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Annual review 2006
The private bank of Cantonal Bank of St.Gallen
HYPOSWISS Private Bank Ltd. Bahnhofstrasse/Schützengasse 4 | CH-8023 Zurich | Phone +41 (0)44 214 31 11 | Telefax +41 (0)44 211 52 23 | www.hyposwiss.ch
HYPOSWISS Private Bank Ltd. Bahnhofstrasse /Schützengasse 4CH-8023 ZurichPhone +41 (0)44 214 31 11Telefax +41 (0)44 211 52 23
www.hyposwiss.ch
Contents
Editorial 3
Annual review 4
Organs of the bank 5
Organisation 7
Key Data 2006 9
Financial section Summary 11
About the balance sheet 12
About the income statement 14
Personnel 16
Income Statement 2006 17
Balance sheet at 31 December 2006 18
Appropriation of disposable profi t 21
Cashfl ow account 22
Auditors’ report 23
SecurityFaced with the problem of increasing your assets while at the
same time minimising risk? Never tackle tricky passages alone;
always think of your safety – both elementary rules of moun-
taineering. As they are of private banking.
Dear Customer,
Dear Sir,
Dear Madam,
HYPOSWISS can look back on 2006 as a very successful fi nancial
year. All the key datas were up, some of them markedly. Our
operating income rose to CHF 112.6 m (+18 %) and net profi t to
CHF 47.5 m, representing an increase of 68 %. Customer assets
also rose very satisfactorily to a new high of CHF 12.4 billion
(+3.6 billion). These fi gures are on the one hand an expression
of the high regard in which our customers hold HYPOSWISS;
on the other hand, an excellent year on the stock markets with
some record-breaking index levels also had a positive effect on
business growth.
Our investment policy is designed to achieve above-average
yields for our customers. Particular attention should be drawn
to HYPOSWISS’s own funds, which registered excellent value-
growth over the past year, as well as to the gratifying perform-
ance of our asset-management mandates.
Among the most important events of the past year have been
the introduction of a new, modern IT platform and the expan-
sion of our Investment Centre. The dynamic growth of
HYPOSWISS also fi nds expression in the personnel sphere, our
staff having increased by 12 employee units to a new level of
146 persons.
On 1 April 2006 Hansjörg Enderli, a member of the Executive
Board and Head of Service and Logistics, retired from
HYPOSWISS after working for the bank for 32 years. Stefan
Betschart was appointed to succeed him. On 1 October 2006
Hansjürg Christen joined us as Head of Business Management,
fi lling another key post for our projected expansion at home
and abroad. On 1 December 2006 Dr Thomas Stucki entered the
employment of our bank as Chief Investment Offi cer and
member of the Executive Board. Dr Stucki is responsible for
investment policy and manages the Investment Centre.
As part of the traditional HYPOSWISS «Art in the Bank» pro-
gramme, three private views of exhibitions were held. Large
numbers of visitors accepted the invitations of Heidi Thöny,
Elisabeth Heller, Yvonne, Aline, and Fritz J. Dold and drew
inspiration from the art objects on display.
The corporate culture of HYPOSWISS is founded on our aspira-
tion (which is something that we take for granted) to achieve a
sustainable increase in value for our customers, to offer them
personal, discreet service – in fact, to place customer service at
the heart of everything we do.
So we can look forward to the future with a hefty dose of
optimism. In addition, the economic climate remains positive.
The prospects are excellent that HYPOSWISS will be able to
pursue the growth curve that the bank is currently enjoying.
I thank you most warmly for the trust you continue to place in
our institution.
Your
Marcel W. Schmid
Chief Executive Offi cer
Editorial
HYPOSWISS Annual review 2006 3
Annual review
The Executive Board (l. to r.):Stefan Betschart, Dr Thomas Stucki, Marcel W. Schmid (CEO), Martin Forster, Anton Schaad, Urs Eggenberger
As an investment year, 2006 was characterised by favourable
developments on stock markets. With the exception of Japan,
the major stock markets were able to build on the previous
year’s excellent performance - in spite of a clear course correc-
tion in spring 2006. Much of this had to do with persistently
high corporate profi ts and overwhelmingly positive economic
news.
