A roundup of first-quarter, 2018 financial results from the private banking, wealth management industry.

 Here is a summary of results for the first quarter of 2018 among banks and various wealth management firms around the world.

Note: These results may be subject to revision. Not all banks report results in the same way or frequency.

Goldman Sachs
It reported net revenues in investment management of $1.77 billion for the first quarter of 2018, 18 per cent higher than the first quarter of 2017 and 6 per cent higher than the fourth quarter of 2017. The increase in net revenues compared with the first quarter of 2017 was due to higher management and other fees, primarily reflecting higher average assets under supervision, as well as higher incentive fees and higher transaction revenues.

During the quarter, total assets under supervision increased $4 billion to $1.50 trillion. Long-term assets under supervision increased $9 billion, due to net inflows of $13 billion, reflecting inflows in fixed income and equity assets, partially offset by net market depreciation of $4 billion, primarily in equity assets. Liquidity products decreased $5 billion.

Bank of America Merrill Lynch
The group reported that its global wealth and investment management arm made a pre-tax profit of $1.4 billion, up 12 per cent in the first three months of this year from a year ago. Revenues at GWIM reached a record of $4.9 billion in Q1, a 6 per cent year-on-year gain, it said in a statement yesterday. The operation’s pre-tax margin was 29 per cent, up from 27 per cent year, aided by robust growth and costs management. Assets under management inflows stood at $24 billion, the third-highest on record, boosted by higher client activity and a shift from IRA brokerage accounts to managed relationships. 
Referrals to and from GWIM with other areas of the company increased by around 10 per cent on the previous quarter and 11 per cent from a year ago. The total number of wealth advisors grew 4 per cent to reach 19,276 at the end of the quarter compared to 18,538 in 1Q 2017 (includes Merrill Lynch, US Trust and Merrill Edge advisors).

Within Merrill Lynch Wealth Management, there was record quarterly revenue of $4 billion, a 5.6 per cent gain on a year ago, driven by higher asset management fees and net interest income. Client balances of $2.3 trillion rose 5 per cent on the year. Merrill Lynch Advisors’ financial advisor productivity came in at $1.36 million per experienced advisor, a rise of 3.6 per cent from the previous quarter and up 5.7 per cent on the year. Total advisor productivity increased by nearly 4.5 per cent on the quarter and year. Merrill Lynch achieved year-on-year advisor growth of 272 (or 2 per cent) for a total of 14,829 at the end of the quarter. US Trust logged revenue of $860 million, a rise of 6.5 per cent on the first quarter of last year.

Morgan Stanley
The wealth management arm of Morgan Stanley has reported first-quarter 2018 net revenues of $4.374 billion, a gain from $4.058 billion a year ago, while pre-tax income rose to $1.16 billion from $973 billion. This part of the US-headquartered group reported fee-based asset flows of $18.2 billion in Q1. Net interest income of $1.1 billion increased from $994 million a year ago driven by higher interest rates and growth in bank lending. Wealth management client liabilities were $80 billion at quarter end compared with $74 billion in the prior year quarter. A total of 15,682 wealth management representatives at Morgan Stanley produced average annualized revenue per representative of $1.1 million in the current quarter.

Citigroup
Revenues at the private banking arm rose 21 per cent year-on-year to stand at $904 million in the first three months of this year. The revenue increase was driven by growth in clients, loans, investments and deposits as well as by improved spreads on deposits. The Q1 revenue figure also rose on the quarter, up from $776 million from the last three months of 2017.

Wells Fargo
Wells Fargo’s wealth and investment management arm, which includes units such as its Abbot Downing group, reported net income of $714 million in the first three months of this year, rising 6 per cent from the fourth quarter of last year 2017 and up from $665 million a year ago. WIM revenue of $4.2 billion decreased $91 million, or 2 per cent, from the prior quarter, primarily due to lower gains on deferred compensation plan investments (offset in employee benefits expense), lower net interest income, and lower transaction revenue, partially offset by higher asset-based fees. Noninterest expense increased $44 million, or 1 per cent, from the prior quarter, primarily driven by seasonally higher personnel expenses, partially offset by lower non-personnel expense and lower deferred compensation plan expense (offset in gains on equity securities). WIM total client assets were $1.9 trillion, up 4 per cent from a year ago, driven by higher market valuations. Within wealth management, client assets were $242 billion, up 2 per cent from the prior year.

