-84), for
the year ended 31 December 2014.
Board of Directors’ Responsibility
The Board of Directors is responsible for the preparation and
fair presentation of the consolidated financial statements in
accordance with the requirements of Swiss law and the
Articles of Association. This responsibility includes designing,
implementing and maintaining an internal control system
relevant to the preparation of consolidated financial
statements that are free from material misstatement, whether
due to fraud or error. The Board of Directors is further
responsible for selecting and applying appropriate accounting
policies and making accounting estimates that are reasonable
in the circumstances.
Auditor’s Responsibility
Our responsibility is to express an opinion on these
consolidated financial statements based on our audit. We
conducted our audit in accordance with Swiss law and Swiss
Auditing Standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance whether the
consolidated financial statements are free from material
misstatement.
An audit involves performing procedures to obtain audit
evidence about the amounts and disclosures in the
consolidated financial statements. The procedures selected
depend on the auditor’s judgment, including the assessment
of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers the internal control
system relevant to the entity’s preparation and fair
presentation of the consolidated financial statements in order
to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the entity’s internal control
system. An audit also includes evaluating the appropriateness
of the accounting policies used and the reasonableness of
accounting estimates made, as well as evaluating the overall
presentation of the consolidated financial statements. We
believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements for the
year ended 31 December 2014 give a true and fair view of the
financial position, the results of operations and the cash flows
in accordance with accounting rules for banks and comply
with Swiss law.
45
Report on other legal requirements
We confirm that we meet the legal requirements on licensing
according to the Auditor Oversight Act (AOA) and
independence (article 728 CO and article 11 AOA) and that
there are no circumstances incompatible with our
independence.
In accordance with article 728a paragraph 1 item 3 CO and
Swiss Auditing Standard 890, we confirm that an internal
control system exists which has been designed for the
preparation of consolidated financial statements according to
the instructions of the Board of Directors.
We recommend that the consolidated financial statements
submitted to you be approved.
Beresford Caloia
Audit Expert
Auditor in charge
Geneva, 23 March 2015
46
Alain Lattafi
Audit Expert
at 31 December 2014
Fully consolidated entities of the Edmond de Rothschild (Switzerland) Group
In Switzerland
Parent company
Geneva
CHF
Financial and asset management companies
Orex Asset Management
Fribourg
45.000m
2)
Bank
Edmond de Rothschild (Lugano) SA
Lugano
100%
1)
CHF
1)
82%
Priadvisory Holding SA
Geneva 3)
100%
5.000m
2)
2.100m
2)
0.100m
2)
1)
CHF 2.000m
2)
CHF 3.120m
2)
Services
Privaco Family Office SA
Geneva
1)
100%
CHF
Les Conseillers du Léman Associés SA
4)
Geneva
100%
1)
CHF
1) Direct and/or indirect holding by parent company
2) Share capital
3) Wholly owned by Edmond de Rothschild (Switzerland) Europe, Luxembourg
4) Wholly owned by Privaco Family Office SA, Geneva
47
Abroad
Banks
Asset management companies
Luxembourg
Edmond de Rothschild Asset Management (Luxembourg)
Luxembourg 6)
1)
100%
EUR 31.500m
Edmond de Rothschild (Bahamas) Ltd
Nassau
2)
1)
100%
EUR 18.125m
Edmond de Rothschild Asset Management (UK) Limited
7)
London
2)
1)
100%
CHF 15.000m
Edmond de Rothschild (Monaco) Monaco
3)
Monaco
2)
1)
80%
GBP 1.800m
Edmond de Rothschild Asset Management (C.I.) Limited
8)
Guernsey
2)
2)
1)
100%
Edmond de Rothschild Conseil SA
9)
Luxembourg
0.005m
2)
1)
100%
EUR 0.050m
Edmond de Rothschild Client Nominees (UK) Limited
10)
London
2)
54,85%
1)
EUR 12.000m
Service and real estate companies
COPRI III SA
Luxembourg
1)
2)
100%
EUR 0.747m
Edmond de Rothschild Family Advisory, (Hong Kong) Limited
7)
Hon
HongKong
Kong
1)
100%
L’immobilière Baldauff
Hon
Kong 7) 5)
Luxembourg
100%
1)
HKD 12.675m
2)
EUR 9.821m
2)
80%
1)
EUR
GBP
0.001m
2) Share capital
3) Owned 34% by Edmond de Rothschild (Suisse) SA, Geneva, 18% by Edmond de Rothschild (Lugano) SA, Lugano and 5.21% by Incentive
Management SAM, Monaco
4) Wholly owned by Privaco Family Office SA, Geneva
5) Wholly owned by Edmond de Rothschild (Europe), Luxembourg
6) Owned 99.92% by Edmond de Rothschild (Europe), Luxembourg and 0.08% by LCF Rothschild Conseil SA, Luxembourg
7) Wholly owned by Edmond de Rothschild (UK) Limited, London
8) Wholly owned by Edmond de Rothschild (C.I.) Limited, Guernsey
9) Owned 99.99 by Edmond de Rothschild (Europe), Luxembourg and 0.01 by Edmond de Rothschild Asset Management (Luxembourg), Luxembourg
10) Wholly owned by LCF Edmond de Rothschild Securities (UK) Limited, London
48
2)
Abroad
Financial and brokerage firms
Edmond de Rothschild (UK) Limited
London
Edmond de Rothschild Securities (C.I.) Limited
Guernsey
1)
80 %
GBP 1.000 m
Edmond de Rothschild Securities (UK) Limited
3)
London
2)
1)
80 %
GBP 1.000 m
Edmond de Rothschild Holdings (C.I.) Limited
Guernsey
2)
100%
1)
GBP
0.040 m
1)
100%
Incentive Management SAM
Monaco
2)
4)
GBP
0.000002 m
2)
EUR
0.150 m
2)
EUR
0.000001 m
2)
49
5)
1)
54.74%
Priglobal Advisory Limited
Cayman Islands
6)
100%
1)
2) Share capital
3) Wholly owned by Edmond de Rothschild (UK) Limited, London
4) Wholly owned by Edmond de Rothschild (C.I.) Limited, London
5) Owned 99.80% by Edmond de Rothschild (Monaco), Monaco
6) Wholly owned by Priadvisory Holding SA, Geneva
Prifund Conseil SA
Luxembourg
Edmond de Rothschild Assurances et Conseils (Europe)
3)
Luxembourg
7)
1)
2)
100%
EUR
0,078 m
Edmond de Rothschild (Suisse) SA, Representcion Uruguay
Montevideo
1)
100%
EUR
Edmond de Rothschild Gestion (Monaco)
Monaco
8)
1)
100%
USD
0.014 m
Edmond de Rothschild Assurances et Conseils (Monaco)
4)
Monaco
2)
54,41%
EDRRIT Ltd
1)
Londres
9)
1)
54,58%
EUR
Iberian Renewable Energies GP, S.à r.l.
5)
Luxembourg
0.150 m
2)
1)
100%
Prifund Conseil (Bahamas) SA
3)
Nassau
EUR
0.013 m
1)
100%
E.C.H. Investments Ltd
6)
Cayman Islands
EUR
0.070 m
2)
1)
EUR
0.251 m
2)
53,65%
2)
0.150 m
2)
1)
72%
GBP
0.278 m
Edmond de Rothschild Capital Holdings Limited
2)
London
10)
72%
1)
EUR
GBP
0.250 m
Direct and/or indirect holding by parent company
2)
Share capital
3)
Wholly owned by Edmond de Rothschild (Europe), Luxembourg
4)
Owned 99.30% by Edmond de Rothschild (Monaco), Monaco
5)
Wholly owned by Edmond de Rothschild (Europe), Luxembourg
London
11)
79,80%
1)
GBP
14.136 m
Owned 42.60% by Edmond de Rothschild (Suisse) SA, Genève, 4.98% by Edmond de Rothschild Capital Holdings Limited, London
and 7.47% by Edmond de Rothschild (Europe), Luxembourg
7)
Owned 99.68% by Edmond de Rothschild (Europe), Luxembourg and 0.32% by Edmond de Rothschild Asset Management, Luxembourg
8)
Owned 99.30% by Banque Edmond de Rothschild (Monaco), Monaco
9)
Owned 41% by Edmond de Rothschild (UK) Limited, London
10) Wholly owned by EDRRIT Limited, London
11) Owned 99.75% by Edmond de Rothschild (UK) Limited, London
50
2)
Edmond de Rothschild Private Merchant Banking LLP
1)
6)
2)
0.050 m
2)
The consolidated financial statements of the Edmond de
Rothschild (Switzerland) Group have been prepared in
accordance with the provisions of the Federal Law on Banks
and Savings Banks, its implementing ordinance (OB), the
guidelines issued by FINMA (the Swiss Financial Market
Supervisory Authority) and the provisions on the drawing up of
financial statements in the Listing Rules of the Swiss
Exchange. The financial statements provide a true picture of
the Group’s assets, financial situation and earnings.
Scope of consolidation
Group companies
The consolidated financial statements of the Edmond de
Rothschild (Switzerland) Group include the financial
statements of the major companies operating in the banking
and financial sector, as well as the real estate companies in
which the parent company holds, directly or indirectly, a
majority interest (for details of the companies concerned, refer
to pp. 47-50).
Changes to the scope of consolidation
The following company was consolidated during the reporting
period:
- Orox Asset Management SA, Geneva (formerly accounted
for using the equity method)
- L’immobilière Baldauff SA, Luxembourg
Holdings accounted for using the equity method
Associated companies in which the Group owns a 20% to
50% interest are consolidated using the equity method; the
value shown under “Holdings” represents the Group’s share in
the equity and net income of these entities, rather than the
value of the shares under our control.
The companies concerned are Edmond de Rothschild Asset
Management (Switzerland)SA (34.68%), ACH Management
SA (38%), LCF EdR Nikko Cordial Japon (50%) and LCH
Investment NV (44%).
The difference resulting from the first consolidation is
disclosed in “Retained earnings”. The impact of applying the
Group’s accounting principles to these affiliated companies
has been considered as minor on the consolidated financial
statements. As a consequence, the equity application is
based on the unadjusted accounts of the companies held.
Equity stakes accounted for under the equity method are
shown under “Non-consolidated holdings”.
The Group’s share in the profits of companies consolidated
using the equity method is presented as a separate item in
the consolidated profit and loss account.
Other holdings
Majority interests of lesser impact or whose sale is envisaged,
as well as other stakes of less than 50%, are disclosed under
“Non-consolidated holdings”.
The following companies were deconsolidated during the
reporting period:
- Priasia Ltd, BVI
- Rouiller, Zurkinden & Cie Finance SA, Fribourg (merger by
absorption by Edmond de Rothschild (Switzerland) SA
on 01.01.2014)
- La Companie Privée de Finance, Jersey
- Edmond de Rothschild International Funds Ltd, Bermuda
51
Consolidation methods
Newly acquired companies
Full consolidation method
The financial statements of all companies within the Group are
fully consolidated.
As a rule, newly acquired companies are included in the
consolidated financial statements in the year of their
acquisition.
All assets and liabilities, as well as expenses and income of
Group companies, are fully integrated (line-by-line).
Closing date for consolidated accounts
Intercompany balance sheet items and profit and loss
transactions between consolidated Group companies are set
off against each other.
Off-balance sheet items are also fully consolidated and set off
when they relate to intercompany transactions within the
Group.
Dividends are eliminated through reserves. The entitlement of
third-party shareholders (minority interests) to equity and net
income is disclosed separately.
Capital consolidation
The capital invested in the Group’s banks and investment,
asset management and real estate companies is consolidated
in accordance with the purchase method.
The positive or negative differences arising from the first
consolidation are disclosed under “Intangible assets” and
“Retained earnings” respectively.
The value of the Bank’s treasury stock, or own shares, is
deducted from capital and reserves and reported under
“Additional paid-in capital and other reserves” at the shares’
cost price. Dividends and the proceeds of subsequent sales
are directly allocated to “Additional paid- in capital and other
reserves”.
52
The consolidated companies all end their financial year on 31
December except for Priadvisory Holding SA, Prifund Conseil
SA and Prifund Conseil (Bahamas) SA whose financial years
conclude on 30 November.
Valuation policies
Translation of financial statements
in foreign currency
Results of forex and precious metals
transactions
Transactions in foreign currency are reported at the exchange
rate applicable on the date of the relevant transaction. Profits
and losses arising from the settlement of these transactions
are reported in the profit and loss account. along with profits
and losses arising from the conversion at the exchange rate
on the balance sheet date of claims and liabilities on money
market placements denominated in foreign currency.
Trading positions in forex and precious metals are evaluated
at year-end rates and prices.
The balance sheets of fully consolidated companies
expressed in foreign currency are translated into Swiss francs
at the year-end exchange rate. except for shareholders’ equity
which is translated at historical rates.
The profit and loss accounts of Group companies are
translated at yearly average exchange rates.
In the case of foreign companies consolidated using the
equity method. the year-end market rate is applied to the
Group’s share of equity expressed in foreign currency. The
Group’s share of the net income of these affiliated companies
is translated at the annual average exchange rate.
Translation differences resulting from full consolidation and
from the equity method are reported as shareholders’ equity in
“Retained earnings”.
The exchange rates used to convert sums in foreign currency
are as follows:
2014
2013
Closing
Average
Closing
Average
rate
2014 rate
rate
2013 rate
EUR
1.20
1.21
1.23
1.23
USD
0.99
0.92
0.89
0.92
GPB
1.54
1.51
1.47
1.45
Major currencies
Forward positions are estimated at year-end at the forward
rate for the remainder of the period. Forex differences are
recorded in the profit and loss account.
Income and expenses expressed in foreign currency are
translated at the market rate prevailing on the transaction date.
Fixed assets and financial investments
Fixed assets are stated at cost less depreciation (see Note 8
in the Notes to the Consolidated Financial Statements),
except for the equity stakes in associated companies
consolidated as per the equity method. These are shown
under “Non-consolidated holdings”.
Income and expenses
The income and expenses generated by the Group companies
are accounted for in the period to which they relate.
Personnel welfare liabilities
Contributions are reported as personnel expenses in the profit
and loss account for the year to which they relate.
Each year the Group determines whether it has derived any
economic benefits or commitments from personnel welfare
plans for Group staff. If any are found, they are stated in the
balance sheet pursuant to rule 16 of the Swiss accounting
principles (GAAP RPC 16). The difference in relation to he
corresponding amount reported the previous year is included
in “Personnel expenses” in the profit and loss account.
Transaction bookings
and balance sheet reporting
This annual study is based on contracts, on financial
statements bearing a closing date no older than 12 months
and drawn up in accordance with GAAP RPC 16 (in the case
of Swiss pension funds) and on any other relevant
calculations.
Since 31 Dec. 2006 the balance sheet and profit and loss
statement have been drawn up on the basis of settlement
dates.
Other balance sheet
and profit and loss items
The accounting principles and valuation policies concerning
other items are set out in the Notes to the Consolidated
Financial Statements.