On the interest side, rate increases by the central banks lead
to losses at the short end of the term spectrum. On the other
hand, interest rates in the medium-term and long-term seg-
ments changed only little on balance, which led to an increas-
ing levelling-out of interest curves in the principal countries.
In the USA the structure of the interest curve even took an
inverse turn.
On the foreign-exchange markets, the value of the euro in-
creased sharply against the other major currencies, the US
dollar and the yen, but also against the Swiss franc. The dimin-
ishing interest-rate gap between Europe and the USA was one
important factor in this development.
In 2006 all funds managed by the group’s own Investment
Centre turned in an above-average performance. The Danube
Tiger Fund, investing not only in shares but also in bonds from
central and eastern European countries, and the share funds
of Euroland, Switzerland, and the USA all increased by more
than 20 % each in the year under review. In the context of an
internationally favourable share environment, prudent selection
of securities by fund managers paid off. Compared with the
equivalent competitor products, the said funds were to be found
in the front rank in the year just ended.
In 2006 the Investment Centre launched a total of 70 structured
products, put together almost exclusively on the basis of shares
or raw-material values. On the other hand, the market environ-
ment for structured products on a fi xed-interest basis proved
insuffi ciently attractive for many investors. The upshot was
reduced activity in this sector.
Our portfolio managers once again achieved a very good result
in the area of asset-management mandates, clearely outdoing
the performance of their comparative indices (benchmarks) in
most investment objectives. The positive outcome is due mainly
to an overweighting in favour of share investments and raw
materials. It proved possible in this connnection to achieve a
marked increase not only in the number of mandates but also
in the volume managed.
4 HYPOSWISS Annual review 2006
Organs of the bank
Board of Directors Term of offi ce expires
Dr Urs Rüegsegger, Mörschwil, Chairman 2008
Dr Rico Jenny, Erlenbach, Vice-chairman 2009
Theodor Horat, Obfelden 2007
Executive BoardPresident (CEO)Marcel W. Schmid
MembersStefan Betschart, Managing Director
Martin Forster, Managing Director
Anton Schaad, Managing Director
Dr Thomas Stucki, Managing Director
Urs Eggenberger, Executive Director
AuditorsPricewaterhouseCoopers AG
Members of senior managementManaging DirectorsHans Bucher, Marek Wierzbicki
Executive DirectorsChristoph Angster, Markus Holenstein, Alexander Iten,
Otmar Keller, Dr Milan Kormanak, Caterina Minelle,
Rolf Müller, Patrick Schlessinger, Paul Sonderegger,
Heinz von Dach, René Wyss
DirectorsJürg Althaus, Gabriele Bosshard, Paulo Caminada,
Hansjürg E. Christen, Hans Peter Ehrler, Kurt Frischknecht,
Ernst Gfeller, Wolfgang Haller, Marc Jungi, Karl R. Keller,
Adrian D. Koller, Ueli Lott, Guido Lustenberger, René Merz,
Andreas Moser, Gregor Neidhart, Mauro Pivetta,
Daniel Reichmuth, Alfred Rüttimann, Daniel Schibli,
Roland Schneiter, Alfred Steininger, Giuseppe Stella,
Edna Weiner
HYPOSWISS Annual review 2006 5
The Board of Directors (l. to r.):Theodor Horat,Dr Urs Rüegsegger (Chairman),Dr Rico Jenny (Vice-chairman)
InnovativeTechnical innovations help to cross inhospitable terrain quickly.
It is the same when you are investing assets: being open to the
latest trends brings you more swiftly to your objective.