BNY Mellon
The firm logged total wealth management revenues of $318 million in the first quarter of this year, up 5 per cent from the same quarter a year ago. Asset management revenues stood at $770 million in Q1, a 16 per cent year-on-year gain. 

Assets under custody and/or administration of reached a record $33.5 trillion, up 9 per cent, reflecting higher market values, the favourable impact of a weaker dollar and net new business. Assets under management stood at $1.9 trillion, up by 8 per cent, buoyed by a weaker dollar (principally versus the British pound), higher market values and net inflows, partially offset by the divestiture of CenterSquare Investment Management and other changes.

Northern Trust
The Chicago-headquartered financial group serving businesses such as wealth managers with custody and related offerings, said wealth management AuM rose 10 per cent year-on-year to $287.4 billion as at March 31 this year, but dropped 1 per cent on the previous three-month period. Northern Trust said wealth management assets under custody rose 12 per cent year-on-year to $645.2 billion in the latest quarter.

UBS
Its global wealth management business – which now includes all wealth operations under one roof – logged adjusted profit before tax of SFr1.126 billion ($1.154 billion), a 7 per cent year-on-year rise and up 14 per cent when measured in dollars. The profit figure contained new records in the Americas and the Asia-Pacific region. Meanwhile, personal and corporate banking logged adjusted profit before tax of SFr393m; transaction-based income and recurring net fee income increases, and net new business volume showed strong growth UBS said. Asset management had net new money of SFr27billion excluding money markets, taking invested assets to SFr792 billion, the highest in a decade. Total invested assets at the end of March were Sr3.155 trillion, versus SFr2.922 trillion a year earlier.

These were the first results to be issued by the Swiss bank since it announced in January it was unifying its wealth management businesses into one division. Previously, its international and Americas businesses had reported separate figures.

Credit Suisse
The group reported a broadly strong set of figures for the first quarter of this year, logging pre-tax income of SFr1.1 billion ($1.12 billion), a gain of 57 per cent on a year ago, while adjusted pre-tax income gained 36 per cent, at SFr1.2 billion.

Across all its wealth management arms, Switzerland’s second-largest bank generated SFr1.3 billion of adjusted pre-tax income, a rise of 61 per cent – around SFr500 million – over the past three years. More than half of the improved additional pre-tax income was generated in the first quarter alone, showing that progress is accelerating.

The Swiss Universal Bank made adjusted pre-tax income of SFr554 million, up 15 per cent year on year. Net revenues rose 3 per cent year on year on an adjusted basis, driven by increased transaction-based revenues and recurring commissions and fees. In the private clients segment of the Swiss business, net new assets reached SFr2.7 billion, the highest quarterly level to date.

Within Credit Suisse’s international wealth management, segment, adjusted pre-tax income rose by 45 per cent year-on-year to SFr474 million. Double-digit growth in net revenues reflected broad-based contributions across most businesses. Total operating costs held steady; adjusted return on regulatory capital increased 9 percentage points to 35 per cent in the first quarter. Private banking delivered an adjusted pre-tax income of SFr382 million, up 46 per cent on a year earlier. Net new assets stood at SFr5.5 billion at an annualised growth rate of 6 per cent, with strong inflows in emerging markets and Europe.

Vontobel
The Swiss wealth management house achieved a record SFr189.4 billion ($195.6 billion) at the end of March, rising from SFr186.6 billion at the end of 2017), and up 18 per cent year on year. Its dividend pay-out rose to a total of SFr2.10 per share. Shareholders approved the board of directors’ proposal to increase the ordinary dividend per share by a total of 11 per cent or SFr0.20 to SFr2.10. This corresponds to a pay-out ratio of 58 per cent.

Deutsche Bank 
The lender’s private and commercial unit saw revenues slip 2 per cent in the first quarter to €2.6 billion ($3.2 billion). The income figure at the private banking unit, which encompasses wealth management, was “largely attributable” to specific one-time gains in the first quarter of 2017 outsizing the net positive of equivalent items in Q1 2018 by around €80 million,

Commerzbank
The private and small business customers segment logged a rise in Q1 revenues to €1.237 billion (Q1 2017: €1.168 billion). Excluding non-recurring items they improved by €44 million due to the good loan growth, more than offsetting the impact of negative interest rates. Operating profit rose year-on-year to €202 million (Q1 2017: €194 million). The bank gained approximately 73,000 net new private and small business customers in Germany in the first quarter, meaning customer growth was higher than in the previous two quarters. The PSBC segment has gained a net 712,000 new customers in Germany since October 2016. Assets under control showed large gains in loans (€3 billion), deposits (€3 billion) and net new inflows in securities accounts (€3 billion).