53
at 31 December 2014 (in thousands of CHF)
Notes
2014
2013
(in CHF ‘000)
(in CHF ‘000)
(in CHF ‘000)
Change
(in %)
Assets
Cash and other liquid assets
18
4,364,274
3,397,760
966,514
28.4
Claims arising from money market paper
1, 18
107,056
158,463
(51,407)
(32.4)
Due from banks
2, 18
8,519,793
9,905,850
(1,386,057)
(14.0)
Due from customers
3, 18
2,422,244
1,689,327
732,917
43.4
Mortgage loans
3, 18
70,784
44,636
26,148
58.6
Total advances to customers
4, 20
2,493,028
1,733,963
759,065
43.8
Securities and precious metals trading portfolios
5, 18
16,015
19,778
(3,763)
(19.0)
Financial investments
6, 18
721,026
754,820
(33,794)
(4.5)
7, 8
115,834
97,451
18,383
18.9
Fixed assets
8
235,868
232,684
3,184
1.4
Intangible assets
8
10,524
9,272
1,252
13.5
Accrued income and prepaid expenses
8
102,648
106,831
(4,183)
(3.9)
Other assets
9
297,014
170,126
126,888
74.6
8, 19, 21, 22, 23
16,983,080
16,586,998
396,082
2.4
2,957
2,563
394
15.4
81,109
42,211
38,898
92.2
Holdings
Total assets
Subordinated amounts receivable
Due from non-consolidated Group companies and qualifying
shareholders
54
7, 14
at 31 December 2014 (in thousands of CHF)
Notes
2014
2013
(in CHF ‘000)
(in CHF ‘000)
Change
(in CHF ‘000)
(in %)
Liabilities
Liabilities arising from money market paper
18
1,327
3,607
(2,280)
(63.2)
Due to banks
18
257,987
316,812
(58,825)
(18.6)
Due to customers on savings or deposit accounts
18
6,640
6,905
(265)
(3.8)
11, 18
14,765,255
14,424,835
340,420
2.4
14,771,895
14,431,740
340,155
2.4
221,954
199,557
22,397
11.2
120,084
59.9
Other amounts due to customers
Total due to customers
Accrued expenses and deferred income
Other liabilities
12
320,458
200,374
Valuation adjustments and provisions
13
115,122
106,118
9,004
8.5
Reserves for general banking risks
13
242,129
262,152
(20,023)
(7.6)
Share capital
14
45,000
45,000
-
-
91,597
91,455
142
0.2
885,259
889,421
(4,162)
(0.5)
(67,476)
(68,234)
758
(1.1)
34,646
33,573
1,073
3.2
63,182
75,423
(12,241)
(16.2)
Additional paid-in capital and other reserves
Retained earnings
15
Treasury stock
Minority interests in shareholders’ equity
16
Consolidated net income
9,404
11,899
(2,495)
(21.0)
17
1,294,337
1,328,790
(34,453)
(2.6)
19, 21, 23
16,983,080
16,586,998
396,082
2.4
-
-
-
-
7, 14
32,961
16,626
16,335
98.2
Contingent liabilities
4, 20, 24, 25
185,416
193,795
(8,379)
(4.3)
Irrevocable liabilities
4
131,707
66,337
65,370
98.5
4
-
1,958
(1,958)
(100.0)
263,504
139,048
124,456
89.5
233,725
136,557
97,168
71.2
20,515,941
22,137,362
(1,621,421)
(7.3)
3,154,570
3,190,274
(35,704)
(1.1)
of which: - minority interests
Total Group capital and reserves
Total liabilities
Subordinated liabilities
Due to non-consolidated holdings and qualifying shareholders
Off-balance sheet transactions
Liabilities for unpaid share capital and additional capital contributions
Derivative instruments
Positive
Negativereplacement
replacementvalues
values
26
Underlying values
Fiduciary transactions
27
55
for the year ended 31 December 2014 (in thousands of CHF)
Notes
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in CHF ‘000)
(in %)
6,538
(1)
17.5
(1.1)
Interest and discount income
Interest and dividend income on trading portfolios
29
29
43,871
94
37,333
95
Interest and dividend income on financial investments
29
4,530
5,003
(473)
(9.5)
Interest payable
30
7,671
5,391
2,280
42.3
40,824
37,040
3,784
10.2
2,004
1,444
560
38.8
Interest income, net
Commission income on lending activities
Commission income on securities and investment transactions
31
567,591
537,357
30,234
5.6
Commission income on other services
32
60,753
75,243
(14,490)
(19.3)
Commissions payable
134,276
106,766
27,510
25.8
Fee and commission income, net
496,072
507,278
(11,206)
(2.2)
79,210
83,548
(4,338)
(5.2)
694
2,343
(1,649)
(70.4)
21,433
22,662
(1,229)
(5.4)
17,098
14,995
2,103
14.0
4,335
7,667
(3,332)
(43.5)
1,040
1,292
(252)
(19.5)
26,032
20,922
5,110
24.4
7,557
2,144
5,413
252.5
33
Proceeds from the sale of financial investments
Income from holdings
of which: - holdings reported using the equity method
- other non-consolidated holdings
Real estate income
Other ordinary income
34
Other ordinary expenses
Other ordinary results
Total operating income
41,642
45,075
(3,433)
(7.6)
657,748
672,941
(15,193)
(2.3)
(5.4)
Personnel expenses
35
371,871
393,130
(21,259)
Other operating expenses
36
151,349
153,531
(2,182)
(1.4)
523,220
546,661
(23,441)
(4.3)
Total operating expenses
Gross profit
Depreciation of fixed assets
Valuation adjustments, provisions and losses
134,528
126,280
8,248
6.5
8,37
37,292
38,497
(1,205)
(3.1)
38
41,846
53,251
(11,405)
(21.4)
55,390
34,532
20,858
60.4
25,160
59,562
(34,402)
(57.8)
(78.6)
Result before extraordinary items and taxes
Extraordinary income
39
Extraordinary expenses
39
1,411
6,597
(5,186)
Taxes
40
15,957
12,074
3,883
32.2
41, 42, 43
63,182
75,423
(12,241)
(16.2)
9,404
11,899
(2,495)
(21.0)
of which: - minority interests’ share in consolidated net income
56
At 31 December 2014 (in thousands of CHF)
2014
2013
Source of
funds
Application of
funds
Group net income
63,182
37,292
Source of
funds
Application of
funds
-
75,423
-
-
38,497
-
4,183
-
-
14,020
22,397
-
17,760
-
9,004
-
36,503
-
-
20,023
-
25,271
Previous year’s dividend
Other changes in reserves and minority interests
Net cash used in/provided by operating activities (results of
operations)
Share capital
Balance
56,250
136,058
76,273
56,250
59,785
168,183
95,541
142
-
-
641
-
21,504
-
1,910
142
21,504
-
2,551
-
18,831
4,169
-
- land and buildings
-
331
16,618
-
Other fixed assets
-
38,170
-
26,768
11,463
Additional paid-in capital
Net cash used in/provided by transactions involving
shareholders’ equity
- other non-consolidated holdings
Other intangible assets
Exchange rate changes
Net cash used in/provided by transactions involving financial
investments and fixed assets
Money market transactions
Due from banks
Due to banks
Securities and precious metals portfolios held for trading
purposes
Banking and trading activities
-
3,335
-
556
-
-
992
556
60,667
20,787
39,223
51,407
-
101,080
-
-
2,280
51,407
2,280
1,386,057
(60,111)
2,642
-
103,722
-
-
-
2,111,721
49,127
-
58,825
10,238
-
3,763
-
-
1,562
33,794
-
370,968
-
1,423,614
58,825
381,206
2,113,283
Due from customers
-
732,917
-
49,651
Mortgage loans
-
26,148
-
21,256
Savings and deposit accounts
-
265
-
182
340,420
-
1,364,479
-
-
-
-
-
340,420
759,330
1,364,479
71,089
-
126,888
-
1,054
Medium-term bank bonds
Transactions with customers
Other assets
Other liabilities
120,084
-
Other balance sheet items
120,084
126,888
-
966,514
Balance
1,364,789
(418,910)
(6,804)
-
34,862
-
35,916
319,226
-
72,642
(18,436)
103,722
(1,732,077)
1,293,390
(35,916)
-
966,514
(966,514)
319,226
-
319,226
Net cash used in/provided by banking activities
1,935,525
1,913,837
21,688
2,168,633
2,220,288
(51,655)
Total cash flows
2,072,281
2,072,281
2,357,603
2,357,603
57
At 31 December 2014 (in thousands of CHF)
Description of operations
and disclosure of staff size
Description of our risk control
and management system
Edmond de Rothschild (Suisse) SA, the Edmond de
Rothschild Group’s flagship entity, is an all-service bank
specialising in wealth management for private and institutional
clients. It is a member of SIX Swiss Exchange.
Risk management
Converted to full-time jobs, the number of staff employed by
the Edmond de Rothschild (Suisse) Group stood at 1716 at
end-2013 versus 1755 a year earlier.
Through its network of branches and subsidiaries in
Switzerland and abroad, the Group conducts on its clients’
behalf all the operations customarily performed by private
banking institutions. Fee and commission business on behalf
of clients mainly includes portfolio management, fiduciary
deposits and payment transactions, along with trading in
securities, precious metals and derivative instruments. The
Group also manages and administers investment funds.
In addition, the Group actively deals in debt instruments,
equities, currencies, precious metals and derivatives on a
proprietary basis, but does not engage in commodity trading.
Disclosure of accounting principles
and valuation policies
Risk policy
Edmond de Rothschild (Suisse) SA (“the Bank”) and its
subsidiaries in Switzerland and abroad (“the Group”) are
mainly active in Private Banking and Asset Management. The
Group’s operations also include administering investment
funds and providing investment advisory services. As the
Group’s parent company, the Bank is responsible for supervising risk control and management throughout the Group.
A joint risk policy drawn up by the Bank and approved by the
Board of Directors sets the general guidelines that apply to all
the Group entities. Taking account of these guidelines and
local regulations, each affiliate sets up its own section in
charge of identifying, monitoring and mitigating the risks to
which it is exposed.
Large human and technical resources have been made
available for the supervision and organisational structure of the
Group’s risk control units. These resources are constantly
adapted to take account of regulatory changes and the
requirements of the Group’s business.
Risk management is set up as follows:
-
The Board of Directors determines the Group’s risk
appetite and the components of risk management, in
line with the recommendations made by Edmond de
Rothschild Holding SA for the Edmond de Rothschild
Group as a whole.
-
The Audit Committee supervises and assesses the
operational aspects of risk management. It monitors
risks periodically by examining reports compiled at
regular intervals or on request by the Risk Control
and Management Department.
-
The Executive Committee is responsible for
implementing procedures designed to identify,
analyse, evaluate and monitor all risks incurred by
the Bank and the Group. Together with the Risk
Committee it oversees implementation of the risk
policy laid down by the Board of Directors and
ensures that all important information on the status of
the aforementioned risks is collected, processed
and notified to the designated management and
supervisory bodies.
The general accounting and consolidation principles are set
out under a separate heading.
All assets, liabilities and off-balance sheet transactions
reported under the same heading in the Notes to the
consolidated financial statements.
58
-
-
-
Department heads are in charge of anticipating,
preventing and managing the main occurrences that
could affect the attainment of their business
objectives
and
the
underlying
operational
processes ;
The Risk Manager sees to it that the Group’s risk
management guidelines and methods are incorporated
into decisionmaking and operational processes. He
monitors risk exposure and compliance with the
relevant limits, and reports on risk status to the
Bank/Group. Each Group entity has a Risk Control
and Management unit that reports regularly to the
Bank’s Risk Manager.
The Bank and its subsidiaries are a subgroup of
Edmond de Rothschild Holding SA (“the Holding
Company”), which controls the Edmond de
Rothschild Group (“the Edmond de Rothschild
Group”). As such the Holding Company is
regulated by FINMA on a consolidated basis. To
satisfy FINMA’s requirements regarding management
and control of the risks faced by the Edmond de
Rothschild Group, the Holding Company has set
up a Risk Council combining the heads of the risk
units of all the Edmond de Rothschild Group’s
entities, who together report to the Group’s Chief
Risk Officer. An operating charter was drafted for
this Council setting out certain guidelines that reflect
the Edmond de Rothschild Group’s Strategic Plan.
The charter is backed up by frequent exchanges
and
collaboration
between
the
Council’s
participants.
Interest rate and liquidity risks
The liquidity risk is the risk that the Group might not be
able to meet its present and future cash flow and collateral
requirements, whether expected or unexpected, without
harming its daily operations or financial situation. The
interest rate risk resides in the vulnerability of the Group’s
net worth or net interest margin to an adverse movement in
market interest rates.
The Bank and its subsidiaries take a prudent approach to
cash management, not only by choosing first-class
counterparties but also by giving preference to overnight
and/or short-term deposits. Our emphasis is on safeguarding
our commitments to clients, in normal and stress
situations alike. We moreover seek to match resources to their
use, in terms of both duration and maturities. Finally, the Bank
and the Group scrupulously comply with the liquidity ratios
required by the current legal provisions.
The risks attaching to liquidity and interest rate positions/
maturities are gauged by using the most up-to-date balance
sheet management techniques and by tracking these items
with dedicated software. An Asset and Liability Management
(ALM) Committee drafts and oversees the implementation of
rules on managing liquidity, interest rate and forex risks. It is
also responsible for optimising cash management and
ensuring structural control of the balance sheet.
Credit risk
This is the risk that a client, bank or other counterparty might
not be able to honour an obligation towards the Group.
59
Counterparty banks
Market risk
The counterparty banks that the Group deals with are
selected rigorously and kept under close scrutiny. Our
exposure to them is monitored continuously by a team of
controllers, and the limits that we have granted to each are
updated periodically or in real time if so required by a
deteriorating situation. To minimise the counterparty risk
attaching to correspondent banks, we give preference to
reverse repo agreements and to depositing cash directly with
central banks. All the Group entities use the limits system and
monitor the risk of counterparty concentration.
This lies in the vulnerability of the Group’s financial situation to
adverse swings in market prices and especially in the underlying value and implied volatility of currencies, equities,
precious metals and commodities.
Securities dealing on a propriety basis forms a very small part
of the Group’s business. In currencies and precious metals
we chiefly operate on behalf of clients and build only small
nostro positions. The limits granted to traders are low, and
their use of these is monitored constantly with software by
separate risk management and internal control services.
Clients
The credit facilities that we grant to clients are mainly shortterm advances secured by their investments and, to a lesser
extent, loans in connection with their business activities.
Clients who have assets deposited with a Group entity may
also be granted a mortgage for the purchase of a primary
residence. Applications for credit facilities are subject to
stringent analysis, and the pledged securities are assigned a
collateral ratio according to their liquidity, valuation, credit
rating and diversification in terms of asset class and
geographical spread.
Daily monitoring of the client credit risk is handled by a special
team that also administers outstanding loans.
The Group’s financial services companies may invest part of
their capital and liquidity in first-class financial assets, Including
but not limited to bonds and other debt securities that meet
strict credit-rating standards. These Investments must be such
that they diversify the Group’s liquidity across medium- term
instruments while also garnering regular returns. They are
subject to specific limits and are chosen by employees of our
own a s s e t m a n a g e m e n t departments. Monitoring the
limits and portfolios is the responsibility of the ALM
Committee, to which reports are submitted regularly.
60
Operational risk
This is the risk of loss that the Group would suffer owing to the
inadequacy or failure of internal procedures, staff, IT systems
or external occurrences.
The Group’s entities have adopted a commune policy aimed
at monitoring and mitigating the following operational risks that
are Inherent in their private banking, asset management
and/or investment fund administration segments:
strategic and business risks,
internal and external fraud,
negligence regarding confidentiality and/or banking
secrecy protection requirements,
flawed practices in managing client assets and
collective investment schemes,
business disruptions resulting from system failures
and other extraordinary causes.
The Risk Control and Management Department has a unit
focused on operational risks that suggests ways to improve
our risk management and internal control capabilities. Its
responsibilities include:
-
devising the methodology for managing operational
risks (based primarily on the Basel II and III rules),
submitting this methodology to the Risk Committee
for approval and overseeing its implementation,
-
recording operational incidents, analysing them and
evaluating measures designed to prevent their
recurrence.
Outsourcing
Except in the area of fund administration support services
provided by Edmond de Rothschild (Europe), Luxembourg,
our Bank and its subsidiaries do not outsource services within
the meaning of FINMA circular 2008/7.
This unit is tied in with the Bank’s supervision and internal
control system. It collaborates closely with the Internal Control
Department in gauging the relevance and effectiveness of the
Group’s controls and action plans, with a view to mitigating
those risks that have been identified as high and/or critical. It
uses specially designed software deployed throughout the
Group. It reports to the Risk Committee periodically and, if
required by the circumstances, to the Executive Committee.
A business continuity and organisational plan has been drawn
up to deal with possible crisis situations that the Bank has
identified and that could totally or partially disrupt our
operational processes. Human and technical resources
including an entire infrastructure have been deployed that
would enable us to provide essential services at reduced
capacity and return to normal. Given our Bank’s objectives in
terms of business continuity following a disaster or major
incident, this plan and the related tests and drills will be further
developed in 2015.
61
1
Change
(in %)
201.4
19,358
6,423
Other bills and money market paper
87,698
152,040
-
107,056
158,463
(32.4)
Due from banks
Due from banks
Reverse repos
Total
3
2013
(in CHF ‘000)
Rescriptions and treasury bills
Total
2
2014
(in CHF ‘000)
Current account overdrafts
2014
2013
Change
(in CHF ,000)
(in CHF ,000)
(in %)
(64.0)
948,915
2,633,911
7,570,878
7,271,939
4.1
8,519,793
9,905,850
(14.0)
2014
2013
Change
(in CHF ,000)
(in CHF ,000)
(in %)
934,949
717,552
30.3
Advances and fixed term loans
1,487,295
971,775
53.0
Total due from customers
2,422,244
1,689,327
43.4
70,784
44,636
58.6
2,493,028
1,733,963
43.8
Mortgage loans
Total
Current account overdrafts, advances and fixed term loans and mortgage loans are shown at face value, less any required adjustments.
62
4
Mortgage
collateral
Other collateral
Unsecured
Total
13,378
2,285,448
123,418
2,422,244
Schedule of collateral (in thousands of CHF)
Loans
Due from customers
Mortgage loans
70,784
-
-
70,784
Total 2014
- residential property
84,162
2,285,448
123,418
2,493,028
Total 2013
52,860
1,604,061
77,042
1,733,963
-
174,655
10,761
185,416
-
128,935
2,772
131,707
-
-
-
-
Total 2014
-‐
303,590
13,533
317,123
Total 2013
-‐
251,080
11,010
262,090
Gross value
Estimated
proceeds from
sale of collateral
Net value
Individual
valuation
adjustments
Total 2014
12,337
-
12,337
12,335
Total 2013
9,372
-
9,372
9,349
Nonperforming loans (in thousands of CHF)
Delinquent claims, i.e. claims for which the borrower is unlikely to honour his future commitments, are evaluated on an individual basis and the resulting
depreciation is covered by itemised valuation adjustments. Off-balance sheet transactions, primarily involving contingent liabilities, guarantees and derivative
instruments, are also included in this review. A claim is deemed delinquent when there is substantive evidence that future principal and interest payments due
under contract are unlikely to be made or are over 90 days in arrears. Interest is deemed in arrears when overdue for more than 90 days. Nonperforming
loans and overdue interest do not appear in the profit and loss account, but are reported instead in “Valuation adjustments and provisions”.