Markets CH / D / A / EAM International Markets Investment Center Products Services / Logistics Governance
Martin Forster, MD* Marcel W. Schmid, a.i. Dr Thomas Stucki, MD* Anton Schaad, MD* Stefan Betschart, MD* Urs Eggenberger, ED*
Switzerland / Austria / the rest of Europe
Eastern Europe Financial Analysis /Fonds Research
Credits Data Processing Secretary
Heinz von Dach, EDMarek Wierzbicki, MD
Jürg Althaus, DIAlex Rinderknecht, AD Ernst Gfeller, DI Urs Eggenberger, ED
GermanyLatin America /Spain / Portugal PM
Standard
Sales / Brokerage ORGA Legal / Compliance
Markus Holenstein, ED Otmar Keller, EDMarcel Rüdisüli, AD
Roland Schneiter, DI Mauro Pivetta, DI Daniel Schibli, DI
External Asset Managers
Senior customer adviserPM
Special
Taxes / FPWM Process Management
Paulo Caminada, DIHans Bucher, MD
Karl Keller, DI
Hans Peter Ehrler, DI Giuseppe Stella, DI
Structured Products
Human Resources / Reception
Accounting
Christoph Angster, ED
Ueli Lott, DIGregor Neidhart, DI
CashierSecurities
Administration
Philippe Bertholet, AD Guido Lustenberger, DI
Collateral Loans Payment Transactions
Oliver Lyhs, AD René Merz, DI
ALM / Treasury Internal Services
Anton Schaad, MD Giacomo Hagenbuch,AD
Executive Board
Marcel W. Schmid, CEO*
Business Management
Hansjürg E. Christen, DI
Secretariate
Vasiliki Furian, AD
Controlling
Gregor Neidhart, DI
Internal Audit / Risk Management
Adrian D. Koller, DI
Organisation as at 1 March 2007
* members of the Executive Board
CEO: Chief Executive Offi cerMD: Managing DirectorED: Executive DirectorDI: DirectorAD: Associate DirectorPM: Portfolio Management
HYPOSWISS Annual review 2006 7
Teamwork The more two people go through together, the better they
understand each other. Personal and demanding subjects also
belong in a truly confi dential dialogue.
Key statistics for 2006in 1 000 CHF 2006 2005 2004
Net interest income 21 447 14 618 10 473
Net fee and commission income 80 906 70 860 58 053
Net trading income 9 888 8 377 6 999
Other ordinary income 326 1 709 1 267
Operating income 112 567 95 564 76 792
Personnel expenses 32 226 30 065 26 742
Other operating expenses 23 564 13 943 12 954
Administrative expenses 55 790 44 008 39 696
Gross profi t 56 777 51 556 37 096
Depreciation, write-offs on fi xed assets 1 305 1 094 781
Valuation adjustments, provisions, and losses 4 790 538 535
Operating profi t 50 682 49 924 35 780
Extraordinary income/expenses 8 024 -11 000 0
Taxes -11 226 -10 604 -8 945
Net profi t for the year 47 480 28 320 26 835
Shareholders’ equity (after use of profi t) 102 792 102 992 85 672
Customer assets (including double counts) 12 399 086 8 772 080 6 732 693
Cost/income ratio (%) 50.7 47.2 52.7
Staff
No. of personnel units 146 134 134
Key Data 2006
HYPOSWISS Annual review 2006 9
CompetitiveTechnique, strength, equipment, mental attitude. For top
performances such as those produced by four-times world
champion snowboarder Ursula Bruhin, whom HYPOSWISS
has sponsored for years, many things have to slot together.
She must also possess enormous endurance and a fi erce
determination to succeed.
In a highly dynamic environment HYPOSWISS achieved an
outstanding result. For the fi rst time the bank’s operating income
exceeded CHF 100 m; to be precise, it reached CHF 112.6 m.
Administrative expenses rose by 27 % to CHF 55.8 m. A large
part of this cost increase was due to project and migration
costs for the changeover to the Avaloq Banking System. Thanks
to the new operating system, from 2007 onwards IT operating
costs will be very much lower. As a result, gross profi t rose
disproportionately by CHF 5.2 m or 10 %; the previous year’s
CHF 51.6 m became CHF 56.8 m. Leaving the said costs out of
account, a gross profi t of CHF 64.5 m would have resulted,
corresponding to an increase of 25 % over the previous year.
