As part of its parent company's financial results released on Thursday, Postfinance also presented its own figures for the first half of the year. According to the accounting standards for banks, half-year profits fell from 90 million francs to 64 million francs. The sale of a stake, which generated an extraordinary income of 36 million francs, prevented the decline from being even worse.

Although Postfinance has bank status, it is legally very restricted in lending. In particular, it is not allowed to independently issue mortgages. As a result, well over half of its assets (57 billion francs out of total assets of 102 billion francs) are invested in financial assets – the institution is one of the largest investors in the Swiss bond market for good reason.

Customer deposits declining

Customer deposits are also declining. They fell from 89,6 billion francs to 87,3 billion francs. In the retail sector, customer deposits remained stable, but institutional investors «as usual reacted more strongly to volatile money and capital markets,» according to the half-year report. The assets managed on behalf of customers for investment purposes increased from 37,7 billion francs to  39 billion francs, although 66 million francs net flowed out.

Net income in the interest rate business, which is central to Postfinance, fell from 254 million francs to 213 million francs, with a 25 million francs write-down «on an individual position in our investment portfolio» also being painful.

More staff for increased customer satisfaction

There was better performance in the commission and services business, where Postfinance was able to increase earnings from 189 million francs to 199 million francs, also thanks to gains from exchange rates. The offer for trading and custody of cryptocurrencies, which was launched at the beginning of the year, has started off well and was specifically mentioned in this context – it was also awarded a prize at the 2024 Swiss Crypto Awards, as reported by finews.com.

Operating expenses, however, have increased significantly, from 470 million francs to 502 million francs. The new 134 full-time positions (total staff of 3'448) had a significant impact on personnel expenses. In IT, previously external specialists were internalized and new teams were formed. In sales, measures to improve customer satisfaction and «stabilize accessibility» led to the creation of more jobs.

High sight deposits at the National Bank

In its outlook, Postfinance first looks back, noting that it welcomed the return to a positive interest rate environment in autumn 2022, also in the interest of its customers, but has not benefited from the interest rate cuts made by the Swiss National Bank (SNB) this year.

These cuts led to lower interest income; Postfinance holds 28 billion francs in liquid assets, the majority of which are sight deposits with the SNB (the lower the key interest rate, the lower the corresponding interest income). In addition, Postfinance wrote that the SNB's adjustments to the minimum reserve requirements have increased the amount of non-interest-bearing sight deposits.

Delayed recovery in financial investments

Second, monetary policy affected interest income forecasts, particularly for financial assets. The recovery in the interest rate business associated with the return to positive interest rates will therefore take longer than predicted a year ago. As mentioned earlier, Postfinance holds an extensive bond portfolio, with maturities being reinvested. The higher yield levels will therefore only translate into higher returns on financial assets in the medium term.

Postfinance is not alone in this; the SNB's easing measures this year and further steps in the implementation of monetary policy have made the interest rate business more difficult for the industry as a whole, as noted by finews.com.

CEO Beat Röthlisberger, who took office in July, cannot control the development of interest rates – but the half-year report suggests that he will have a lot of work to do in the coming months, regardless of whether interest rates remain stable or continue to fall.