63
5
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
4,141
3,465
19.5
4,111
3,465
18.6
11,874
16,313
(27.2)
-
-
-
16,015
19,778
(19.0)
Securities and precious metals trading portfolios
Debt instruments
of which: - listed
Equity paper
Precious metals
Total
Securities are reported at their fair value on the balance sheet date (securities traded on a recognised Stock Exchange or representative market; if these
conditions are not fulfilled, the securities are evaluated at their lowest quoted price); capital gains and losses are recorded under “Results of trading
operations”.
Regarding balance sheet reporting of treasury stock, see Note 17.
6
Total
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
721,026
754,820
(4.5)
2014
Debt instruments
2013
Book value
Fair value
Book value
Fair value
272,233
281,169
278,872
295,083
of which: - intended to be held until maturity
201,304
208,225
215,060
230,510
- reported as per lowest valuation
70,929
72,944
63,812
64,573
32,460
39,777
53,598
60,588
-
-
-
-
416,333
416,333
422,350
422,350
Equity paper
of which: - qualifying equity stakes (min. 10% of capital or votes)
Precious metals
Buildings
of which: - securities eligible for repo agreements under liquidity regulations
-
-
-
-
721,026
737,279
754,820
778,021
112,306
-
163,367
-
Interest-bearing securities that are intended to be held until maturity are evaluated using the accrual method. Capital gains and losses are calculated for the
duration of issues, i.e. until their redemption date. Interest-bearing securities that are not intended to be held until maturity appear at their lowest valuation.
When the market value of listed securities is below their acquisition price or when the price of unlisted securities is below the net asset value of the issuing
company, the difference is charged to “Other ordinary expenses”. Precious metals held to set off commitments towards clients are stated at their fair value.
Regarding balance sheet reporting of treasury stock, see Note 17.
64
7
Non-consolidated holdings
With market value
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
14,266
14,266
0
101,568
83,185
22.1
115,834
97,451
18.9
Holdings valued as per the equity method
38,135
43,453
(12.2)
Other non-consolidated holdings
77,699
53,998
43.9
115,834
97,451
With no market value
Total
“Holdings valued as per the equity method” includes significant interests owned by the Group (20-50% of the relevant company’s share capital).
Differences arising from the first equity consolidation:
- positive, included under “Retained earnings”
- negative, shown under “Intangible assets”
2,365
2,365
-
1,128
Companies consolidated on the balance sheet using the equity method:
- La Edmond de Rothschild Asset Management (Switzerland)SA, Meyrin, owned by:
Banca Privata Edmond de Rothschild Lugano SA, Lugano (17.34%)
and Edmond de Rothschild (Suisse) SA, Geneva (17.34%)
Total share capital CHF 11,534,000.–
- ACH Management SA, Luxembourg, owned by:
Edmond de Rothschild (Suisse) SA, Geneva (28%),
Edmond de Rothschild Capital Holdings Ltd, London (10%)
Total share capital USD 154,128
- LCF EdR Nikko Cordial, Japan, owned by:
Edmond de Rothschild (Switzerland) Europe, Luxembourg (50%)
Total share capital JPY 100,000,000
LCH Investment NV, Netherlands Antilles, owned by:
Edmond de Rothschild (Suisse) SA, Geneva (43.5%)
Edmond de Rothschild Limited, London (0.5%)
Total share capital USD 2,000
Due from or to holdings consolidated using the equity method:
Due from customers
Adjustments accounts
60
-
238
848
Other assets
31
-
Total assets
329
848
Due to banks
-
-
2,617
4,635
Other liabilities
11,350
389
Total liabilities
13,967
5,024
(61.2)
178.0
The other equity stakes are evaluated at their acquisition price less any write-offs to allow for long-term capital losses. Other capital losses are shown in the
balance sheet as “Valuation adjustments and provisions” and in the relevant item of the profit and loss account.
65
Acquisition value
at 1 January 2014
8
Accumulated
depreciation
at 1 January 2014
Group value
at 1 January 2014
Schedule of non-current assets (in thousands of CHF)
Holdings consolidated using the equity method
43,453
-
43,453
Other holdings
54,448
(450)
53,998
97,901
(450)
97,451
220,242
(56,984)
163,258
Bank premises
Other buildings
13,200
(4,609)
8,591
Other fixed assets
351,556
(290,721)
60,835
Total fixed assets
584,998
(352,314)
232,684
Goodwill
86,443
(77,171)
9,272
87,163
(87,163)
-
173,606
(164,334)
9,272
Intangible assets
2014
2013
(in CHF ‘000)
(in CHF ‘000)
Fire insurance value of bank premises
Fire insurance value of other buildings
172,147
13,729
187,550
13,631
Fire insurance value of other fixed assets
124,659
125,843
-
-
Commitments: future leasing instalments under operating leases
Fixed assets
Goodwill
Increases and decreases in the value of holdings consolidated
using the equity method are shown under “Investments” and
“Divestitures” respectively.
If the cost of an acquisition exceeds the net value of its assets as
Investments in new fixed assets which are to be used for more than
one financial year and exceed the balance-sheet reporting
threshold are stated at their purchase value. Investments in existing
fixed assets are reported as assets if their market or usage value
increases for an extended period or if their useful life increases
significantly.
company’s first-time full consolidation or consolidation at equity are
assessed according to the Group principles, the difference is considered
goodwill and stated in the balance sheet. The differences arising from a
amortised in the profit and loss account over a five-year period.
Other intangible assets when acquired are reported in the balance sheet
Fixed assets are reported in subsequent years at their purchase value
less accumulated depreciation. They are written down according to a
predetermined schedule throughout their useful life, and the correctness
of their value is reviewed each year. If this assessment reveals a
change in an asset’s projected useful life or a decrease in its actual
worth, the residual book value is either amortised as per the new
schedule or written down accordingly at the end of the reporting
period. Planned and additional unplanned write-downs are stated as
expenses under “Depreciation of fixed assets” in the profit and loss
account. If the reason for a write-down ceases to exist, the relevant
asset is re-evaluated.
Land and buildings are amortised on a straight-line basis over their
useful life, set at 66 years.
Other fixed assets comprising furniture, equipment and fixtures
(including renovations) are amortised on a straight-line basis over a
useful life, set at two to five years depending on their nature.
Profits on sales of fixed assets are included in “Extraordinary income”
and losses in “Extraordinary expenses”.
66
if it is believed that they will provide the Group with financial benefits over
a number of years. Other intangible assets created by the Group itself do
not appear at their fair value; following their valuation, they are reported in
the balance sheet at their purchase price and amortised in the profit and
loss account at their residual value over a five-year useful life. The
currency of the residual value is reviewed each year. If this review reveals
a change in the duration of their useful life or a decrease in their actual
worth, the Group amortises the residual book value in accordance with
the new useful life or by means of an unplanned write-down.
Forex adjustments
Redesignations
Investments
and newly consolidated
assets
Divestitures
and assets
no longer consolidated
Depreciation
including
changes in scope of
consolidation
Group value at
31 December 2014
15
-
40
(5,373)
-
(83)
-
24,284
(120)
(380)
38,135
77,699
(68)
-
24,324
(5,493)
(380)
115,834
(334)
-
331
-
(4,089)
159,166
-
-
-
-
(258)
8,333
(152)
-
38,610
(440)
(30,484)
68,369
(486)
-
38,941
(440)
(34,831)
235,868
-
-
3,155
-
(2,022)
10,405
(2)
-
180
-
(59)
119
(2)
-
3,335
-
(2,081)
10,524
67
9
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
263,504
139,048
89.5
-
8
(100.0)
Other assets
Positive replacement value of derivative instruments
Set-off account
Other
Total
33,510
31,070
7.9
297,014
170,126
74.6
2014
2013
Book value
of assets
Actual
encumbrance
Book value
of assets
Actual
encumbrance
22,622
-
20,103
-
10 Assets pledged or assigned to cover own liabilities
and assets subject to reservation of ownership (in thousands of CHF)
Securities pledged to a Stock Exchange to cover settlements
Other
500
-
2,000
-
Assets pledged or assigned to cover own liabilities
23,122
-
22,103
-
Total encumbrances covering own liabilities
23,122
-
22,103
-
2014
2013
Claims arising from cash pledged as collateral under securities borrowing and reverse repo agreements
7,570,878
7,271,939
Securities received as collateral under securities lending agreements and securities received under borrowing
or reverse repo agreements which the Bank has been authorised without restriction to sell or pledge subsequently
7,708,141
7,524,538
-
-
Securities lending and repurchase agreements
of which: - those of the above securities which were sold or pledged
The fees earned or paid as a result of securities lending are reported as per the duration of the loan and appear respectively as interest income or interest
charges. Repos and reverse repos are used to finance and refinance the purchase of special kinds of equities. They are stated as loans secured by financial
instruments or as deposits secured by shares from the Bank’s treasury stock. They are stated as advances secured by securities or as deposits for which
the Bank has pledged securities. The interest income arising from reverse repos and the interest charges arising from repos are reported as per the duration
of the relevant transactions.
11 Disclosure of commitments to own pension plans
Total
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
58,508
50,128
16.7
Commitments to own pension plans (joint and employer foundations alike) are stated under “Other amounts due to customers”.
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
233,725
136,557
71.2
23
99
(76.8)
86,710
63,718
36.1
320,458
200,374
30.5
12 Other liabilities
Negative replacement value of derivative instruments
Set-off account
Other
Total
For 2013 the “Other” line mainly includes the profit generated by the creation of the joint venture described on p. 52 in the “Consolidation principles” section.
68
Situation at
end 2013
Uses
Changes in
and
scope of
releases as consolidation
designated
Recoveries,
New
interests at
provisions
risk and
charged to
forex profit and loss
differences
account
Releases Situation at
reported in end 2014
profit and
loss account
13 Valuation adjustments and provisions
Reserves for general banking (in thousands of CHF)
Provisions for taxes and deferred taxes
Valuation adjustments and provisions for default
and other risks:
- valuation adjustments and provisions for default risks
(credit and country risks)
- provisions for restructuring
- other provisions
Subtotal
Total valuation adjustments and provisions
26,880
-
-
(143)
401
(5,075)
22,063
12,849
(252)
-
83
3,204
(49)
15,835
-
-
-
(4)
376
-
372
75,735
(12,120)
-
(378)
26,616
(668)
89,185
88,584
(12,372)
-
(299)
30,196
(717)
105,392
115,464
(12,372)
-
(442)
30,597
(5,792)
127,455
9,346
12,333
9,346
12,333
Total valuation adjustments and provisions
as per balance sheet
106,118
115,122
262,152
Less valuation adjustments deducted directly from assets:
Of which:- customers
Reflecting the Group’s cautious stance, valuation adjustments and provisions
are allocated on an individual basis to all discernible risks of loss. Valuation
adjustments and provisions that become economically unnecessary during the
course of a financial year are released and reported under the relevant heading
in the profit and loss account. Individual valuation adjustments are deducted
from the relevant balance sheet items.
Deferred taxes mainly relate to temporary changes in reserves for general
banking risks. They are calculated based on the average tax rate foreseen at
the time the balance sheet is drawn up.
Reserves for general banking risks form part of consolidated shareholders’
equity. The portion accruing to the Group minority shareholders is deducted
from these reserves.
-
-
-
952
(20,975)
242,129
Litigation
The Group is involved in a number of judicial proceedings in relation to its
normal business. The general business environment entails certain legal risks
whose impact on our financial situation and profitability is difficult to gauge at
the current stages of these proceedings. In line with our policy, the Group
creates provisions for pending or contingent procedures when senior
management believes that these could give rise to a loss or a financial liability,
or when the dispute is likely to be settled in the form of a transaction and the
amount of the obligation or loss can be reasonably estimated. For certain
procedures, however, the Group is not able to reasonably estimate the size of
the loss, for example because of the complexity of the proceedings, the fact
that they are only at a preliminary stage, the uncertainty they entail or for other
objective reasons. The foregoing valuation adjustments moreover include the
instalment provided for under the tax agreement between Switzerland and the
UK and provisions relating to the Bank’s participation in the tax settlement
programme of the US Department of Justice, in line with the recommendations
of the Swiss Financial Market Supervisory Authority (FINMA).
69
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
200,000 fully paid registered shares with a par value of CHF 100.–
20,000
20,000
-
50,000 fully paid bearer shares with a par value of CHF 500.–
25,000
25,000
-
45,000
45,000
-
80,454
41,139
14 Share capital
Total
see note 17 for equities held for own account
Due to and from qualifying shareholders:
Due from customers
Other assets
326
224
Total claims
80,780
41,363
16,647
11,596
Adjustment accounts
Other liabilities
Total liabilities
15 Retained earnings and other reserves excluding minority states
Retained earnings
Passive difference from consolidation and equity consolidation
Accrued currency translation differences
Total
16 Minority interests in shareholders’ equity
Retained earnings
Passive difference from consolidation and equity consolidation
Total
70
95.3
2,347
-
-
6
18,994
11,602
63.7
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
969,549
966,671
0.3
4,490
6,793
(33.9)
(88,780)
(84,043)
5.6
885,259
889,421
(0.5)
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
44,801
44,122
1.5
(10,155)
(10,549)
(3.7)
34,646
33,573
3.2
2014
2013
(in CHF ‘000)
(in CHF ‘000)
Share capital
45,000
45,000
Additional paid-in capital
91,455
92,096
922,994
912,614
(94,592)
(100,207)
262,152
287,423
17 Statement of changes in shareholders’ equity
Share capital at beginning of year
Retained earnings at beginning of year (including minority interests’ share in shareholders’ equity)
of which: -currency translation differences
Group net income
Treasury stock
Total shareholders’ equity at beginning of the reporting period
Capital increase/decrease
75,423
66,351
(68,234)
(66,045)
1,328,790
1,337,439
-
-
Allocations to/releases from reserves for general banking risks
(20,023)
(25,271)
Dividend
(56,250)
(56,250)
Other allocations to/releases from retained earnings
(17,919)
(5,337)
63,182
75,423
Net income
Treasury stock buybacks (at purchase price)
(127)
(16,805)
Sales of treasury stock (at purchase price)
885
14,617
Profit or loss on sales of treasury stock
142
(641)
(4,343)
5,615
1,294,337
1,328,790
45,000
45,000
Currency translation differences
Total shareholders’ equity at end of the reporting period
of which: - share capital
- additional paid-in capital
- retained earnings (including minority interests’ share in shareholders’ equity)
of which: - currency translation differences
- reserves for general banking risks
- Group net income
of which: - minority interests’ share in net income
Treasury stock
91,597
91,455
919,905
922,994
(98,935)
(94,592)
242,129
262,152
63,182
75,423
9,404
11,899
(67,476)
(68,234)
The minority shareholders are considered as providers of funds to the Group. As a consequence, their interest is treated as Group equity. Similarly, net
income attribuable to minority interests is included in consolidated net income.
2014
2013
(number
of shares)
(number
of shares)
149
140
Own shares deducted from shareholders’ equity:
Treasury stock included in securities and precious metals trading portfolio
- number of own shares at 1 January 2014
- number of shares purchased during the reporting year
- number of shares sold during the reporting year
- number of own shares at 31 December 2014
Treasury stock reported as financial investments
- number of own shares at 1 January 2014
- number of shares purchased during the reporting year
- number of shares sold during the reporting year
- number of own shares at 31 December 2014
8
195
(8)
(186)
149
149
2014
2013
(number
of shares)
(number
of shares)
2,805
2,696
-
650
(59)
(541)
2,746
2,805
71
On
demand
Callable
Within In 3 to 12
In 12
3 months
months months to
5 years
After 5
years
Total
4,364,274
18 Maturity profile of current assets, financial investments and
borrowed funds (in thousands of CHF)
Current assets
Due from banks
Due from customers
Mortgage loans
Securities and precious metals held for trading purposes
4,364,274
-
-
-
-
-
-
-
94,291
12,765
-
-
107,056
- 7,734,032
123,904
-
-
8,519,793
661,857
12,858
934,948
663,368
692,937
114,526
3,607
2,422,244
-
341
4,983
19,425
46,035
-
70,784
16,015
-
-
-
-
-
16,015
448,791
-
11,607
18,413
195,841
46,374
721,026
Total 2014
5,503,795
935,289 8,508,281
867,444
356,402
49,981
16,221,192
Total 2013
4,344,343
718,383 9,935,797
631,137
298,915
42,059
15,970,634
Borrowed funds
Due to banks
Due to customers on savings or deposit accounts
72
1,237
90
-
-
-
-
1,327
240,982
-
7,388
9,617
-
-
257,987
-
6,640
-
-
-
-
6,640
85
351,184
165,324
26,481
-
14,765,255
14,222,181
Total 2014
14,464,400
6,815
358,572
174,941
26,481
-‐
15,031,209
Total 2013
14,359,031
10,708
205,043
163,952
13,425
-‐
14,752,159
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
138,692
124,682
6,120
3,576
19 Due from and to affiliated companies
Due from banks
Adjustment accounts
Other assets
624
2,460
Total claims
145,450
130,718
Due to banks
89
1,471
4,511
17,962
Adjustment accounts
3,290
411
Other liabilities
6,694
1,526
14,584
21,370
Total commitments
11.3
(31.8)
Affiliated companies include the majority holdings of Edmond de Rothschild Holding SA, which are not part of the Edmond de Rothschild (Switzerland) Group.
