Valiant posted fourth-quarter results that outpaced analyst expectations, with operating income coming in 2% above forecasts and a pre-tax profit of CHF62 million, a figure 14% higher than anticipated. The Swiss lender attributed its outperformance primarily to stronger-than-expected net interest income and solid commission and fee performance.
After allocating CHF4 million to reserves for general banking risks, the bank reported net income of CHF46 million, exceeding the consensus estimate of CHF44 million. Net interest margin edged up by 1 basis point quarter-over-quarter to 109 basis points, while the mortgage book expanded modestly by 0.9% during the quarter.
Commission and fee income also beat expectations, landing 2% above forecasts. That positive contribution was offset in part by a shortfall in trading income, which was 15% below forecast.
On the cost side, Valiant reported operating expenses that were 5% lower than expected, reflecting tighter cost control for the quarter. The bank’s common equity tier 1 (CET1) ratio stood at 17.2%, above the 16.5% consensus figure.
Valiant’s capital and capital-return decisions struck a mixed tone for investors. The bank declared a dividend of CHF6.0 per share, below the CHF6.4 some had expected. At the same time, management announced a CHF75 million share buyback programme to be executed over three years. The repurchase plan is conditional on the bank maintaining a CET1 ratio within a 15-17% range.
In addition to financial measures, the bank disclosed planned leadership changes. Current chairman Markus Gygax is scheduled to step down in 2028. Chief executive Ewald Burgener will succeed him, following a one-year cooling-off period after leaving the CEO role in 2027.
The quarter’s results combined stronger recurring earnings from interest and fees with lower-than-expected trading revenues. Cost discipline supported the bottom line and left capital adequacy at a level above consensus, enabling management to propose a buyback while trimming the dividend slightly below market expectations.
Investors and market participants will likely monitor the execution of the CHF75 million buyback over the next three years and the bank’s ability to keep its CET1 ratio inside the stated 15-17% corridor while managing mortgage book growth and trading volatility.