Societe Generale
The bank said Q1 revenues of its wealth and asset management business group fell 3.6 per cent year-on-year at €243 million ($290.8 million). Private banking’s assets under management amounted to €117 billion at end-March 2018, down 0.5 per cent from the end of last year. SocGen said that despite healthy transactional activity and robust inflow in France, private banking revenues were hit by a drop in international activities. Net banking income was down by 7.5 per cent in this segment, at €185 million. Assets under management at SocGen’s Lyxor asset management business roe 4.2 per cent from the end of 2017, at €117 billion.

BNP Paribas 
Assets under management at its insurance, wealth and asset management arm reached €1.051 trillion ($1.26 trillion) at 31 March, a 0.9 per cent rise from a year ago, and held steady from the end of last year. Within the wealth management arm, the Paris-listed group held €362 billion of assets. The group said its wealth and asset management’s revenues (€795 million) rose by 2.8 per cent compared to the first quarter of last year.

HSBC
The private banking arm today reported net operating revenue of $482 million in the first quarter of this year, a 10 per cent year-on-year rise. Adjusted pre-tax profit at its private bank surged 53 per cent to $113 million in Q1, driven by revenue growth, with some offsetting effect from a marginal rise in operating costs during the period. During the quarter the private bank brought in $5.3 billion of net new money.

Coutts; Adam & Co 
The private banking arms of Royal Bank of Scotland said operating profits rose to £62 million ($85 million) in the first quarter, up £29 million from last year. Total income rose 9.4 per cent to £184 million from the same period of last year, “reflecting increased lending and assets under management,” they said, adding that AuM jumped 14 per cent, or £2.5 billion. Return on equity increased to 12.5 per cent, while the group’s cost/income ratio, expressed as a percentage, fell to 65.8 per cent, “driven by strong asset and AuM growth”. Operating expenses were cut by 4.7 per cent, or £6 million, “reflecting lower strategic costs and an 11.8 per cent reduction in headcount”. The firms gave out an extra £1.2 billion of net loans and advances, 10 per cent higher year-on-year, totalling £13.7 billion.

Barclays
Group loss before tax was £236 million, contrasting with a year-ago profit of £1.682 billion. Excluding litigation and conduct, profit before tax increased 1 per cent to £1.725 billion driven by a 45 per cent improvement in credit impairment charges, primarily reflecting single name recoveries in wholesale and the improved macroeconomic forecasts in the US, and a 6 per cent cut in operating expenses, partially offset by an 8 per cent decline in income. 

Barclays doesn’t break out its wealth and investment management results.

Standard Chartered
Standard Chartered’s private banking arm logged a 23 per cent year-on-year rise in income for the first three months of this year, outperforming the gains made by the group as a whole. The UK-listed bank logged $144 million in Q1 for private banking, against $130 million in the previous quarter and $117 million a year earlier,

DBS
Net profit in the first quarter of this year surged 26 per cent year-on-year to S$1.52 billion ($1.14 billion), while its consumer banking/banking wealth management income rose 17 per cent to S$1.36 billion. The banking group said its total income for Q1 stood at $3.36 billion, a gain of 16 per cent on the same period a year ago. The results saw DBS’ cost-income ratio tighten to 42 per cent, DBS said in a statement. Return on equity was 13 per cent, the highest in a decade.

OCBC
Oversea-Chinese Banking Corp’s said its wealth management business – which includes Bank of Singapore – logged a 22 per cent rise, year on year, in first-quarter income to S$727 million ($544 million). Bank of Singapore’s assets under management increased 19 per cent in Q1 to $102 billion (S$133 billion) as at 31 March 2018, from $85 billion (S$119 billion) of the previous year (AuM figures are reported in US dollars). As a proportion of the group’s total income, wealth management income which included income from insurance operations, contributed 31 per cent, up from 28 per cent a year ago.