All transactions with affiliated parties are carried out on the usual terms, both at the Bank in Switzerland and at our foreign subsidiaries.
2014
2013
Loans
Number of
members
Loans
Number of
members
81,876
4
43,134
4
-
-
40
2
81,876
4
43,174
6
Commitments
Number of
members
Commitments
Number of
members
236
3
451
7
34
2
128
5
28
3
54
6
298
8
633
18
20 Loans granted to the governing bodies of the Bank
Guarantee commitments on behalf of the governing bodies of the Bank
Loans granted to the governing bodies (in thousands of CHF)
- to members of boards of directors
- to members of the executive committee
Total
Guarantee commitments on behalf of the following persons
(in thousands of CHF)
- members of boards of directors
- members of the executive committee
- internal auditors
Total
73
2014
21
2013
Swiss
Foreign
Total
Swiss
Foreign
Total
3,626,338
737,936
4,364,274
2,908,469
489,291
3,397,760
-
107,056
107,056
228
158,235
158,463
Due from banks
751,054
7,768,739
8,519,793
814,417
9,091,433
9,905,850
Due from customers
225,362
2,196,882
2,422,244
211,495
1,477,832
1,689,327
55,975
14,809
70,784
38,136
6,500
44,636
3,375
12,640
16,015
3,019
16,759
19,778
516,316
204,710
721,026
546,859
207,961
754,820
62,874
52,960
115,834
67,691
29,760
97,451
Breakdown of Swiss and foreign assets and
liabilities (in thousands of CHF)
Assets
Mortgage loans
Securities and precious metals held for trading
purposes
Fixed assets
174,466
61,402
235,868
179,137
53,547
232,684
Intangible assets
10,405
119
10,524
9,272
-
9,272
29,029
73,619
102,648
13,497
93,334
106,831
129,147
167,867
297,014
104,155
65,971
170,126
5,584,341
11,398,739
16,983,080
4,896,375
11,690,623
16,586,998
1,327
-
1,327
3,607
-
3,607
21,027
236,960
257,987
17,200
299,612
316,812
5,998
642
6,640
6,255
650
6,905
1,621,776
13,143,479
14,765,255
1,765,227
12,659,608
14,424,835
95,376
126,578
221,954
76,664
122,893
199,557
162,429
158,029
320,458
56,682
143,692
200,374
86,652
28,470
115,122
80,024
26,094
106,118
190,577
51,552
242,129
208,037
54,115
262,152
45,000
-
45,000
45,000
-
45,000
Other assets
Total assets
Liabilities
Due to banks
Customer savings and deposit accounts
Other liabilities
Share capital
90,387
1,210
91,597
90,524
931
91,455
Retained earnings
666,115
219,144
885,259
652,293
237,128
889,421
Treasury stock
(67,476)
-
(67,476)
(68,234)
-
(68,234)
587
34,059
34,646
-
33,573
33,573
3,112
60,070
63,182
(5,393)
80,816
75,423
2,922,887
14,060,193
16,983,080
2,927,886
13,659,112
16,586,998
Minority interests’ share in shareholders’ equity
Total liabilities
The breakdown of Swiss and foreign origin is based on the location of the registered office of the debtor, creditor or the body issuing the shares or debt
instruments. In the case of mortgage-backed securities and property, the place of the security interest applies.
74
2014
2013
Value
% share
Value
% share
5,584,341
32.9
4,896,375
29.5
22 Breakdown of consolidated assets by country/country group
Assets
Switzerland
Europe excluding Switzerland
10,388,056
61.1
11,075,086
66.9
North America
182,469
1.1
178,271
1.1
South America
44,690
0.3
57,658
0.3
Asia / Pacific
277,383
1.6
54,447
0.3
Caribbean
320,360
1.9
222,829
1.3
Africa Middle East
185,781
1.1
102,332
0.6
16,983,080
100.0
16,586,998
100.0
Total assets
75
CHF
EUR
3,624,207
732,168
-
48,090
19,489
3,113,969
235,459
1,424,115
USD
Other
Total
329
7,570
4,364,274
41,094
17,872
107,056
4,627,136
759,199
8,519,793
510,848
251,822
2,422,244
23 Breakdown of consolidated assets and liabilities by currency
Assets
Due from banks
Due from customers
Mortgage loans
Fixed assets
65,875
-
-
4,909
70,784
247
2,835
5,805
7,128
16,015
221,905
66,448
15,885
416,788
721,026
99,920
13,061
276
2,577
115,834
180,222
43,155
-
12,491
235,868
Intangible assets
10,405
119
-
-
10,524
29,933
59,594
7,846
5,275
102,648
132,470
160,181
11
4,352
297,014
Other assets
Total positions reported as assets
4,620,132
5,663,735
5,209,230
1,489,983
16,983,080
Delivery claims arising from spot, forward and options transactions
3,571,959
11,451,855
11,854,193
2,884,833
29,762,840
Total assets 2014
8,192,091
17,115,590
17,063,423
4,374,816
46,745,920
Total assets 2013
6,072,559
15,465,381
12,754,519
4,354,977
38,647,436
1,327
-
-
-
1,327
13,527
66,551
148,471
29,438
257,987
Liabilities
Due to banks
Customer savings and deposit accounts
Other liabilities
-
-
-
6,640
5,966,954
5,634,728
1,584,980
14,765,255
90,688
107,530
2,482
21,254
221,954
170,357
115,443
589
34,069
320,458
86,663
28,160
299
-
115,122
190,577
51,552
-
-
242,129
Share capital
45,000
-
-
-
45,000
90,666
-
931
-
91,597
Retained earnings
701,509
153,532
(586)
30,804
885,259
Treasury stock
(67,476)
-
-
-
(67,476)
858
24,917
(39)
8,910
34,646
(5,745)
74,336
(526)
(4,883)
63,182
Total positions reported as liabilities in reporting year
2,903,184
6,588,975
5,786,349
1,704,572
16,983,080
Delivery commitments arising from spot, forward and options transactions
5,288,691
10,416,917
11,417,881
2,639,351
29,762,840
Total liabilities 2014
8,191,875
17,005,892
17,204,230
4,343,923
46,745,920
216
109,698
(140,807)
30,893
-
6,074,997
15,419,141
12,795,704
4,357,594
38,647,436
Minority interests’ share in shareholders’ equity
Net position per currency
Total liabilities 2013
76
6,640
1,578,593
24
Irrevocable guarantees in the form of avals, sureties and guarantees (including guarantee
commitments under irrevocable letters of credit), advance payment guarantees and
endorsement obligations from rediscounting
Performance bonds, bid bonds, letters of indemnity and other service guarantees (including
service guarantees in the form of irrevocable letters of credit)
Total
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
105,930
121,845
(13.1)
79,486
71,950
10.5
185,416
193,795
(4.3)
For guarantee commitments made on behalf of the Bank’s governing bodies, see Note 20. These commitments are reported in “Off-balance sheet
transactions” at their face value. For foreseeable risks, the Group allocates provisions in its balance-sheet liabilities.
25 Guarantee commitments for third parties
Surety bonds
Guarantees
Total
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
(3.1)
3,884
4,010
181,532
189,785
(4.3)
185,416
193,795
(4.3)
77
Trading instruments
Positive
replacement
values
Negative
replacement
values
Hedging instruments
Underlying
values
Positive
replacement
values
Negative
replacement
values
Underlying
values
26 Open interest in derivative instruments
Interest rate products
Forward contracts including FRAs
-
-
-
-
-
-
Swaps
-
2,353
39,317
-
-
-
Futures
-
-
-
-
-
-
OTC options
-
-
-
-
-
-
Traded options
-
-
-
-
-
-
186,671
196,064
15,059,377
-
-
-
74,184
32,700
5,138,101
-
-
-
-
-
-
-
-
-
2,358
2,358
172,755
23
-
12,024
-
-
-
-
-
-
Currencies / precious metals
Forward contracts
Combined interest and currency swaps
Futures
OTC options
Traded options
Equity index products
Forward contracts
267
249
18,055
-
-
-
Futures
-
-
-
-
-
-
OTC options
1
1
76,312
-
-
-
Traded options
-
-
-
-
-
-
Forward contracts
-
-
-
-
-
-
Futures
-
-
-
-
-
-
OTC options
-
-
-
-
-
-
Traded options
-
-
-
-
-
-
2014
263,481
233,725
20,503,917
23
-
12,024
2013
138,949
136,549
22,119,560
99
8
17,802
Other
Total before impact of netting agreements
Positive replacement values (accumulated)
Negative replacement values (accumulated)
2014
263,504
233,725
2013
139,048
136,557
Total after impact of netting agreements
The derivative instruments used by the Group include exchange-traded futures, OTC forwards, exchange-traded options, OTC options and swaps.
Derivative instruments are traded by the Group on behalf of clients and on a proprietary basis. Transactions involving options, futures and swaps for our own
account are used to hedge financial investments and to control interest rate and currency risks.
Derivative instruments are reported at their fair value. The positive and negative replacement values represent the Bank’s claims and obligations respectively,
should the Bank enter into contracts identical to the initial ones with other counterparties. The positive and negative replacement values are shown in the
balance sheet under “Other assets” and “Other liabilities” respectively, and in the profit and loss account under “Results of trading operations”. The fair value
is either the market price (if the instrument is traded on an efficient, liquid market), the price quoted by market makers or the price determined using valuation
models. The underlying value represents the net claim arising from trading in derivative instruments for own account or on behalf of customers (contract
value).
(Note 26 cont’d next page)
78
(note 26 cont’d)
2014
26
2013
Positive
replacement
values
Negative
replacement
values
Underlying
values
Positive
replacement
values
Negative
replacement
values
Underlying
values
121,754
143,336
11,641,999
98,902
42,737
11,934,709
-
2,364
1,204
87
284
7,500
Secured customers
141,750
88,025
8,872,738
40,059
93,535
10,195,153
Total
263,504
233,725
20,515,941
139,048
136,557
22,137,362
Open interest in derivative
instruments (in thousands of CHF)
Banks and derivative exchanges
- expiring in less than 1 year
- expiring in more than 1 year
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
3,004,965
3,101,218
(3.1)
149,605
89,056
68.0
3,154,570
3,190,274
(1.1)
27 Fiduciary transactions
Fiduciary deposits with other banks
Fiduciary loans
Total
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
Assets invested in funds managed by the Bank
16,177,750
16,029,135
0.9
Assets under discretionary management
21,906,850
19,834,184
10.4
Other assets
71,377,876
72,748,179
(1.9)
28 Assets under management
Total assets under management (incl. double reporting)
109,462,476 108,611,498
of which: - double reporting
- net deposits/withdrawals of fresh money
0.8
8,697,640
10,213,007
(14.8)
(2,906,476)
1,585,013
(283.4)
Assets under management include investments in funds managed by the Bank, assets held under discretionary management mandates (including under
custody with depositaries) and other assets held for investment purposes (“Other assets”).
Assets under custody are owned by institutional clients whose only objective is to hold deposits.
“Net deposits/withdrawals of fresh money” includes account openings and closures as well as deposits and withdrawals by existing clients. Changes in
assets due to performance (e.g. price variations, interest and dividend payments and bank charges) are not considered to be deposits/withdrawals.
29 Interest and discount income
Due from banks
of which: - reverse repo interest
Total
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
20,552
18,078
13.7
10,553
10,645
(0.9)
420
583
(28.0)
22,899
18,672
22.6
43,871
37,333
17.5
94
95
(1.1)
4,530
5,003
(9.5)
79
30
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
To banks
3,042
1,283
137,1
On customer deposits
4,629
4,108
12,7
7,671
5,391
42.3
Interest payable
Total
31 Commission income on securities and investment transactions
Total
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
567,591
537,357
5.6
This heading covers brokerage fees, custody fees, management fees, advisory fees and commissions on investment activities (fiduciary loans and deposits,
gold, currency options, futures, investment trusts, securities transfers and new issues).
32 Commission income on other service operations
Total
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
60,753
75,243
(19.3)
Commissions on other services consist of administration fees charged to customers and commissions for safe rentals, money transfers, cheques and other
services.
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
Securities trading (including equity product and index derivatives)
17,826
22,933
(22.3)
Forex trading (including forex derivatives)
55,528
59,664
(6.9)
456
951
(52.1)
79,210
83,548
(5.2)
33 Results of trading operations
Precious metals (including precious metals derivatives)
Total
Income and expenses arising from trading portfolios – profits and losses on trades, along with interest and dividends – are included in “Results of trading
operations”. The Group does not debit portfolio refinancing costs to these results. Results of securities lending and borrowing appear in
“Interest
income, net”.
34 Other ordinary income
This heading mainly covers fees received, coupon collection income and VAT refunds.
80
Total
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
26,032
20,922
24.4
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
295,598
321,047
(7.9)
- statutory social security
35,461
25,734
37.8
- contributions to pension funds
28,536
31,010
(8.0)
12,276
15,339
(20.0)
371,871
393,130
(5.4)
35 Personnel expenses
Salaries
Employee benefits:
Other personnel expenses
Total
“Salaries” covers the payroll of permanent and temporary staff, plus
bonuses, fees paid to directors and supplementary allowances.
Personnel welfare plans
The staff of the parent company and some of its subsidiaries is insured
by the Edmond de Rothschild Personnel Welfare Foundation. Its purpose
is to protect the staff of its member companies from the economic
consequences of old age, disability and death. The Foundation is semiautonomous
and
operates
as
a
defined-contributions
scheme.
Contribution rates increase with age. Employers pay in two-thirds of
contributions and employees one-third.
The audited funding ratio of the new Foundation at 31 December 2013
was 105.81% (101.66% at 1 January 2013).
Thanks to last year’s positive return on the Foundation’s assets, we can
estimate a funding ratio above 106% at end-2014. The Foundation
Council decided to pay 3% interest on active members’ vested assets for
2014 and also decided not to index existing pensions.
The Board of Directors believes that any funding ratio surplus as defined
in RPC 16 of the Swiss GAAP will be used for the benefit of employees
and that, as a consequence, no profit will arise for the member
companies.
The employees of other Group entities belong to personnel welfare funds
that also operate on the defined-contributions principle.
At 31 Dec. 2014 there was no employer contributions reserve.
81
(Note 35 cont’d)
2013
2013
Funding
surplus /
deficit
2012
2014
Entity’s share
Change
v.previous year
Period
adjusted
contributions
2013
Personnel welfare costs
included in personnel expenses
Economic benefits / commitments and personnel welfare expenses
Employer’s funds / Employer’s
personnel welfare institutions
Personnel welfare institutions
with a surplus funding ratio
Personnel welfare institutions
with no proprietary assets
-
-
-
-
6,212
6,212
6,421
28,364
-
-
-
22,324
22,324
24,589
-
-
-
-
-
-
-
28,536
28,536
31,010
Total
2014
2013
In Switzerland
In EU
Other
countries
In EU
Other
countries
Total
Average number of employees
718
945
74
1,737
Total number of employees
at year-end
732
1,005
68
1,805
721
881
79
1,681
726
982
69
1,777
Number of employees at yearend, converted into full-time jobs
697
859
79
1,635
698
949
69
1,716
Total In Switzerland
Group personnel
(number of employees)
36 Other operating expenses
Cost of premises
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
26,690
27,692
(3.6)
5.7
Equipment costs:
- IT systems
35,562
33,643
- machines
769
749
2.7
- furniture
709
916
(22.6)
(76.9)
- vehicles
Other operating expenses:
Total
82
125
541
87,494
89,990
(2.8)
151,349
153,531
(1.4)
37 Depreciation of non-current assets
Consolidated holdings
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
380
-‐
(3.8)
Fixed assets:
- land ans buildings
- office furniture, machines and equipment
Intangible assets
Total
4,347
4,517
30,484
30,511
(0.1)
2,081
3,469
(40.0)
37,292
38,497
(3.1)
In the case of non-consolidated holdings shown at cost, only provisions for permanent capital depreciation are shown under this heading; see Note 7.
Depreciation of fixed assets is set out in Note 8.