Depreciation and write-offs on fi xed assets were slightly up on
the previous year, as a result of one-off licensing costs for the
new EDP-system being entered on the assets side. During the
course of 2006, mortgage-secured loans were subjected to
thorough scrutiny. It turned out that certain items were critical.
To take account of this circumstance, reserves in the amount
of CHF 3.7 m were formed, a fi gure that corresponds to 0.44 %
of loans granted.
Extraordinary income includes the projected dissolution of
reserves for general banking risks in the amount of the project
and migration costs incurred plus a liquidation profi t.
The net profi t for the year of CHF 47.5 m achieved made it
possible substantially to increase our dividend distribution to
our shareholder from CHF 22.0 m to CHF 40.0 m.
As a result of the investments described, the proportion of
administrative expenses including depreciation and write-offs
on fi xed assets went up from 47 % to 51 % in the year under
review.
The balance-sheet total shown by HYPOSWISS at the end of
the fi nancial year was CHF 1 147.8 m. This corresponds to
an increase of CHF 211.3 m or 23 % compared with the previous
year’s fi gure of CHF 936.4 m. Total shareholders’ equity, after
use of profi t, are shown as CHF 102.8 m, corresponding to a
degree of self-fi nancing of 9 %.
Customer deposits and current assets shown went up markedly
in the course of the fi nancial year from CHF 8.8 billion to
CHF 12.4 billion. That fi gure includes CHF 934.4 m due to the
fi ve HYPOSWISS investment funds. People who have been
customers for many years and new customers entrusted
HYPOSWISS with new money in the amount of CHF 2 691.2 m
for the bank to invest and manage.
Financial section
Summary
HYPOSWISS Annual review 2006 11
Of which loans to customersTotal 840 870 (in 1 000 CHF )
AssetsBalance-sheet total 1 147 753 (in 1 000 CHF )
Assets Total loans to customers (i.e. the items Due from customers and Mortgages) rose from CHF 669.6 m to CHF 840.9 m. Most
accounts receivable from our customers are Lombard loans or
are covered by pledged fi duciary investments.
In detail, Fixed advances and loans rose by CHF 187.7 m to
CHF 563.1 m. Current-account debtors went down by CHF 6.5 m,
reaching a fi gure of CHF 48.4 m by year-end. In a fi ercely
competitive Swiss real-estate fi nancing market, our stock of
Mortgage loans went down from CHF 239.2 m to CHF 229.4 m.
Financial investments declined as a result of sales and repay-
ments by debtors to a nominal level of CHF 2.5 m. Of that fi gure,
CHF 2.0 m have been invested in new bonds.
At year-end, the holding of these securities was in the amount
of CHF 13.9 m. They are held primarily as liquidity reserves.
Investments in Fixed assets reached a fi gure of CHF 2.9 m.
After deduction of necessary write-offs of CHF 1.3 m, they
appear in the balance sheet at CHF 7.4 m. Acquisitions princi-
pally concern software and hardware installations for the new
Avaloq Banking System.
About the balance sheet
Due from customers
840 870
Financial investments and participations
14 096 1,2 %
Due from banks
259 740
Mortgage loans
229 364 27,3 %
Current-account receivables
48 371 5,7 %
Fixed advances and loans
563 13567 %
Other assets
19 907 1,7 %
73,3 %
22,6 %
12 HYPOSWISS Annual review 2006
Liquid assets
13 140
1,2 %
Liabilities By the end of the fi nancial year funds entrusted to HYPOSWISS
by customers totalled CHF 573.2 m. This corresponds to an
increase of CHF 112.5 m or 24 %. The biggest item on the balance
sheet is Other amounts due to customers at CHF 550.3 m,
followed by Amounts due to customers in the form of savings and deposits at CHF 19.1 m. Medium-term notes went up to
CHF 3.8 m. Substantially higher long-term interest rates led over
the course of the fi nancial year to our customers once again
investing more heavily in HYPOSWISS time-deposit investments.
These climbed from CHF 17.3 m to CHF 107.2 m.
