In the first quarter 2020, Cembra delivered a strong business performance with net revenues increasing by 19% year-on-year (organic growth +1%) to CHF 128.2 million. Net interest income grew by 24% due to the successful commercial integration of cashgate. Commission and fee income increased by 6%, with credit card fees and commissions declining by 3%. In the month of March 2020, the credit card transaction volumes declined by 17% year-on-year due to lower spending abroad following the Covid-19 lockdown in Switzerland.

Net financing receivables amounted to CHF 6,449 million at the end of March 2020, down 2% compared to year-end 2019. Lower assets in credit cards were largely offset by a stable trend in personal loans and auto financing.

The loss rate in the first quarter 2020 improved year-on-year and was better than the corresponding budget. In the month of March, the 30+ days delinquencies and losses were in-line with the budgeted amounts. Operating expenses remained below the budgets due to benefits of the integration of cashgate, which is progressing as planned. As a result, net income for the first quarter 2020 came in above the management's budget.

The Group currently expects to deliver a resilient business performance in 2020, with revenues being impacted mainly by overall lower volumes in credit cards. Cembra confirms its mid-term targets¹ but suspends detailed guidance for 2020 due to the uncertainties related to the impact of Covid-19 on the Swiss economy and related governmental measures. Cembra will publish its half-year results on 23 July 2020.

¹ Mid-term targets ROE > 15%, Tier 1 capital ratio 17% and dividend pay-out ratio 60-70%; assuming a recovery of the Swiss economy in 2021