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
30,155
46,175
(34.7)
38 Valuation adjustments, provisions and losses
Losses
Total
11,691
7,076
65.2
41,846
53,251
(21.4)
The breakdown of funds allocated to valuation adjustments and provisions is shown in Note 13.
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
25,160
59,562
(57.8)
1,411
6,597
(78.6)
39 Extraordinary income and expenses
“Extraordinary income” mainly derives from the release of other provisions that are no longer required for operating purposes and a release from the general
reserve for banking risks.
“Extraordinary expenses” mainly includes allocations in 2014 and 2013 of CHF 1.0 million and CHF 5.1 million respectively to the reserve for general banking
risks.
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
20,631
20,519
0.5
(4,674)
(8,445)
(44.7)
15,957
12,074
32.2
40 Taxes
Current taxes
Deferred taxes
Total
Corporate taxes are calculated on the basis of the financial statements of each individual Group company and charged to the accounting period in which
they were incurred. Tax provisions are set out in Note 13.
41 Consolidated net income
Total
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
63,182
75,423
(16.2)
The share of minority interests in net income is incorporated in consolidated net income based on the Group unity principle explained in Note 17.
83
2014
2013
53,705
63,524
50,000
50,000
42 Earnings per share
Group earnings after deduction of portion due to minority interests (in thousands of CHF)
Weighted average of number of shares outstanding
Bearer shares (par value CHF 500.–)
200,000
200,000
Weighted average of number of shares used to calculate earnings per share (with a par value of CHF 500.–) after deducting
own shares held by the Bank (Treasury stock)
87,105
87,046
Earnings per bearer share (in CHF)
616.55
729.78
Earnings per registered share (in CHF)
123.31
145.96
Registered shares (par value CHF 100.–)
2014
2013
Swiss
Foreign
Total
Swiss
Foreign
Total
19,514
24,357
43,871
18,271
19,062
37,333
43 Breakdown of Group results by Swiss and foreign
origin (in thousands of CHF)
Interest payable
80
14
94
92
3
95
4,467
63
4,530
4,387
616
5,003
401
7,270
7,671
962
4,429
5,391
23,660
17,164
40,824
21,788
15,252
37,040
941
1,063
2,004
815
629
1,444
241,757
325,834
567,591
243,849
293,508
537,357
18,579
42,174
60,753
23,812
51,431
75,243
Commissions payable
40,972
93,304
134,276
43,473
63,293
106,766
220,305
275,767
496,072
225,003
282,275
507,278
34,385
44,825
79,210
37,842
45,706
83,548
828
(134)
694
925
1,418
2,343
14,782
6,651
21,433
17,945
4,717
22,662
792
248
1,040
963
329
1,292
9,470
16,562
26,032
6,868
14,054
20,922
7,349
208
7,557
1,612
532
2,144
18,523
23,119
41,642
25,089
19,986
45,075
Operating income
296,873
360,875
657,748
309,722
363,219
672,941
Personnel expenses
186,958
184,913
371,871
201,800
191,330
393,130
68,362
82,987
151,349
67,695
85,836
153,531
255,320
267,900
523,220
269,495
277,166
546,661
Gross profit
41,553
92,975
134,528
40,227
86,053
126,280
27,270
10,022
37,292
28,516
9,981
38,497
27,649
14,197
41,846
45,613
7,638
53,251
(13,366)
68,756
55,390
(33,902)
68,434
34,532
21,089
4,071
25,160
30,201
29,361
59,562
Commission income on trading operations and investments
Total income from holdings
Real estate income
Operating expenses
Taxes
315
1,096
1,411
1,198
5,399
6,597
4,296
11,661
15,957
494
11,580
12,074
3,112
60,070
63,182
(5,393)
80,816
75,423
This breakdown of results by Swiss and foreign origin is based on the location of business operations.
84
Financial Report
86
87
92
94
96
97
Key figures
on the financial statements
Balance sheet
85
Key figures
of Edmond de Rothschild (Suisse) SA, Geneva
2014
2013
Change
(in CHF ‘000)
(in %)
(27.0)
Balance sheet (in thousands of CHF)
Due from banks
2,705,567
3,704,248
(998,681)
1,125,430
737,526
387,904
52.6
926,281
1,172,265
(245,984)
(21.0)
5,828,721
5,623,180
205,541
3.7
632,890
636,563
(3,673)
(0.6)
7,936,090
7,895,928
40,162
0.5
Due to banks
Customer deposits
Shareholders’ equity (after appropriation)
Balance sheet total
Profit and loss account (in thousands of CHF)
19,873
17,754
2,119
11.9
188,304
191,874
(3,570)
(1.9)
31,839
34,759
(2,920)
(8.4)
Operating expenses (personnel costs and overheads)
250,876
262,103
(11,227)
(4.3)
Gross profit
102,792
92,033
10,759
11.7
Net income
69,226
50,650
18,576
36.7
657
648
9
1.4
10.9
7.8
-
-
0.9
0.6
-
-
56,250
56,250
-
-
125
125
-
-
1,374,750
1,287,000
87,750
6.8
- net income per share (CHF)
769
563
206
36.6
- dividend (CHF)
625
625
-
-
15,275
14,300
975
6.8
4.1
4.4
-
-
Staff
Number of employees at year-end (converted into full-time jobs)
Profitability
% return on equity (net profit / average shareholders’ equity after profit appropriation)
% return on assets (net profit / average assets)
Shares
Dividend (in thousands of CHF)
Dividend (% of share capital)
Stock market capitalisation (in thousands of CHF)
Data per bearer share:
- quoted price at 31.12 (CHF)
- gross yield (%)
86
to the shareholders of Edmond de Rothschild (Suisse) SA
at the ordinary general meeting on 29 April 2015
Balance sheet review
On the assets side, cash and claims arising from money
market paper totalled CHF 2.9 billion, up CHF 526 million
compared with 2013.
On the liabilities side, funds due to banks dropped by CHF
246 million to CHF 926.3 million, chiefly reflecting cash
management at the Edmond de Rothschild Group level.
Funds due from banks fell by CHF 998.7 million to CHF
2.7 billion, including CHF 2.5 billion held with correspondents
under reverse repo agreements.
At 31 Dec. 2014 client deposits totalled CHF 5.8 billion as
against 5.6 billion a year earlier. They accounted for 73.4% of
the balance sheet total.
Cash, bank deposits and money market claims together
came to CHF 5.6 billion. This item accounts for 70% of the
balance sheet total.
Other liabilities came to CHF 187.5 million.
Loans to clients rose to CHF 1.1 billion, marking a 52.6%
increase on the end-2013 level, and represented 14.2% of
the balance sheet total.
totalled CHF 2.9 million, up by 7.2% on the previous year’s
level.
Financial investments stood at CHF 614 million, practically
unchanged compared with the year-earlier figure.
Valuation adjustments, provisions and losses rose by CHF
10.2 million to CHF 219.8 million.
Following appropriation of net income, shareholders’ equity will
amount to CHF 632.9 million, or 8% of the balance sheet
total.
On that basis return on equity at end-2014 worked out to
10.9%. Applying the BIS rules under Basel III, required shareholders’ equity totalled CHF 114.5 million while eligible capital
came to CHF 456.1 million. The BIS ratio stood at 31.9%.
Long-term holdings amounted to CHF 254.3 million, as
against CHF 226.4 million in 2013.
Fixed assets came to CHF 154.2 million, marking a drop of
CHF 2.9 million.
Other assets amounted to CHF 198.2 million, compared with
CHF 109.9 million the previous year. This increase is due to
the change in the replacement value of currency transactions
that were open at the end of the reporting year.
At 31 December 2014, the balance-sheet total stood at
CHF 7.9 billion, up by CHF 40 million on the previous year.
Edmond de Rothschild (Suisse) SA has a particularly healthy,
liquid balance-sheet and can therefore face future
developments confidently.
87
Roundup of results
The Bank’s net profit at 31 Dec. 2014 came to CHF
69.3 million, marking an increase of 36.7% compared with the
year- earlier figure.
Revenue
Interest income rose 11.9% compared with the previous year,
totalling CHF 19.9 million.
Income from fees and commissions amounted to CHF
188.3 million, down 1.9% on the 2013 level of CHF 191.9
million.
Results of trading operations came to CHF 31.8 million,
compared with CHF 34.8 million the previous year.
Other ordinary results rose 3.6% to CHF 113.7 million. The
increase was due, in particular, to the change in value of our
treasury stock.
Expenses
Operating expenses totalled CHF 250.9 million, down 4.3%
on the 2013 level. Personnel expenses declined by 6.8% and
other operating costs were up by 2.8%.
At CHF 102.8 million gross profit was up 11.7% compared
with the year-earlier figure (CHF 92 million).
Depreciation of fixed assets totalled CHF 26.1 million, marking
a decrease of CHF 0.5 million on the previous year.
Valuation adjustments, provisions and losses fell by CHF 17.7
million from the end-2013 level to CHF 24 million.
Taxes due on our 2014 earnings are estimated at
CHF 5.7 million, down 0.9% on the year-earlier figure.
88
Approval of the financial statements
We hereby submit the financial statements for fiscal year 2014
for your approval, together with our proposal for the allocation
of available income.
Proposal of the Board of Directors
concerning the appropriation of earnings
Net income for 2014
CHF
69,226,351
Net income brought forward from previous year
CHF
4,006,272
Total
CHF
73,232,623
Allocation to statutory general reserves
CHF
Nil
Allocation to other reserves
CHF
12,048,847
Net income carried forward
CHF
4,933,776
Total
CHF
73,232,623
which we propose to appropriate as follows:
Payment of a 125% ordinary dividend on
200,000 registered shares with a par value of CHF 100
CHF 20,000,000 at 125%
CHF
25,000,000
CHF 25,000,000 at 125%
CHF
31,250,000
Total ordinary dividend
CHF
56,250,000
50,000 bearer shares with a par value of CHF 500
Subject to your acceptance of our proposal, the dividend will
be made payable on Coupon No. 28 from 7 May 2015 at all
the domestic counters of UBS, Credit Suisse, Rothschild
Bank AG and Edmond de Rothschild (Suisse) SA, at the rate
of CHF 125 per registered share with a par value of CHF 100
and CHF 625 per bearer share with a par value of CHF 500,
less 35% withholding tax.
Following the release of CHF 12,048,847 from other reserves,
shareholders’ equity will amount to CHF 632,890,624.- or
8.0% of the balance sheet total.
89
Elections as per our Articles of Association
Outlook for 2015
Under the OEPLC the General Meeting will henceforth elect
members to the Board of Directors individually for one-year
terms, regardless of their age. Each Director’s term will end at
the close of the General Meeting following his or her election
in compliance with article 19bis of the Articles of Association.
In 2015 our attitude will remain guarded, however. The recent
decision by the Swiss National Bank to abandon its euro/franc
floor rate and charge negative interest on deposits will have an
adverse impact on our revenues. We will have to remain
watchful and continue adapting to a fast-changing
environment.
The list of the members whom the Board of Directors will
propose for election/re-election will be included in the agenda
of the General Meeting to appear in the 1 April 2015 edition of
the FOSC.
Finally, we propose that for 2015 PricewaterhouseCoopers
SA be re-appointed as the Independent Auditors of the Bank
and the Group.
Bolstered by our family ownership, long-term vision and
healthy, rock-solid balance sheet, the Edmond de Rothschild
(Suisse) SA hub will be focused in the coming year on
satisfying the clients of both our private banking and asset
management divisions and on continuing to transform our
business model.
We cannot conclude this report without expressing our
gratitude to you, our shareholders, and to our clients for their
abiding trust.
The Board of Directors
90
Breakdown of revenues
(% of total)
54.2%
53.2%
32.1%
31.0%
2013
2014
9.8%
9.0%
5.6%
5.0%
Net interest income
Net fee and commission income
Trading income
Allocation of profit
(in millions of CHF)
118.5
101.6
98.5
81
78.8
69.8
69.2
56.3
56.3
56.25
50.65
Net profit
Dividend
33.9
29.4
28.6
30.3
Transfer to reserves
12.0
-5.1
-25.8
2009
2010
2011
2012
2013
2014
91
on the financial statements
As statutory auditor, we have audited the financial statements
of Edmond de Rothschild (Suisse) SA (previously Banque
Privée Edmond de Rothschild SA, Geneva), which comprise
the balance sheet, income statement, statement of cash flows
and notes (pp. 94-105), for the year ended 31 December
2014.
The Board of Directors is responsible for the preparation of the
financial statements in accordance with the requirements of
Swiss law and the company’s articles of incorporation. This
responsibility includes designing, implementing and
maintaining an internal control system relevant to the
preparation of financial statements that are free from material
misstatement, whether due to fraud or error. The Board of
Directors is further responsible for selecting and applying
appropriate accounting policies and making accounting
estimates that are reasonable in the circumstances.
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in
accordance with Swiss law and Swiss Auditing Standards.
Those standards require that we plan and perform the audit to
obtain reasonable assurance whether the financial statements
are free from material misstatement.
92
evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s
judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud
or error. In making those risk assessments, the auditor
considers the internal control system relevant to the entity’s
preparation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness
of the entity’s internal control system. An audit also includes
evaluating the appropriateness of the accounting policies
used and the reasonableness of accounting estimates made,
as well as evaluating the overall presentation of the financial
statements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for
our audit opinion.
Opinion
In our opinion, the financial statements for the year ended
31 December 2014 comply with Swiss law and the
company’s articles of incorporation.
Report on other legal requirements
We confirm that we meet the legal requirements on licensing
according to the Auditor Oversight Act (AOA) and
independence (article 728 CO and article 11 AOA) and that
there are no circumstances incompatible with our
independence.
In accordance with article 728a paragraph 1 item 3 CO and
Swiss Auditing Standard 890, we confirm that an internal
control system exists which has been designed for the
preparation of financial statements according to the
instructions of the Board of Directors.
We further confirm that the proposed appropriation of available
earnings (page 89) complies with Swiss law and the
company’s articles of incorporation. We recommend that the
financial statements submitted to you be approved.
Beresford Caloia
Audit Expert
Auditor in charge
Alain Lattafi
Audit Expert
93
Balance sheet
before profit appropriation at 31 December 2014
Notes
2014
2013
(in CHF ‘000)
(in CHF ‘000)
(in CHF ‘000)
Change
2,744,918
2,166,810
578,108
26.7
105,570
157,557
(51,987)
(33.0)
2,705,567
3,704,248
(998,681)
(27.0)
1,054,987
693,261
361,726
52.2
70,443
44,265
26,178
59.1
1,125,430
737,526
387,904
52.6
(in %)
Assets
Due from banks
1
Due from customers
Mortgage loans
Total advances to customers
2
2,929
2,733
196
7.2
3
613,959
614,088
(129)
(0.0)
Holdings
4
254,331
226,404
27,927
12.3
Fixed assets
5
154,184
157,131
(2,947)
(1.9)
30,969
19,524
11,445
58.6
Other assets
Total assets
6
198,233
109,907
88,326
80.4
7, 14
7,936,090
7,895,928
40,162
0.5
-
-
-
-
179,586
120,936
58,650
48.5
Subordinated amounts receivable
Amounts due from Group companies and qualifying shareholders
94
4, 11
Balance sheet
at 31 December 2014
Notes
2014
2013
(in CHF ‘000)
(in CHF ‘000)
Change
(in CHF ‘000)
(in %)
Liabilities
1,237
512
725
141.6
926,281
1,172,265
(245,984)
(21.0)
5,828,721
5,623,180
205,541
3.7
5,828,721
5,623,180
205,541
3.7
83,380
76,286
7,094
9.3
9
187,502
121,232
66,270
54.7
10
219,829
209,640
10,189
4.9
10
5,672
24,172
(18,500)
(76.5)
Share capital
11
-
Due to banks
8
Total due to customers
Other liabilities
45,000
45,000
-
General statutory reserve
119,385
119,385
-
-
Other reserves
445,851
449,069
(3,218)
(0.7)
41,945
40,112
1,833
4.6
4,006
4,537
(531)
(11.7)
of which: - treasury stock
Net profit brought forward
Net profit for the year
Total shareholders’ equity before profit appropriation
Total liabilities
69,226
50,650
18,576
36.7
11,12,13
689,140
692,813
(3,673)
(0.5)
14
7,936,090
7,895,928
40,162
0.5
-
-
-
-
911,326
1,183,919
(272,593)
(23.0)
Subordinated liabilities
Due to Group companies and qualifying shareholders
4, 11
Notes
2014
2013
(in CHF ‘000)
(in CHF ‘000)
Change
110,799
130,230
(19,431)
(14.9)
200,831
12,214
188,617
1'544.3
-
1,958
(1,958)
(100.0)
- positive replacement values
194,961
107,313
87,648
81.7
- negative replacement values
175,863
108,837
67,026
61.6
15,224,929
16,676,889
(1,451,960)
(8.7)
1,907,540
1,904,497
3,043
0.2
(in CHF ‘000)
(in %)
16
Derivative instruments:
- underlying values
Fiduciary transactions
17
95
for the year ended 31 December 2014
Notes
2014
2013
(in CHF ‘000)
(in CHF ‘000)
18,415
80
16,751
69
3,259
3,098
161
5.2
Interest payable
1,881
2,164
(283)
(13.1)
19,873
17,754
2,119
11.9
1,133
833
300
36.0
214,229
214,596
(367)
(0.2)
15,235
19,413
(4,178)
(21.5)
Commission income on securities and investment transactions
Commissions payable
Change
(in CHF ‘000)
1,664
11
(in %)
9.9
15.9
42,293
42,968
(675)
(1.6)
188,304
191,874
(3,570)
(1.9)
31,839
34,759
(2,920)
(8.4)
41
169
(128)
(75.7)
106,157
109,056
(2,899)
(2.7)
397
541
(144)
(26.6)
14,407
11,417
2,990
26.2
7,350
11,434
(4,084)
(35.7)
113,652
109,749
3,903
3.6
Operating income
353,668
354,136
(468)
(0.1)
Personnel expenses
180,670
193,782
(13,112)
(6.8)
70,206
68,321
1,885
2.8
Operating expenses
250,876
262,103
(11,227)
(4.3)
Gross profit
11.7
18
Income from holdings
Proceeds from real estate
102,792
92,033
10,759
26,116
26,656
(540)
(2.0)
24,039
41,742
(17,703)
(42.4)
52,637
23,635
29,002
122.7
19
22,582
32,786
(10,204)
(31.1)
19
274
-
274
-
5,719
5,771
(52)
(0.9)
69,226
50,650
18,576
36.7
Taxes
Net income for the reporting year
96
Overview of accounting policies
Accounting and valuation principles
The financial statements of Edmond de Rothschild (Suisse)
SA, have been prepared in accordance with the provisions of
the Swiss Code of Obligations, the Federal Law on Banks and
Savings Banks and its implementing ordinance (OB) as
revised on 1 February 1995, and the guidelines issued by
FINMA (the Swiss Financial Market Supervisory Authority). The
Bank’s separate financial statements provide as true a picture
as possible of its assets, financial situation and earnings.