Because of the sharp rise in loans to customers, Amounts due to banks went up by CHF 101.2 m to CHF 326.2 m. Long-term
mortgage-backed bonds declined by CHF 15.0 m to a fi gure of
CHF 56.0 m.
Share capital stands unchanged at CHF 26.0 m, while open
reserves after use of profi t are shown at CHF 67.5 m.
Demand deposits
443 01277,3 %
Amounts due to customers in the form of savings or deposits
19 087 3.3 %
Time deposits
107 248 18.7 %
Medium-term notes
3 825
0,7 %
Mortgage-backed bonds
56 000
Customer deposits
573 172
LiabilitiesBalance-sheet total 1 147 753 (in 1 000 CHF )
4.9 %
Due to banks
326 240 28.4 %
Other liabilities
97 029
Shareholders’ equity
95 312 8.3 %
49,9 %
Of which customer depositsTotal 573 172 (in 1 000 CHF )
8.5 %
HYPOSWISS Annual review 2006 13
About the income statement
Depreciation and provisions
6 095
5,1 %
Personnel expenses
32 22626.7 %
Net profi t for the year
47 48039,4 %
Net fee and commission income
80 90667,1 %
Extraordinary income
8 024
Other income
326
0,2 %
Net trading income
9 888 8,2 %
6,7 %
Taxes
11 226 9.3 %
ExpenditureTotal 120 591 (in 1 000 CHF )
IncomeTotal 120 591 (in 1 000 CHF )
Other operating expenses
23 564 19,5 %
Net interest income
21 447 17,8 %
14 HYPOSWISS Annual review 2006
We were able, during the year under review, to increase Net interest income by CHF 6.8 m to CHF 21.4 m. This result was
made possible by rising interest rates in the year under review
as well as by an increase in loans to customers.
Continued favourable development of international capital
and money markets affected the fee and commission business
of HYPOSWISS (our core activity) in an extremely satisfactory
way. We were able to boost earnings by a further CHF 10.0 m
compared with the previous year, reaching CHF 80.9 m. Earnings
from the fi ve HYPOSWISS investment funds also grew satis-
factorily.
Net trading income was increased by CHF 1.5 m to CHF 9.9 m.
Contributory causes were customer transactions and (to a lesser
extent) proprietary trading as well.
Administrative expenses increased in the year under review by
CHF 11.8 m, reaching a fi gure of CHF 55.8 m. Greater staff
numbers led to higher salary costs and the concomitant social-
security contributions. Moreover, performance-related bonuses
went up as a result of the positive development of the operat-
ing profi t.
Other operating expenses rose by CHF 9.6 m in the year under
review, reaching CHF 23.6 m. A major part of this cost increase
(namely, CHF 7.7 m) was due to project and migration costs for
the new Avaloq Banking System.
The dissolution of reserves for general banking risks entered
under Extraordinary income was effected in order to offset the
project and migration costs for the Avaloq Banking System.
In the previous year CHF 11.0 m had been added to the reserve
for this purpose. Moreover, this item includes the profi t realised
from liquidation of HYPOSWISS Fund Management Company SA,
Luxembourg.
HYPOSWISS Annual review 2006 15
Personnel
During the course of the year under review the following
promotions were made to senior management level:
To Managing Directors
Hans Bucher, Marek Wierzbicki
To Executive Director
Caterina Minelle
To Directors
Paulo Caminada, Ueli Lott
We attach enormous importance to the ongoing training and
development of our employees. Consequently, much use was
once again made during the year under review of the wide range
of in-service and external training opportunities available.
It was with the greatest sympathy and regret that we took leave,
in the past year, of a long-serving customer adviser and member
of senior management, Kurt W. Buchmann. Mr Buchmann died
in Zurich on 1 June 2006 after a brief but severe illness. We shall
hold him in honoured memory.
Our thanks go to each and every member of our staff for their
great commitment and for special services rendered in connec-
tion with introducing the new IT platform.
