Berenberg reports highest earnings in its 427-year history, as the bank cements its place on the investment scene

Hayley Kirton
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Berenberg has announced it has boosted its profits for the second year in a row (Source: Getty)

Berenberg began today on a high, announcing its highest annual earnings to date in its 427-year history.

The figures

The world's second-oldest bank reported net profits had risen to €161m (£139m), up 56 per cent compared with €104m the year before and marking the second year in a row its bottom line has set a new record.

Meanwhile, gross income grew to €510m, up 21 per cent compared with the prior year's €423m.

The bank also increased the size of its workforce to 1,506, up 13 per cent from 1,331.

Berenberg also boosted its tier 1 capital ratio from 12.4 per cent at the end of 2015 to just over 13 per cent at the end of 2016.

Why it's interesting

It's currently a tough time for the banking sector. Interest rates are rock bottom by historic standards, leaving many clients second guessing how best to stash their cash. Meanwhile, uncertainty last year, which was not helped by the EU Referendum and US Presidential elections, scared other clients away from big ticket decisions.

However, for Berenberg, business is booming. The bank also announced today it had increased its market share for its investment banking business, completing M&A transactions worth more than €5bn and maintaining its position as leading IPO adviser for German-speaking countries for the third year on the trot.

Meanwhile, the bank plans to expand its wealth and asset management offering, having nabbed industry veteran Henning Gebhardt from Deutsche Bank to take on the role of head of wealth and asset management.

What Berenberg said

"While markets were characterised by high levels of uncertainty, the bank recorded another year of strong performance," said Hendrik Riehmer, Berenberg's managing partner. "This underlines the quality of Berenberg's offering and business model."

And, on the topic of June's Leave vote, Riehmer added:

We see more advantages than disadvantages in London arising from Brexit in the coming years.

Unlike many banks from outside the EU, as a German bank we will not have to make changes to our business in order to be able to do business in the EU. We believe that the potential departure of competitors means that we will be able to hire more and even better qualified staff in London.

In short

Berenberg has proved that, after over 400 years in the business, it's still possible to keep going strong.

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