Hidden (“latent”) reserves are included in the profit and loss
account under the headings “Depreciation of fixed assets”,
“Valuation adjustments, provisions and losses” and
“Extraordinary expenses”. Released hidden reserves are
included in “Extraordinary income”.
The financial statements of the parent company have been
drawn up in accordance with the accounting principles of the
Group, with the exception of the following items:
Description of the Bank’s operations
and staff size
Edmond de Rothschild (Suisse) SA is a bank specialising in
wealth management for private and institutional clients. It is a
member of the Swiss Exchange and became an accredited
dealer in transferable securities on 3 April 1998.
Converted to full-time jobs, the number of staff employed by
Edmond de Rothschild (Suisse) SA stood at 657 at end-2014
versus 648 a year earlier.
Holdings
This item comprises of interests in associated establishments
of either a long-term or infrastructural nature (regardless of the
percentage stake). These holdings are stated, at most, at their
acquisition value.
Fixed assets
This item includes Bank premises, other buildings, furniture,
machines and equipment, as well as intangible assets. Fixed
assets are evaluated at their acquisition cost, less the relevant
depreciation for each fixed asset category.
Risk management
The principles adopted by the Group regarding control of
market, credit, interest rate and country risks also apply to the
parent company.
Through its network of branches and subsidiaries in
Switzerland and abroad, the Bank conducts on its clients’
behalf all the operations customarily provided by private
banking institutions. Fee and commission business for the
account of clients mainly includes portfolio management,
fiduciary deposits and payment transactions, along with
trading in securities, precious metals and derivative
instruments.
The Bank also actively deals in debt instruments, equities,
currencies, precious metals and derivatives on a proprietary
basis, but does not engage in commodity trading.
The Bank does not outsource its services within the meaning
of FINMA circular 2008/7.
97
1
Due from banks
Due from banks
reverse repos
Total
2
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
(50.0)
162,305
324,838
2,543,262
3,379,410
(24.7)
2,705,567
3,704,248
(27.0)
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
2,276
2,131
6.8
2,276
2,131
Securities and precious metals portfolios held for trading purposes
Swiss shares and other securities:
- banks
- other
Foreign shares and other securities
Total
Treasury stock owned by Edmond de Rothschild (Suisse) SA, Geneva at
31 December
Total
-
-
-
653
602
8.5
2,929
2,733
7.2
2014
2013
Change
(nbre d'actions)
(nbre d'actions)
(in %)
149
149
-
Treasury stock transactions are reported at the market price on the trade date and are carried out as part of the Bank’s customary trading operations.
3
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
Federal Government
5,665
5,665
Cantons and municipalities
2,001
2,283
23,763
26,753
Swiss bonds:
Banks
Financial services companies
2,911
849
Insurance
3,284
3,284
Industrial enterprises
8,238
8,480
43,411
47,314
41,945
40,112
41,945
40,112
41,945
40,112
13,761
12,132
103,174
119,387
91,265
103,397
15.5
(65.7)
(8.2)
Swiss shares and other securities:
Banks
4.6
Foreign bonds:
Public corporations
Other
Precious metals
Units of investment trusts
Total
Treasury stock owned by Edmond de Rothschild (Suisse) SA, Geneva at
31 December
98
812
2,369
394,912
403,101
(2.0)
13,492
17,795
(24.2)
613,959
614,088
2014
2013
Change
(number of
shares)
(number of
shares)
(in %)
2,746
2,805
2.1
4
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
Banks
95,199
95,199
Financial companies
35,803
35,728
131,002
130,927
Banks
76,326
76,049
Financial companies
44,667
17,092
Holdings
Swiss shares and other securities
0,1
Real estate companies
Total
2,336
2,336
123,329
95,477
29,2
254,331
226,404
12,3
2014
2013
Share capital
Equity stake
Equity stake
(in millions of CHF)
Details of significant holdings Banks:
Banks:
Edmond de Rothschild (Lugano) SA, Lugano
CHF 5.0
100%
100%
Edmond de Rothschild (Bahamas) Ltd, Nassau
CHF 15.0
100%
100%
Edmond de Rothschild (Europe), Luxembourg
EUR 31.5
100%
100%
Edmond de Rothschild (Monaco), Monaco
EUR 12.0
34%
34%
Financial and asset management companies:
Edmond de Rothschild (UK) Limited, Londres
GBP 1.0
80%
80%
Privaco Family Office SA, Genève
CHF 2.1
100%
100%
Rouiller, Zurkinden & Cie Finance SA, Fribourg (merger by absorption by EdR (Suisse) SA)
CHF 0,6
0%
100%
Orox Asset Management SA, Genève
CHF 2.0
82%
40%
EUR 0.7
100%
100%
Real estate companies:
Copri III SA, Luxembourg
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
28,541
70,617
-
283
Amounts due to and from companies in which the Bank
has a majority interest (fully consolidated and non-consolidated
holdings for Group accounting purposes):
Due from banks
Due from customers
308
81
Other assets
69,957
8,592
Total assets
98,806
79,573
Due to banks
856,244
1,100,905
5,962
2,846
Accrued expenses and defferred income
1,554
410
28,850
68,162
892,610
1,172,323
Other liabilities
Total liabilities
24.2
(23.9)
99
5
Fire insurance value of fixed assets
Bank premises
Furniture, machines and equipment
6
Other assets
Positive replacement value of derivative instruments
Set-off account
Other
Total
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
133,262
131,731
1.2
92,891
92,693
0.2
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
194,961
107,313
81.7
-
8
(100.0)
3,272
2,586
26.5
198,233
109,907
80.4
2014
Book value
of assets
7
2013
Actual
encumbrance
Book value
of assets
Actual
encumbrance
Own liabilities subject to reservation of ownership
Securities pledged to a Stock Exchange to cover settlements
and as collateral for payment transactions
Assets pledged or assigned to cover own liabilities
Assets subject to reservation of ownership
Total assets pledged or assigned and subject to reservation
of ownership for own commitments
-‐
14,071
-‐
17,530
14,071
-
-
17,530
-
-
-
-
14,071
-
17,530
-
2014
2013
2,543,262
3,379,410
-‐
-‐
2,552,944
3,519,891
-
-
Securities lending and repurchase agreements
Claims arising from cash pledged as collateral under securities borrowing and reverse repo agreements
Liabilities arising from cash received as collateral under securities lending and repo agreements
Securities received as collateral under securities lending agreements and securities received under borrowing or
reverse repo agreements which the Bank has been authorised without restriction to sell or pledge subsequently
of which: - those of the above securities which were sold or pledged
The fees earned or paid as a result of securities lending are reported as per the duration of the loan and appear respectively as interest income or interest
charges. Repos and reverse repos are used to finance and refinance the purchase of special kinds of equities. They are stated as loans secured by financial
instruments or as deposits secured by shares from the Bank’s treasury stock. They are stated as advances secured by securities or as deposits for which
the Bank has pledged securities. The interest income arising from reverse repos and the interest charges arising from repos are reported as per the duration
of the relevant transactions.
100
8
Commitments to own pension plans
Total
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
58,508
50,128
16.7
Indications regarding personnel welfare plans can be found in Note 35 to the Consolidated Accounts.
9
Other liabilities
Set-off account
Negative replacement value of derivative instruments
Other
Total
Uses and
releases as
designated
Redesignations
11,632
(6)
Situation at end2013
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
175,863
108,837
61.6
23
99
(76.8)
11,616
12,296
(5.5)
187,502
121,232
54.7
Recoveries,
interests at risk
and currency
differences
New
provisions
charged to
profit and loss
account
Releases
reported in
profit and loss
account
Situation at
end-2014
-‐
43
72
(17)
11,724
-
-
-
-
(transfers)
10 Valuation adjustments and provisions
for default and other risks:
- valuation adjustments and provisions
for default risks (credit and country risks)
- valuation adjustments and provisions
for other operating risks
- other provisions
-
-
-
206,140
(9,101)
-‐
-
19,958
(668)
216,329
Subtotal
217,772
(9,107)
-‐
43
20,030
(685)
228,053
217,772
(9,107)
-
43
20,030
(685)
228,053
8,132
-
-
-
-
-
8,224
Total valuation adjustments
and provisions
Less valuation adjustments set off
directly against assets:
of which: - customers
Total valuation adjustments
provisions as per balance sheet
8,132
8,224
209,640
219,829
24,172
-
-
-
-
(18,500)
5,672
The foregoing valuation adjustments moreover include the instalment provided for in the tax settlement programme of the US Department of Justice, in line
with the recommendations of the Swiss Financial Market Supervisory Authority (FINMA).
Reserves for general banking risks are not taxed.
2014
Par value
2013
Number of Capital ranking
shares
for dividend
(in CHF ‘000)
Par value
(in CHF ‘000)
(in CHF ‘000)
Number of
shares
Capital ranking
for dividend
(in CHF ‘000)
11 Share capital
Fully paid registered shares at CHF 100.– par value
20,000
200,000
20,000
20,000
200,000
20,000
Fully paid bearer shares at CHF 500.– par value
25,000
50,000
25,000
25,000
50,000
25,000
Total share capital
45,000
45,000
See Notes 1 and 2 for treasury stock
.
101
(Note 11 cont’d)
Major shareholders
Edmond de Rothschild Holding SA 1)
Rothschild Holding AG. Zurich 2)
Par value
2014
Percentage
of capital
Percentage
of voting rights
Par value
2013
Percentage
of capital
Percentage
of voting rights
(in CHF ‘000)
(in %)
(in %)
(in CHF ‘000)
(in %)
(in %)
36,679.5
81.5
86.9
36,650.00
81.4
86.9
3,800.0
8.4
9.4
3,800.00
8.4
9.4
(1) The entire share capital of Edmond de Rothschild Holding SA is directly or
24) Christophe Desprez, Paris ; 25) Nicolas Bonnault, Paris ; 26) Laurent
indirectly controlled by members of the de Rothschild family. 17% of the
Baril, Paris ; 27) Philippe Le Bourgeois, Paris ; 28) Maria de Rothschild,
company’s share capital (representing 6.77% of voting rights) is owned by
Paris ; 29) Julia Footnick, Paris ; 30) Elisabeth Donovan, Paris ; 31) James
Baroness Edmond de Rothschild and 66.33% (representing 89.84% of
de Rothschild, Paris ; 32) Anna de Rothschild, Paris ; 33) Pierre de
voting rights) by Baron Benjamin de Rothschild. The financial statements of
Rothschild, Paris ; 34) Alexandra Pécoux, Paris ; 35) Emmanuelle Pécoux,
Edmond de Rothschild Holding SA are available on request in writing to the
Paris ; 36) Maylis Pécoux, Paris (together persons/entities 1), 3) and 13) to
company (PO Box 5254, 1211 Geneva 11).
36) represent the “PO-Group” and together entities and persons 1) to 12)
represent the RCSAS-Group); Rothschild Holding AG, Zurich owns 20,000
(2) Rothschild Holding AG, Zurich is owned by 1) Eric de Rothschild, Paris; 2)
registered shares and 3,600 bearer shares of
David de Rothschild, Paris; 3) Alexandre de Rothschild, Paris; 4)
(Suisse) SA, Geneva, representing 8.44% of the total share capital and
Stéphanie Lifford de Buffévent, Paris; 5) Louise de Rothschild, Paris; 6)
9.44% of voting rights.
Financière de Tournon SAS, Paris; 7) Financière de Reux SAS, Paris; 8)
Béro SCA, Paris; 9) Ponthieu Rabelais SAS, Paris; 10) Integritas BV,
RCSAS Group owns a controlling interest in Rothschild Concordia SAS, Paris.
Amsterdam; 11) Rothschild Trust (Schweiz) AG, Zurich; 12) AYRE
The PO Group controls Paris Orléans SCA, which in turn controls Concordia
Corporation (1972) Limited, Amsterdam; 13) Edouard de Rothschild, Paris;
Holding Sàrl, Paris. Concordia Holding Sàrl controls Rothschild Concordia AG,
14) Holding Financier Jean Goujon SAS Paris; 15) Rothschild Concordia
Zug, which in turn owns a controlling stake in Rothschilds Continuation
SAS, Paris; 16) Philippe de Nicolay, Paris; 17) Olivier Pécoux, Paris; 18)
Holdings AG, Zug. Rothschilds Continuation Holdings AG controls Rothschild
François Henrot, Paris; 19) Compagnie Financière Martin-Maurel SA,
Holding AG, Zurich, which owns a direct holding in Edmond de Rothschild
Marseille;
(Suisse) SA, Geneva.
20)
Eranda
Foundation,
UK;
21)
PO
Gestion
SAS, Paris; 22) PO Commandité SAS, Paris 23) CD GFA SARL, Paris ;
Number of
shares held
Cross holdings
Rothschild Holding AG. Zürich
10'161
2014
Per cent
stake in
share capital
Per cent
of total
voting rights
(in %)
(in %)
12.1
13.8
Number of
shares held
2013
Per cent
stake in
share capital
Per cent
of total
voting rights
(in %)
(in %)
12.0
11.6
10'161
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
80,454
41,139
Due to and from qualifying shareholders
Due to and from Edmond de Rothschild Holding SA, the only shareholder
with a qualifying interest in the parent company, and its owners:
Due from customers
Other assets
326
224
Total claims
80,780
41,363
16,647
11,596
Other liabilities
Total liabilities
102
-
-
18,716
11,596
95.3
61.4
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
45,000
45,000
-
119,385
119,385
12 Schedule of shareholders’ equity before appropriation of available earnings
Shareholders’ equity at beginning of the reporting period:
- share capital
- general statutory reserve
- other reserves
Reported profit
24,172
50,000
449,069
471,822
(51.7)
(4.8)
40,112
49,337
(18.7)
55,187
34,965
57.8
Total shareholders’ equity at beginning of the reporting period
(before appropriation of available earnings)
692,813
721,172
(3.9)
Allocated to / released from reserves
(16,649)
(22,759)
(26.8)
Less dividend deducted from net income of previous year
(56,250)
(56,250)
-
69,226
50,650
36.7
689,140
692,813
(0.5)
45,000
45,000
119,385
119,385
Net income
Total shareholders’ equity at end of the reporting period
(before appropriation of available earnings)
5,672
24,172
445,851
449,069
41,945
40,112
- reported profit
73,233
55,187
- other reserves
13 Shareholders’ equity after appropriation of available earnings
Shareholders’ equity before appropriation of net income
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
(0.5)
689,140
692,813
Less dividend
(56,250)
(56,250)
-
Total shareholders’ equity after appropriation of available earnings
632,890
636,563
(0.6)
- other reserves
- reported profit
14 Due to and from affiliated companies
Due from banks
Other assets
45,000
45,000
119,385
119,385
5,672
24,172
457,900
444,000
41,945
40,112
4,933
4,006
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
3,895
122,888
3,107
1,908
-
-
7,002
124,796
-
543
1,702
1,533
1,462
-
-
18
3,164
2,094
Total claims
Due to banks
Other liabilities
Total liabilities
(94.4)
51.1
Affiliated companies are companies in which Edmond de Rothschild Holding SA has a majority stake and that are not part of the Edmond de Rothschild
(Switzerland) Group.