Zurich, 25 January 2007
For the Board of Directors: For the Executive Board:
Dr Urs Rüegsegger, Chairman Marcel W. Schmid, CEO
16 HYPOSWISS Annual review 2006
Income and expenditure from ordinary banking businessin 1 000 CHF 2006 2005
Interest and discount income 28 752 17 391
Interest and dividend income on fi nancial investments 382 518
Interest expenditure -7 687 -3 291
Net interest income 21 447 14 618
Commission income from lending activities 472 360
Commission income from securities and investment activities 82 864 73 474
Commission income from other service fee activities 629 591
Commission expenses -3 059 -3 565
Net fee and commission income 80 906 70 860
Net trading income 9 888 8 377
Other ordinary income 326 1 709
Net other income 326 1 709
Operating income 112 567 95 564
Personnel expenses 32 226 30 065
Other operating expenses 23 564 13 943
Administrative expenses 55 790 44 008
Gross profi t 56 777 51 556
Profi t for the year
Gross profi t 56 777 51 556
Depreciation/write-offs on fi xed assets -1 305 -1 094
Valuation adjustments, provisions and losses -4 790 -538
Operating profi t (before extraordinary items and taxes) 50 682 49 924
Extraordinary income 8 024 0
Dissolution of reserves for general banking risks 7 680 0
Extraordinary expenses 0 -11 000
including: formation of reserves for general banking risks 0 -11 000
Taxes -11 226 -10 604
Net profi t for the year 47 480 28 320
Income Statement 2006
HYPOSWISS Annual review 2006 17
Assets in 1 000 CHF 2006 2005
Liquid assets 13 140 13 062
Accounts receivable from money-market securities 0 9 971
Due from banks 259 740 213 600
Due from customers 611 506 430 332
Mortgage loans 229 364 239 227
Financial investments 13 912 14 498
Participation 184 409
Fixed assets 7 364 5 815
Accrued income and prepaid expenses 7 342 3 126
Other assets 5 201 6 382
Total assets 1 147 753 936 422
Total due from group companies and qualifi ed participants
149 129 160 486
Balance sheet at 31 December 2006 before use of profit
18 HYPOSWISS Annual review 2006
Liabilitiesin 1 000 CHF 2006 2005
Due to money-market instruments 222 206
Due to banks 326 240 225 026
Due to customers in savings and deposit accounts 19 087 32 426
Other amounts due to customers 550 260 425 010
Medium-term notes 3 825 3 250
Mortgage-backed bonds 56 000 71 000
Accrued expenses and deferred income 27 804 19 948
Other liabilities 10 065 26 440
Valuation adjustments and provisions 11 458 8 124
Reserves for general banking risks 5 020 12 700
Share capital 26 000 26 000
Legal reserve 36 500 34 400
Other reserves 21 000 17 000
Profi t brought forward 6 792 6 572
Net profi t for the year 47 480 28 320
Total liabilities 1 147 753 936 422
Total due to group companies and qualifi ed participants
232 054 138 039
Off-balance-sheet operations
Contingent liabilities 83 646 79 092
Irrevocable promises 2 256 0
Uncalled liabilities to pay in capital or additional capital on shares 1 512 1 512
Derivative fi nancial instruments 454 145 807 029
Positive gross replacement values 5 088 4 077
Negative gross replacement values 4 948 5 061
Fiduciary transactions 4 210 537 1 774 831
Jahresrechnung
Bilanz per 31. Dezember 2005 vor Gewinnverwendung
HYPOSWISS Annual review 2006 19
All things SwissLong-term deals thrive on solid foundations. Switzerland is
a byword for stable conditions.
