23 March 2017
- The company has presented its 2017-2020 Strategic Plan, which aims to place its ROE between 9% and 11%
- The plan covers actions across three lines of Cecabank activity (Securities Services, Treasury Management and Banking Services)
Cecabank, the Spanish benchmark in wholesale banking and Securities Services, presented its results for 2016. It also presented its 2017-2020 Strategic Plan. Last year the bank, chaired by Antonio Massanell, obtained a pre-tax profit of €108 million. This represents an improvement compared to 2015 (+€2.9 million) and maintaining high levels of solvency. These levels place it above the average for the financial sector, with a CET 1 ratio of 31.87%.
On 9 February, the rating agency Standard & Poor’s confirmed the ratings of the institution at BBB. Its outlook was upgraded from stable to positive, due to the consolidation of Cecabank's business model. One of the main strengths of this B2B model is its neutrality. Because being exclusively wholesale, it does not have a network and does not distribute retail financial products. As a depositary bank, it does not participate in asset management, which gives it an independence that is highly appreciated by its customers.
Cecabank has a governance structure that meets the highest international standards of corporate governance. It also has a highly professional Board in which more than a third of its members are independent.
The financial margin once again showed great robustness. It rose above 95.5 million euros in 2016, showing growth that is particularly significant given the difficulties of the current context of low interest rates in the euro area. Growth is underpinned by the increased trading on behalf of third parties, together with the entry of new customers. Fees were placed at 158 million euros due to an increase in assets under custody.
2017-2020 Strategic Plan
For the coming years, the company intends to increase its gross margin (as a general business indicator when adding financial margin and fees) to 270 million euros in 2020. This figure assumes average annual growth in excess of 2%. To achieve this, the strategic plan sets out several projects in the company's three main lines of business. These include innovation (developing and implementing technological improvements), expanding the customer base and adding to services, for example in the execution of equities.
In the Securities Services area, the aim will be to strengthen the current leadership position in the depositary market. This will be done through new services in the value chain (custody of Fixed Income for banks and services specific to Securities Companies). It will also take advantage of the opportunities offered by the reform of Target 2 Securities. New regulations coming into force that strengthen the position of independent depositaries mean new opportunities on the European market can now be explored.
With these levers, the company expects to post a ROE of between 9% and 11% in 2020 (compared with 8% at the end of 2016) and continue to provide value to its customers, shareholders and the Spanish financial system as a whole.