103
All transactions with affiliated parties are carried out on the usual terms at the Bank in Switzerland and at our foreign subsidiaries.
104
2014
15
Ownership of shares in
Board of Directors
Chairman
Baronne Benjamin de Rothschild
Vice-Chairwoman
Jean Laurent-Bellue
Secretary
2013
Number of
bearer shares
Number of
registered shares
Number of
bearer shares
Number of
registered shares
443
5
445
7
101
-
101
-
-
-
1
1
-
1
-
1
67
-
67
1
-
1
-
1
10
1
10
1
Klaus Jenny
-
1
-
1
Maurice Monbaron
-
-
-
-
5
-
5
-
260
1
260
1
-
-
1
-
-
-
-
-
-
-
-
-
-
-
-
-
Luc J.Argand
François Hottinger
E.Trevor Salathé
(until 29.04.2014)
Veit de Maddalena
Executive Committee
Chairman & CEO
(since 01.05.2014)
(since 31.07.2014)
Emmanuel Fievet
Luca Venturini
Yves Aeschlimann
-
-
-
Sabine Rabald
(since 01.10.2014)
-
-
-
-
Cynthia Tobiano
(since 01.05.2014)
-
-
-
-
443
5
445
7
Total
Under the Ordinance on Excessive Remuneration in Listed Companies (OER), this year Edmond de Rothschild (Suisse) SA is for the first time publishing a Pay
Report (p. 107) containing details on the remuneration of its Board of Directors and Executive Committee.
105
16
Guarantees to third parties
Surety bonds
Guarantees
Total
17 Fiduciary transactions
Fiduciary deposits with banks outside the Group
Fiduciary deposits with Group banks
Fiduciary loans
Total
18 Results of trading operations
Securities trading (including equity product and index derivatives)
Forex trading (including forex derivatives)
Precious metals (including precious metals derivatives)
Total
19 Extraordinary income and expenses
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
3,766
3,987
(5.5)
107,033
126,243
(15.2)
110,799
130,230
(14.9)
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
1,868,283
1,813,646
3.0
39,257
90,851
(56.8)
-
-
-
1,907,540
1,904,497
0.2
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
3,382
2,305
46.7
28,106
31,592
(11.0)
351
862
(59.3)
31,839
34,759
(8.4)
2014
2013
Change
(in CHF ‘000)
(in CHF ‘000)
(in %)
22,582
32,786
(31.1)
274
-
-
“Extraordinary income” mainly contains dissolutions of CHF 18.5 million in 2014 and CHF 25.8 million in 2013 from the reserve for general banking risks, as
well as other provisions no longer required for operating purposes.
106
107
Pay Report
Introduction
108
Overview
Powers and procedure for setting
remuneration and profit-sharing
programmes
111
Voting on remuneration
109
112
Remuneration of the Directors
110
108
Remuneration of employees other
than members of the Executive
Committee
Remuneration for the reporting year
Remuneration of members
appointed after the General Meeting
Components of remuneration and
profit-sharing plan
Provisions of the Articles of
Association on loans, credit facilities
and company benefits granted to
members of the Board of Directors
and the Executive Committee
Loans to the Bank’s governing
bodies
Remuneration of members of the
governing bodies
Remuneration of the members of
the Executive Committee
Common rules applicable to the
remuneration of the governing
bodies
114
Report of the Auditor to the General
Meeting of Edmond de Rothschild
(Suisse) SA, Geneva
Introduction
As required by the Ordinance on Excessive Remuneration in
Listed Companies (OER) of 20 November 2013 and the
Swiss Code of Best Practice for Corporate Governance
published by economiesuisse, Edmond de Rothschild
(Suisse) SA has drawn up this Pay Report as part of the
Bank’s 2014 Annual Report.
This Pay Report contains the information prescribed by OER,
the Swiss Code of Obligations (CO) and section 5 of the SIX
Directive Relating to Information on Corporate Governance of
1 September 2014.
Pp. 112-113 of this Report are audited by the Bank’s Auditor,
PricewaterhouseCoopers SA, Geneva.
Overview
The remuneration policy of Edmond de Rothschild (Suisse) SA
fits in with the Group’s strategy and culture, as well as with the
nature of our activities. It also takes account of local factors
that are specific to each entity. Finally, it is designed to foster
loyalty among our employees and encourage them to
promote
our
long-term
success
by
espousing
entrepreneurship and risk control.
The remuneration policy of Edmond de Rothschild (Suisse) SA
draws on the guidelines set out in Circular 2010/1 –
“Remuneration Systems” issued by the Swiss Financial Market
Supervisory Authority (FINMA), while also complying with local
rules.
During the reporting year this policy was reviewed in light of
OER.
The Bank’s Articles of Association and Bylaws were adapted
to provide for new remuneration-setting powers.
The amended Articles of Association were approved at the
ordinary General Meeting of Edmond de Rothschild (Suisse)
SA on 29 April 2014.
They can be consulted in full on the Bank’s website:
www.edmond-de-rothschild.ch under the heading
/About Us/Investor Relations /General.
At the 2015 General Meeting, the Board of Directors of
Edmond de Rothschild (Suisse) SA will propose that the
Articles of Association be amended to comply with OER by
adding a new article (19quater) limiting the maximum number
of offices that the Directors may hold in other companies and
organisations. The Board will also propose an amendment to
the current wording of article 23bis limiting the maximum
number of offices that may be held by members of the
Executive Committee.
The proposed new wording of these two articles will appear in
the agenda of the General Meeting of Edmond de Rothschild
(Suisse) SA to be published in the FOSC on 1 April 2015.
Finally, this year for the first time the General Meeting will vote
separately on the overall remuneration of the Board of
Directors and the Executive Committee.
Powers and procedure for setting
remuneration and profit-sharing programmes
The rules on remuneration-setting powers, as revised in light
of OER, appear in the Bank’s Articles of Association and
Bylaws.
Prior to the 2014 revision of the Articles of Association, the
Pay and Promotions Committee was a single body. The Bank
now has two separate committees to oversee these areas.
The Pay Committee, set up in accordance with the OER
requirements, is empowered to do the following under art.
22bis para. 5 of the Articles of Association:
1. draw up Pay Regulations and submit them to the Board
of Directors for approval;
2. approve once a year the overall remuneration of the
Bank’s staff as proposed by the Executive Committee,
excluding the salaries and bonuses of the members of
the Executive Committee;
3. approve the remuneration of the persons in charge of
control functions identified by the Chair of the Executive
Committee (CEO);
4. after consulting with the CEO, make proposals to the
Board of Directors regarding the remuneration of the
members of the Executive Committee;
109
5. approve the remuneration of the Head of Internal
Auditing and his deputy as proposed by the Audit
Committee; and
6. make proposals to the Board of Directors regarding the
remuneration of the Directors for the tasks they perform
in this capacity and as members of the Board’s
committees.
The 2014 General Meeting elected five Directors to serve on
the Pay Committee for a one-year term. They are Baroness
Benjamin de Rothschild (Chair), Jean Laurent-Bellue
(Secretary), Luc J. Argand, Klaus Jenny and E. Trevor
Salathé. The Pay Committee meets at least twice a year. In
2014 it met twice.
Under art. 22 let. a of the Articles of Association, the Board of
Directors decides the overall remuneration of the Board of
Directors and the Executive Committee. These amounts are
then submitted to the General Meeting, which has the
unalienable right to approve them.
The Board of Directors is also responsible for drawing up the
Pay Report (under art. 22 let. k of the Articles of Association).
Voting on remuneration
Pursuant to art. 24quinquies of the Articles of Association, the
General Meeting each year votes on the overall amount
proposed by the Board of Directors in regard to the following:
− the overall pay package of the Board of Directors for the
period up to the next ordinary General Meeting;
− the overall pay package (excluding bonuses) of the
Executive Committee for the next financial year; and
− the bonuses paid for the reporting year.
The Board of Directors may submit proposals to the General
Meeting regarding remuneration in respect of other periods for
all the Directors, for all the members of the Executive
Committee or for only some of them.
The General Meeting’s votes on proposals regarding
remuneration are binding. Thus, should the General Meeting
decide not to approve a pay package proposed by the Board
of Directors, the Board will have to convene an extraordinary
General Meeting.
110
Remuneration of members appointed after
the General Meeting
If a member of the Executive Committee is appointed after the
General Meeting has approved the fixed remuneration of the
members of the Executive Committee, the remuneration
granted to him by the Board of Directors for the period up to
the next ordinary General Meeting may not exceed by more
than 40% the average remuneration of the other members of
the Executive Committee given final approval by the General
Meeting. The restriction is 50% for the Chair of the Executive
Committee. The average remuneration is calculated by
dividing the Executive Committee’s overall remuneration given
final approval by the General Meeting by the number of
members in office (art. 24quinquies para. 4 of the Articles of
Association).
Components of remuneration and profitsharing plan
Guidelines
An employee’s remuneration includes his annual contractual
fixed salary and a discretionary bonus, both paid in cash.
An employee’s remuneration is set according to his job,
qualifications, responsibilities and experience. It also takes
account of the prevailing conditions in the labour market, as
determined by surveys on remuneration in the banking and
wealth management sectors internationally.
A study is under way to implement a “long term” remuneration
system that will make it possible to align the interests of the
shareholders and key employees.
The remuneration of employees who perform control
functions, including the Head of Internal Auditing and those
who work in the Compliance, Legal, Control and Risk
Management departments, is mainly composed of a fixed
salary to avoid any conflicts of interest. The variable portion
does not depend directly on the results of the of the business
units that they oversee.
The Bank does not pay signing bonuses, although in certain
cases it does grant compensation for a loss of variable
remuneration resulting from the new employee’s job change.
Under the Bylaws, the remuneration system and any
objectives that have been assigned must not encourage
employees to disregard the Bank’s internal control
mechanisms and compliance rules.
Profit-sharing plans
The medium- and long-term remuneration plans of Edmond
de Rothschild (Europe) and its Belgian branch were
terminated at end-2014. As indicated above, a study is under
way to implement a new “long term” remuneration system
within the entire Edmond de Rothschild Group.
Remuneration of the Directors
The members of the Board of Directors receive a fixed annual
pay package that varies depending on whether they serve on
committees. The Directors are also entitled to a
reimbursement of their expenses, which do not form part of
their remuneration (under art. 24bis para. 1 of the Articles of
Association).
The remuneration of the Directors is decided by the Board of
Directors based on a proposal made by the Pay Committee.
The Board’s overall remuneration is then submitted to the
General Meeting for approval.
Remuneration of the members of the
Executive Committee
The remuneration of the members of the Executive Committee
comprises a fixed salary and a discretionary bonus. The
amount of the bonus depends on the Bank’s performance
and on the individual qualitative and quantitative performance
of each member. The Bank’s performance objectives are set
by the Board of Directors. The individual performance
objectives of the members of the Executive Committee,
excluding the Chair, are set by the CEO. The performance
objectives of the CEO are set by the Board of Directors.
A member of the Executive Committee is not entitled to a
bonus if the Bank terminates his employment contract for just
cause of if he terminates his own employment contract
without just cause.
The members of the Executive Committee are entitled to a
reimbursement of their expenses, which do not form part of
their remuneration.
The Board of Directors decides the remuneration of the
members of the Executive Committee, based on a proposal
by the Pay Committee. The overall amount is then submitted
to the General Meeting for approval (under art. 24bis para. 2
of the Articles of Association).
Any agreements that provide for the remuneration of members
of the Executive Committee and that are made between the
Bank or companies it controls, on the one hand, and
members of the Executive Committee, on the other, may not
be signed for a period exceeding one year. Nor may the
notice period for their termination exceed one year.
The Articles of Association as amended in 2014 contain a
transitory provision to the effect that employment contracts in
force at the new Articles’ effective date will have to be
adapted by 31 December 2015.
Common rules applicable to the
remuneration of the governing bodies
The remuneration of the members of the Board of Directors
and the Executive Committee is in principle paid in cash.
The members of the Board of Directors and the Executive
Committee do not receive shares, conversion rights, options
or other financial instruments as remuneration.
Within the limits provided by law, the work performed by
members of the Board of Directors and the Executive
Committee in companies controlled directly or indirectly by the
Bank may be remunerated. Any such sums are included in
the overall pay package submitted to the General Meeting for
approval (under art. 24quinquies of the Articles of
Association).
The members of the Executive Committee are covered by the
same pension plan as the Bank’s staff.
RAPPORT ANNUEL 2014 |
111
Provisions of the Articles of Association on
loans, credit facilities and company benefits
granted to members of the Board of Directors
and the Executive Committee
Even if a full year has elapsed, no bonus is due to an
employee whose employment contract has been terminated
by either party prior to the date on which bonuses are paid.
Nor is any bonus due for the current year if the employment
contract is terminated by either party.
Under art. 24quater of the Articles of Association, the Bank
may grant loans and other credit facilities to members of the
Board of Directors and the Executive Committee up to the
weighted collateral value of the pledged assets. In the case of
mortgage loans, the limit is 60% of the encumbered property’s
value. Loans and other credit facilities are granted in the form
of temporary current-account overdrafts, confirmed credit
lines and/or fixed-term advances, which may be secured or
unsecured. Mortgage loans are granted at variable or fixed
rates.
Moreover, an employee’s bonus is cancelled if his
employment contract is terminated on grounds of professional
misconduct or non-compliance with the values of the Edmond
de Rothschild Group. It is also cancelled if the employee
terminates his employment contract on his own initiative.
For all types of loans and other credit facilities granted to
Directors, the Bank receives interest and fees that are in line
with market conditions and with those charged to clients.
Members of the Executive Committee enjoy the preferential
interest rates granted to the Bank’s staff.
In addition to the occupational benefits approved each year by
the General Meeting, the members of the Board of Directors
and the Executive Committee may receive occupational
benefits paid by the Bank up to an amount corresponding to
20% of their last remuneration (excluding any bonus) as
approved by the General Meeting (under art. 24ter para. 3 of
the Articles of Association).
Remuneration of employees other than
members of the Executive Committee
Employees other than the members of the Executive
Committee receive an annual fixed salary and a discretionary
bonus.
The bonus is mainly based on the Bank’s results and on each
employee’s individual qualitative and quantitative performance.
If a discretionary bonus is granted, it is paid within 30 days
from the date of the Board meeting at which the Bank’s
annual financial statements are approved.
112
Remuneration for the reporting year
The table below discloses the remuneration and loans (as
defined in art. 14 et seq of OER) granted to the current and, if
applicable, past members of the Bank’s governing bodies. Up
to now this information appeared in note 15 of the Notes to
the Consolidated Financial Statements, in accordance with
art. 663bbis of the Code of Obligations.
The occupational benefits charges show only the portion paid
by the employer. The savings contributions are expressed as
a per cent of the salary (with a 15% cap) and take account of
the employee’s age. No supplementary benefits charges were
paid.
The fluctuations in remuneration between 2013 and 2014
were mainly due to the prorata temporis impact in the
reporting year of the CEO’s appointment on 1 May 2014 and
the allowance made for business development.
2014
1
2014
Loans granted
to the Bank’s
governing
bodies
Guarantee
commitments
on their behalf
Loans granted
to the Bank’s
governing
bodies
Guarantee
commitments
on their behalf
80,459
47
41,218
161
80,454
-
41,217
141
-
Loans to the Bank’s governing bodies
Guarantee commitments on behalf of
members of the Bank’s governing bodies
(in CHF ‘000)
Board of Directors
Chair
Vice-Chair
-
-
-
Jean Laurent-Bellue
Secretary
-
-
-
-
Luc J. Argand
5
18
1
18
-
-
-
-
François Hottinger
-
30
-
2
Klaus Jenny
-
-
-
-
Maurice Monbaron
-
-
-
-
-
-
-
-
E. Trevor Salathé
-
-
-
-
Executive Committee
-
4
21
71
-
4
-
-
-
28
-
54
Sabine Rabald
(since 01.10.2014)
Internal Auditors
Total
-
-
-
-
80,459
79
41,239
286
The loans disclosed above were granted in the form of temporary current-
At 31 December 2014, the rates applied to these mortgage loans ranged from
account overdrafts, confirmed credit lines and / or fixed-term advances,
0.7% to 2.5%. The interest rates on Lombard loans ranged from 1.5% to
either unsecured or secured by the pledge of the borrower’s assets
3.5% in the main currencies. No loans were granted to members of the
deposited with the Bank. Mortgage loans were granted at variable or fixed
Executive Committee. The overall face value of the loans granted to
rates.
members of the Board of Directors came to 80,459 (in CHF ‘000).
Mortgage interest is charged at usual market rates. Moreover, as in the case of
mortgage loans taken out by Bank employees with other financial institutions,
members of the governing bodies who are under an employment contract
with Edmond de Rothschild (Suisse) SA, Geneva receive a 25% rebate on
the mortgage rate up to a maximum amount of CHF 750,000.
