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• Net Profit: Increased by 44% to EUR74.5 million.

• Operating Expenses: Rose 6%, resulting in a cost/income ratio of 69%.

• Assets Under Management (AUM): Net inflows of EUR5.7 billion, total AUM reached over EUR139 billion.

• Capital Ratio: CET1 ratio at 18.5% (Basel IV), above the target of 17.5%.

• Commission Income: Main driver of increased results, with a good growth in AUM.

• Interest Income: Lower than last year but in line with the second half of 2023.

• Private Clients Netherlands: Operating result before tax at EUR71.6 million, with an inflow of EUR1.8 billion.

• Private Clients Belgium: Net inflow of EUR1.1 billion, AUM increased to EUR13.7 billion.

• Investment Management Clients: Operating result before tax improved to EUR13.5 million, inflow of EUR2.8 billion.

• Investment Banking: Returned to profitability with an operating result before tax of EUR3 million.

• Recurring Fees: Grew to EUR468 million, aligning with AUM growth.

• Loan Portfolio: Stable with a small decline in the mortgage portfolio, average LTV improved to 61%.

• Warning! GuruFocus has detected 7 Warning Sign with FRA:VA3.

Release Date: August 22, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Van Lanschot Kempen NV (FRA:VA3) reported a strong net profit increase of 44% to EUR74.5 million for the first half of 2024.

• The company achieved a significant growth in assets under management, adding EUR5.7 billion from new and existing clients, reaching nearly EUR140 billion.

• All client segments, including Private Banking Netherlands, Belgium, Investment Management, and Investment Banking, were profitable, demonstrating a well-rounded performance.

• The company maintained a robust capital ratio, well above its target, and plans to return excess capital to shareholders by year-end 2024.

• Van Lanschot Kempen NV (FRA:VA3) is on track with its non-financial targets, including a significant reduction in carbon intensity of its discretionary assets under management.

Negative Points

• Operating expenses rose by 6%, leading to a cost/income ratio of 69%, which, while demonstrating scalable growth, indicates rising costs.

• Interest income was lower compared to the previous year, although it remained stable compared to the second half of 2023.

• The company faces challenges in maintaining margins, particularly in the Private Clients Netherlands segment, where margins decreased from 60 to 55 basis points.

• There is uncertainty regarding the sustainability of net inflows, particularly in the Netherlands, where tax effects and client behavior could impact future inflows.

• The integration of recent acquisitions, such as Robeco and Accuro, requires careful management to ensure successful integration and realization of expected benefits.