Appropriation of disposable profi t in 1 000 CHF 2006 2005
Net profi t for the year 47 480 28 320
Balance brought forward from previous year 6 792 6 572
At the disposal of the General Meeting (profi t as shownin the balance sheet)
54 272 34 892
The Board of Directors proposes that this amount be distributed as follows:
a) Payment of a dividend 40 000 22 000
b) Allocation to legal reserve 4 000 2 100
c) Allocation to other reserves 6 000 4 000
d) Balance carried forward to new account 4 272 6 792
Total 54 272 34 892
Upon approval of this proposal, total shareholders’ equity will comprise
Share capital 26 000 26 000
Legal reserve 40 500 36 500
Other reserves 27 000 21 000
Reserves for general banking risks 5 020 12 700
Balance carried forward to new account 4 272 6 792
Total 102 792 102 992
Appropriation of disposable profi t
HYPOSWISS Annual review 2006 21
Cashfl ow account
in 1 000 CHF Year under review Previous year
Origin ofresources
Use ofresources
Balance Origin ofresources
Use ofresources
Balance
Profi t for the year 47 480 28 320
Depreciation/write-offs on fi xed assets 1 305 1 094
Valuation adjustments and provisions 3 334 3
Reserves for general banking risks 7 680 11 000
Active deferrals 4 216 977
Passive deferrals 7 856 3 384
Previous year’s dividend 22 000 22 000
Cashfl ow from operating result (internal fi nancing)
59 975 33 896 26 079 43 798 22 980 20 818
Participations 287 62
Fixed assets 2 854 1 350
Cashfl ow from operations in fi xed assets
287 2 916 -2 629 1 350 -1 350
Due to money-market instruments 16 4
Due to banks 101 214 208 080
Receivables from money-market instruments 9 971 9 971
Due from banks 46 140 89 598
Interbank transactions 111 201 46 140 65 061 208 080 99 573 108 507
Medium-term notes 575 1 720
Due to customers in savings and deposit accounts
13 339 7 916
Other amounts due to customers 125 250 61 950
Mortgage loans 9 863 3 305
Due from customers 181 174 217 163
Customer business 135 688 194 513 -58 825 63 670 228 384 -164 714
Financial investments 586 9 218
Mortgage-backed bonds 15 000 2 000
Capital-market business 586 15 000 -14 414 11 218 11 218
Other assets 1 181 15 385
Other liabilities 16 375 10 639
Other balance-sheet items 1 181 16 375 -15 194 26 024 26 024
Cashfl ow from banking business 248 656 272 028 -23 372 308 992 327 957 -18 965
Liquid assets 78 -78 503 -503
Sources of funds 308 918 352 790
Uses of funds 308 918 352 790
22 HYPOSWISS Annual review 2006
Auditors’ report
Report of the statutory auditors to the General Meeting of
HYPOSWISS Private Bank Ltd., Zurich.
As statutory auditors we have examined the bookkeeping and
annual accounts (income statement, balance sheet, cashfl ow
account and appendix) of HYPOSWISS Private Bank Ltd., Zurich,
for the fi nancial year ended 31 December 2006.
Responsibility for the annual accounts lies with the board;
our task consists in examining those accounts and passing judge-
ment thereon. We confi rm that we meet the statutory require-
ments with regard to competence and independence.
Our examination complied with the Swiss standards of auditing
whereby an audit is to be planned and executed in such a way
that major misstatements in the annual accounts are recog-
nised with reasonable certainty. We examined the items of and
information given in the annual accounts, using analyses and
investigations on a random-sample basis. We also assessed the
application of the standard principles of rendering of account,
key decisions regarding valuation, and the presentation of the
annual accounts as a whole. We take the view that our exami-
nation provided an adequate foundation on which to judge.
In our estimation, the bookkeeping and annual accounts,
together with the motion regarding use of the profi t shown in
the balance sheet, are in conformity with Swiss law and with
the articles of association.
We recommend that the present annual accounts be adopted.
Zurich, 8 February 2007
PricewaterhouseCoopers AG
Pascal Portmann Thomas Kleger
Chief auditor
HYPOSWISS Annual review 2006 23
The following auditors’ report refers to the annual report 2006, which can be ordered from HYPOSWISS Private Bank Ltd.
Impressum© 2007 HYPOSWISS Private Bank Ltd.PlanningThe Investor Relations Firm AG, ZurichDesign TGG Hafen Senn Stieger, St.GallenIllustrationsPortraits page 4 and 5, photos T+T Fotografi e, Toni Sutter, Zurichpage 8, photographer Lorenz Andreas Fischerpage 10, photographer WojtechRemaining pictures, Image Point
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