113
2014
Fixed fees
Cash
2
Remuneration of members of the
governing bodiesaux members: (en
milliers de CHF) Board of Directors
Bonus
Number of
shares
Number of
shares
Cash
Other
Pension fund
charges
Total
841
-
121
-
-
-
962
Chair
-
-
-
-
-
-
-
Vice-Chair
-
-
-
-
-
-
-
-
-
-
-
-
-
Luc J. Argand
73
-
-
-
-
-
73
96
-
-
-
-
-
96
François Hottinger
62
-
-
-
-
-
62
136
-
-
-
-
-
136
Jean Laurent-Bellue
Secretary
Klaus Jenny
Maurice Monbaron
94
-
-
-
-
-
94
151
-
-
-
-
-
151
E. Trevor Salathé
229
-
121
-
-
-
350
-
-
-
-
-
-
-
3,999
-
3,465
-
459
3,554
11,477
600
-
1,910
-
67
-
2,577
4,840
-
3,586
-
459
3,554
12,439
Veit de Maddalena
(until 29.04.2014)
Executive Committee
Emmanuel Fievet
(since 01.05.2014)
Total
2014
Indemnités fixes
Nombre
d’actions
Espèce
Charges de
prévoyance
professionnelle
Indemnités variables
Nombre
d’actions
Espèce
Autres
Total
Board of Directors
1,020
-
123
-
-
-
1,143
Chair
-
-
-
-
-
-
-
Vice-Chair
-
-
-
-
-
-
-
Jean Laurent-Bellue
Secretary
133
-
-
-
-
-
133
Luc J. Argand
François Hottinger
Klaus Jenny
Maurice Monbaron
E. Trevor Salathé
68
-
-
-
-
-
68
112
-
-
-
-
-
112
62
-
-
-
-
-
62
131
-
-
-
-
-
131
47
-
-
-
-
-
47
151
-
-
-
-
-
151
224
-
123
-
-
-
347
Veit de Maddalena
(until 29.04.2014)
60
-
-
-
-
-
60
Claude Messulam
(until 11.06.2013)
32
-
-
-
-
-
32
5,466
-
9,159
-
692
492
15,809
2,200
-
3,183
-
101
-
5,484
6,486
-
9,282
-
692
492
16,952
Executive Committee
(until 29.04.2014)
Christophe de Backer
Total
Since individual members’ fees are not decided until after the close of the reporting year’s financial statements, the fees disclosed above are assessed on an
accrual basis.
“Other” remuneration represents compensation for any loss of variable pay resulting from a job change and/or severance pay granted in accordance with art.
28 of OER.
114
on the Pay Report
We have audited the Pay Report (pp. 112-113) of Edmond de
Rothschild (Suisse) SA (previously Banque Privée Edmond de
Rothschild SA, Geneva) for the year ended 31 December
2014.
The Board of Directors is responsible for the preparation and
fair presentation of the Pay Report in accordance with the Law
and Ordinance on Excessive Remuneration in Listed
Companies (OER). It is also responsible for setting guidelines
for remuneration and individual pay packages.
Our responsibility is to express an opinion on the Pay Report
based on our audit. We conducted our audit in accordance
with the Swiss Auditing Standards. These standards require
that we comply with ethics and that we plan and perform the
audit to obtain reasonable assurance that the Pay Report
abides by the law and articles 14-15 of the OER.
evidence about the statements in the Pay Report on the
remuneration, loans and other credit facilities indicated in
articles 14-16 of the OER. The procedures selected depend
on the auditor’s judgment, including the assessment of the
risks of material misstatement in the Pay Report, whether due
to fraud or error. This audit also includes evaluating the
appropriateness of the methods used to evaluate
remuneration as well as evaluating the overall presentation of
the Pay Report. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for
our audit opinion.
Nous estimons que les éléments probants recueillis sont
suffisants et appropriés pour fonder notre opinion d’audit.
Opinion
In our opinion, the Pay Report of Edmond de Rothschild for
the year ended 31 December 2014 complies with the law and
articles 14-16 of the OER.
Beresford Caloia
Audit Expert
Auditor in charge
Alain Lattafi
Audit Expert
115
Addresses
Edmond de Rothschild (Switzerland)
Head office
Branches
Subsidiaries
Geneva
Fribourg
Lugano
Edmond de Rothschild (Lugano) SA
(formerly
Banque Privée Edmond de Rothschild SA)
18, rue de Hesse
1204 Genève
T. +41 58 818 91 11
F. +41 58 818 91 21
Succursale de Fribourg
(formerly Banca Privata
Edmond de Rothschild Lugano SA)
Via Ginevra 2 - CP 5882
6901 Lugano
T. +41 91 913 45 00
F. +41 91 913 45 01
www.privata.edmond-de-rothschild.ch
(formerly
11, rue de Morat - CP 144
1701 Fribourg
T. +41 26 347 24 24
F. +41 26 347 24 20
Lausanne
Succursale de Lausanne
(formerly
2, avenue Agassiz
1003 Lausanne
T. +41 21 318 88 88
F. +41 21 323 29 22
116
Edmond de Rothschild (Switzerland)
Abroad
Branch
China
Hong Kong Branch
(formerly Banque Privée Edmond
de Rothschild SA- Hong Kong Branch)
Suite 5001, 50th floor, One Exchange Square
8 Connaught Place
Central – Hong Kong
T. +852 37 65 06 00
F. +852 28 77 21 85
www.edmond-de-rothschild.hk
Subsidiaries
Bahamas
Edmond de Rothschild (Bahamas) Ltd.
(formerly
Banque Privée Edmond de Rothschild Ltd.)
Lyford Financial Centre – Lyford Cay no. 2
Western Road
P.O. Box SP
63948 Nassau
T. +1 242 702 80 00
F. +1 242 702 80 08
www.edmond-de-rothschild.bs
Channel Islands
Edmond de Rothschild Securities (C.I.) Limited
(formerly
Edmond de Rothschild (C.I.) Limited)
Hirzel Court Suite D
St. Peter Port
Guernsey GY1 2NH
T. +44 1481 716 336
F. +44 1481 714 416
www.edmond-de-rothschild.gg
China
United Kingdom
Edmond de Rothschild Family Advisory
- Edmond de Rothschild (UK) Limited
(Hong Kong) Limited
(formerly
Privaco Family Office (HK) Limited)
Suite 5004, 50th floor, One Exchange Square
8 Connaught Place
Central - Hong Kong
T. +852 3125 16 00
F. +852 2869 16 18
- Edmond de Rothschild Asset Management
(UK) Limited
- Edmond de Rothschild Capital Holdings
Limited
- Edmond de Rothschild Private Merchant
Banking LLP
- Edmond de Rothschild Securities (UK)
Limited
Luxembourg
4, Carlton Gardens
(Details on next page)
T. +44 20 7845 5900
SW1Y 5AA London
F. +44 20 7845 5901
Monaco
Edmond de Rothschild (Monaco)
(formerly Banque de Gestion
Edmond de Rothschild Monaco)
Les Terrasses
2, avenue de Monte-Carlo - BP 317
98006 Monaco Cedex
T. +377 93 10 47 47
F. +377 93 25 75 57
www.edmond-de-rothschild.mc
Assurances et Conseils (Monaco)
Subsidiary of Edmond de Rothschild (Monaco)
(formerly Edmond de Rothschild
Conseil et Courtage d’Assurance - Monaco)
Les Terrasses - 2, avenue de Monte-Carlo
BP 317 - 98006 Monaco Cedex
T. +377 97 98 28 00
F. +377 97 98 28 01
www.edmond-de-rothschild.mc
Edmond de Rothschild Gestion (Monaco)
Subsidiary of Edmond de Rothschild (Monaco)
Les Terrasses - 2, avenue de Monte-Carlo
BP 317 - 98006 Monaco Cedex
T. +377 97 98 22 14
F. +377 97 98 22 18
New Zealand
www.edmond-de-rothschild.co.uk
Representative offices
United Arab Emirates
Edmond de Rothschild (Suisse) SA,
Banking Rep. Office Dubai
(formerly Banque Privée Edmond de Rothschild
SA Banking Rep. Office Dubai)
Sunset, office 46, 2nd floor
Jumeirah-3, Jumeirah Road
P.O. Box 214924
Dubai
T. +9714 346 53 88
F. +9714 346 53 89
Uruguay
Representación Uruguay
(formerly Representación
B.P. Edmond de Rothschild SA)
World Trade Center Montevideo
Torre II - Piso 21
Avenida Luis Alberto de Herrera 1248
11300 Montevideo
T. +598 2 623 24 00
F. +598 2 623 24 01
Privaco Trust Limited
Level 3, Parnell road 280
Parnell
Auckland 1052 – New Zealand
T. +64 93 07 39 50
F. +64 93 66 14 82
117
Edmond de Rothschild (Switzerland) Europe
Head office
Luxembourg
(formerly Banque Privée
Edmond de Rothschild Europe)
20, boulevard Emmanuel Servais
2535 Luxembourg
T. +352 24 88 1
F. +352 24 88 82 22
www.edmond-de-rothschild.eu
Subsidiaries
Luxembourg
Assurances et Conseils (Europe)
(formerly Adjutoris Conseil)
2535 Luxembourg
T. +352 26 26 23 92
F. +352 26 26 23 94
(Luxembourg)
(formerly
Edmond de Rothschild Investment Advisors)
2535 Luxembourg
T. +352 24 88 27 32
F. +352 24 88 84 02
www.edram.lu
Abroad
Branches
Representative office
Antwerp branch
Frankrijklei 103
2000 Antwerp
T. +32 3 212 21 11
F. +32 3 212 21 22
www.edmond-de-rothschild.be
Representative Office Israel
46, boulevard Rothschild
66883 Tel-Aviv
T. +972 356 69 818
F. +972 356 69 821
Joint venture
Japan
Nikko Cordial Co., Ltd
1-12-1, Yurakucho, Chiyoda-ku
Tokyo # 100-0006
Spain
T. +81 3 3283-3535
Madrid main branch
Sucursal en España
Paseo de la Castellana 55
28046 Madrid
T. +34 91 364 66 00
F. +34 91 364 66 63
www.edmond-de-rothschild.es
F. +81 3 3283-1611
Barcelona branch
Sucursal en España
Josep Bertrand 11
08021 Barcelona
T. +34 93 362 30 00
F. +34 93 362 30 50
www.edmond-de-rothschild.es
Portugal
Brussels main branch
Succursale en Belgique
Avenue Louise 480 - Bte 16A
1050 Brussels
T. +32 2 645 57 57
F. +32 2 645 57 20
Sucursal em Portugal
Edmond de Rothschild (Europe),
www.bpere.edmond-de-rothschild.co.il
Liège branch
Quai de Rome 56
4000 Liège
T. +32 4 234 95 95
F. +32 4 234 95 75
Belgium
118
Israel
Rua D. Pedro V, 130
1250-095 Lisbon
T. +351 21 045 46 60
F. +351 21 045 46 87/88
www.edmond-de-rothschild.pt
Other Edmond de Rothschild Group companies
La Compagnie Financière Edmond de Rothschild
Head office
Nantes
Edmond de Rothschild Private Equity
Edmond de Rothschild (France)
(France)
France
11, rue Lafayette
47, rue du Faubourg Saint-Honoré
44000 Nantes
75401 Paris Cedex 08
(formerly La Compagnie Financière
Edmond de Rothschild Banque)
T. +33 1 40 17 25 25
F. +33 1 40 17 24 02
www.edmond-de-rothschild.fr
T. +33 2 53 59 10 00
T. +33 1 40 17 25 25
F. +33 2 53 59 10 09
F. +33 1 40 17 23 91
Strasbourg
Edmond de Rothschild Investment Partners
6, avenue de la Marseillaise
67000 Strasbourg
T. +33 1 40 17 25 25
T. +33 3 68 33 90 00
F. +33 1 40 17 31 43
F. +33 3 88 35 64 86
www.edrip.fr
Bordeaux
Hôtel de Saige
23, cours du Chapeau Rouge
33000 Bordeaux
T. +33 5 56 44 20 66
F. +33 5 56 51 66 03
Lille
116, rue de Jemmapes
59800 Lille
T. +33 3 62 53 75 00
F. +33 3 28 04 96 20
Lyon
27, rue Auguste Comte
69002 Lyon
T. +33 4 72 82 35 25
F. +33 4 78 93 59 56
Marseille
165, avenue du Prado
13272 Marseille
Toulouse
Assurances et Conseils (France)
(formerly
Assurances Saint-Honoré Patrimoine)
T. +33 1 40 17 22 32
F. +33 1 40 17 89 40
www.edrac.fr
22, rue Croix Baragnon
31000 Toulouse
T. +33 5 67 20 49 00
F. +33 5 61 73 49 04
Subsidiaries and subsubsidiaries
Paris
(France)
T. +33 1 40 17 25 25
F. +33 1 40 17 24 42
www.edram.fr
Edmond de Rothschild Corporate Finance
T. +33 1 40 17 21 11
F. +33 1 40 17 25 01
www.edrcf.com
T. +33 4 91 29 90 80
F. +33 4 91 29 90 85
119
Abroad
China
Israel
Edmond de Rothschild (Israel) Ltd.
(Hong Kong) Ltd.
(formerly Edmond de Rothschild Investment
Services Ltd.)
20, Rothschild Boulevard
66883 Tel Aviv
T. +972 3 713 03 00
F. +972 3 566 66 89
www.edris.co.il
Suite 5003 – 50F, One Exchange Square
China
8 Connaught Place
Central - Hong Kong
Shanghai Representative Office
T. +852 3926 5288
Edmond de Rothschild Banque)
Room 3, 28F China Insurance Building
166 East Lujiazui Road, Pudong New Area
200120 Shanghai
T. +86-21 60 86 25 99
F. +86-21 60 86 25 40
F. +852 3926 5008
Subsidiaries, subsubsidiaries
and branches
Germany
(France), Niederlassung Deutschland
Asset Management Deutschland)
OpernTurm
2-8 Bockenheimer Landstrasse
60306 Frankfurt am Main
T. +49 69 244 330 200
F. +49 69 244 330 215
www.edram.de
Chile
(Chile)
Apoquindo 4001 oficina 305
Las Condes
Santiago
T. +56 2598 99 00
F. +56 2598 99 01
www.edram.fr
www.edram.fr
Edmond de Rothschild Securities
(Hong Kong) Ltd.
Asia Securities Limited)
8 Connaught Place
Central - Hong Kong
T. +852 3926 5288
F. +852 3926 5008
(Hong Kong) Ltd.
Asia Private Investors Limited)
8 Connaught Place
Central - Hong Kong
T. +852 3926 5288
F. +852 3926 5008
(Shanghai) Ltd.
China Limited)
Room 02, 28F China Insurance Building
166 East Lujiazui Road,
Pudong New Area
Shanghai 200120
T. +86 21 6086 2503
F. +86 21 6086 2550
Spain
(France), Sucursal en España
Paseo de la Castellana 55
28046 Madrid
T. +34 91 789 32 20
F. +34 91 789 32 29
www.edram.fr
120
Italy
Succursale italiana
Edmond de Rothschild Banque Succursale italiana)
Palazzo Chiesa
Corso Venezia 36
20121 Milan
T. +39 02 76 061 200
F. +39 02 76 061 222
Edmond de Rothschild (Italia) S.G.R. SpA
Palazzo Chiesa
Corso Venezia 36
20121 Milan
T. +39 02 76 061 200
F. +39 02 76 061 222
Other Edmond de Rothschild Group companies
Asset Management (Suisse) SA
Compagnie Benjamin de Rothschild
Conseil SA
Switzerland
Switzerland
Edmond de Rothschild Asset Management (Suisse) SA
Compagnie Benjamin de Rothschild Conseil SA
(formerly La Compagnie Benjamin de Rothschild SA)
8, rue de l’Arquebuse
CP 5441
1211 Genève 11
T. +41 58 201 75 00
F. +41 58 201 75 09
29, route de Pré-Bois
CP 490
1215 Genève 15
T. +41 22 761 46 40
F. +41 22 761 46 59
www.cbrc.ch
Orox Asset Management
Private Equity S.A.
Switzerland
Orox Asset Management
16, rue de Hesse
Luxembourg
1204 Genève
Edmond de Rothschild Private Equity S.A.
T. +41 22 436 32 40
(formerly CBR Holding (Luxembourg) S.A.)
21, rue Léon Laval
L-3372 Leudelange
T. +352 26 74 22-1
F. +352 26 74 22 99
www.orox.ch
COGIFRANCE
France
Compagnie Benjamin de Rothschild
Management (Luxembourg) S.A.
COGIFRANCE
63, rue La Boétie
75008 Paris
T. +33 1 45 61 65 00
Luxembourg
F. +33 1 40 70 08 44
Compagnie Benjamin de Rothschild Management (Luxembourg)
S.A.
(formerly General Partner Participations S.A.)
21, rue Léon Laval
3372 Leudelange
T. +352 26 74 22-1
F. +352 26 74 22 99
121

20142014 - Hong Kong Monetary Authority

Transcription

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