Schaffhauser Kantonalbank (SHKB) earned significantly less in the first half of the year despite increasing customer loans and customer deposits. The half-year profit fell by almost a third.

In comparison to the «exceptionally strong previous year» a «solid but significantly lower result» was achieved, according to a statement on Friday.

Operating profit fell by 28 percent to 32.7 million Swiss francs compared to the same period last year. The half-year profit fell by as much as 32 percent to 22.8 million francs.

Most Important Source of Income Weakens

Gross income in the interest business, the most important source of income for the financial institution, fell by 24 percent to 40.4 million francs, while the commission and services business was down 6.4 percent to 20.7 million francs. This contrasts with a 7.3 percent increase in income from the trading business to 7.7 million francs.

The reduction of key interest rates to 0 percent in mid-June 2025 - after the end of the negative rate era in 2022 - has pushed interest income to a new low, the bank reports. Money market mortgages were hit particularly hard due to their high rate sensitivity. As a result, operating income dropped 14 percent to 71.3 million francs.

Operating expenses increased only slightly by 0.7 percent to 35.9 million francs.

Higher Customer Lending

Higher customer activity was seen in the first quarter in particular. In the first half of the year, customer loans rose by 1.0 percent and customer deposits by 1.4 percent.

Targeted investments were made in digitalization and advisory services, the report continues. The introduction of a new CRM system and digital account opening have improved the customer experience. The strategic staff expansion is progressing successfully and staff turnover remains low.

Despite the challenging market environment, the company is looking to the future with confidence. The continued strong demand for mortgages, pleasing new customer additions and the positive development in the investment business are proof of the confidence in the bank.