Page 13 - Maerki Baumann & Co. AG | Annual Report 2021

particularly in view of the pandemic-related savings measures in the previous year. Operating expenses thus amounted to CHF 33.62 million, equivalent to a rise of CHF 3.46 million or 11%. A positive development of note was the reduction in the cost-income ratio from 86% to 79% in the reporting year, despite the higher operating expenses. Assets under management surged by a very impressive CHF 1.66 billion in 2021 to CHF 10.26 billion, equiv- alent to a rise of more than 19%. This increase in the asset base is attributable to positive performance of CHF 724 million and net new assets of CHF 934 mil- lion. With the exception of one month, net new asset growth was positive throughout the year, underscoring the significant growth momentum enjoyed by Maerki Baumann. In keeping with our market strategy, 80.3% of assets under management at the end of 2021 related to the Swiss market, and 8.5% to the German market. Maerki Baumann has well-established systems in place for identifying, limiting and monitoring its key risks. The Board of Directors and Executive Board regularly engage with the relevant market, credit, liquidity and operational risks. The bank’s conservative risk and busi- ness policy is reflected in its excellent liquidity and cap- ital adequacy ratios. The liquidity coverage ratio aver- aged 323.2% in 2021, well in excess of the requirement of 110% stipulated by the regulatory regime that applies to small banks. Given the highly promising growth out- look, we issued a subordinate “additional tier 1” bond in December 2021. Together with the retained profit of CHF 3.5 million in 2021, this measure resulted in an increase in core capital of around CHF 17 million (+31%). Maerki Baumann also classifies a proportion of the hidden reserves relating to the bank building as supplementary capital (tier 2 capital), which amounts to CHF 8.8 million after the deduction of deferred tax assets. In keeping with these developments, at the end of 2021 our private bank had increased its BIS core capital ratio (tier 1 ratio) by 3.2 percentage points to 27.4%, as against the regulatory minimum of 10.5%. The total capital ratio stood at 30.7% at the year-end. This very robust capital base not only testifies to the stability of our private bank’s balance sheet struc- ture, it also gives us the necessary flexibility to finance future growth. Outlook It is our conviction that generating a financial return while at the same time having a positive impact on the environment and society are mutually compati- ble objectives. For this reason, we have signed up to the UN Principles for Responsible Investment. We also 13 Maerki Baumann & Co. AG