Van Lanschot Kempen (VLK) H2 2024 earnings summary

Executive summary

• Net result increased 13% year-over-year to €141.9 million, driven by strong commission income growth, robust net AuM inflows of €9.2 billion, and high client satisfaction.

• Assets under management (AuM) grew 17% to €149.3 billion, with growth from both new and existing clients, reflecting market share gains and positive market performance.

• Continued execution of the "Growing Further Together" strategy, including expansion in Belgium, digital excellence, and new private equity fund launches.

• Significant investments in client-facing talent, AI, technology, and private market solutions to support scalable, capital-light growth.

• Sustainability targets exceeded, with a 44% reduction in organizational carbon footprint since 2019 and progress on gender pay gap.

Financial highlights

• Commission income rose 20% to €511.2 million, while interest income declined 11% to €175.4 million due to margin normalization and client asset shifts.

• Net result reached €141.9 million, a 13% increase compared to 2023.

• Operating expenses increased 6% to €502.8 million, below the 8% rise in income, reflecting scalability.

• Cost/income ratio improved to 70.1% (2023: 71.6%), progressing toward the 67%-70% target.

• Proposed dividend of €2.75 per share and capital return of €1.40 per share, both planned for June 2025.

Outlook and guidance

• On track to achieve 2027 targets, including AuM growth (10% CAGR), cost/income ratio 67-70%, and return on CET1 above 18%.

• Interest income for 2025 expected between €155 million and €165 million, reflecting client asset shifts and anticipated ECB rate cuts.

• Continued focus on growing commission income, especially in investment banking, and maintaining positive operating jaws.

• CET1 ratio (Basel IV fully loaded) expected to decrease to 18.0% after capital return, still above the 17.5% target.

• Continued intention to return excess capital to shareholders annually.