Glarus, April 21, 2022 – The Glarner Kantonalbank (GLKB) generated a good operating result in the first quarter of 2022. Mortgage claims increase by 100 million francs and customer deposits increase by 242 million francs. Operating income increased by 9.0 percent to 22.8 million francs, while total assets exceeded the 8 billion mark with growth of 566 million francs.
Good operating result
Net interest income increased by 16.0 percent to CHF 18.9 million. Among other things, lower refinancing costs are one of the reasons why interest expenses fell again significantly compared to the same period of the previous year to CHF 0.3 million. Thanks to the good development, it is also possible to release individual value adjustment items in the first quarter. Commission income increased by 17.1 percent to CHF 4.1 million. This is due to the strong securities and investment business and the continuous expansion of client business in the “bitubi” area. Income from trading fell slightly to CHF 0.9 million, while unrealized valuation losses on financial investments led to a more significant decline in other ordinary income. The significant rise in interest rates in the first quarter also led to lower prices for bonds from the best borrowers. Operating income increased by a total of 9.0 percent to CHF 22.8 million.
Investments in innovation
Personnel expenses reflect the job growth completed over the past two years and rose by 18.0 percent to CHF 9.3 million. Material expenses increased by 23.7 percent to CHF 6.0 million. In particular, ongoing investments in new products and IT security have an impact here. The maximum amount of CHF 0.75 million is set aside to cover the state guarantee. Overall, business expenses increased by 20.1 percent to CHF 15.3 million.
Focus on cost development
Business success fell by 13.4 percent to CHF 6.2 million. The net profit comes in at 5.6 million Swiss francs. Depreciation of property, plant and equipment will increase to CHF 1.2 million and CHF 0.6 million will be made available for taxes. The Bank will increasingly focus on cost developments.
Mortgages and customer deposits are increasing
The core mortgage business continues to develop very well with growth of CHF 100 million. GLKB passed on a further CHF 12 million in mortgage volume to its “bitubi” customers without affecting their balance sheets. Customer deposits increase by 242 million francs. Due to the higher interest rates, medium-term notes are also growing for the first time in a long time. The balance sheet total increases by 566 million francs. At CHF 8.327 billion, it surpassed the 8 billion mark for the first time.
Template for the new participation strategy of the canton of Glarus
At the Landsgemeinde on May 1, 2022, the electorate will decide on the canton’s new investment strategy in the Glarner Kantonalbank. GLKB welcomes the intention of the Glarner government and the district administrator to abolish the state guarantee, to reduce the canton’s shareholding in the medium term and to convert the bank into a private limited company. The change to the proposed investment strategy grants GLKB the necessary entrepreneurial freedom of action, while the effective control and monitoring mechanisms of the owners remain in force. Irrespective of the Landsgemeinde decision, the Glarner Kantonalbank is and will remain the bank of the people of Glarus.