Of Special Interest
29th July 2011
Lazard profitable significant growth
Lazard reported net profit of $62.0m (€42.9m £37.9m ¥4,827m Y399.5bn) for Q2 and $117.0m (€81.0m £71.5m ¥9,108m Y753.9m) for the half year up 39% on the year ago quarter and up from $11,038m for the first half of 2010. Under Lazard's preferred method of calculating profit as if all of Lazard's operations are within the one listed company - the 'Fully Exchanged and Adjusted Method', the profits were $65.8m and $124.3m, UP 24% and 9% on last year respectively.
Lazard has the advantage of having never been a major player within FICC and therefore has not shown the consequences of the major slowdown in this area that other investment banks have. Very impressive is the 19% operating revenue gain from M&A and Strategic Advisory, Capital Markets and Other Advisory in a very quiet market. The bank may be benefiting from its specialism, its clean reputation, and clients knowing there is less likelihood of conflicts of interest occurring.
Asset Management operating revenue increased 27% to $237.7m and increased 24% to $461.7, both records. The unit had AUM of $161.6bn, an increase of 31% on a year ago.
"Our strong first-half performance underscores the power of Lazard's advice-driven, intellectual capital model," said Kenneth M. Jacobs, Chairman and Chief Executive Officer of Lazard. "Companies, government bodies and investors continue to demand independent advice with a geographic perspective, deep understanding of capital structure, informed research, and knowledge of global economic conditions during this uneven economic recovery."
"Over the past year, we have invested strategically in both our Financial Advisory and Asset Management businesses through hires and initiatives to continue to grow the franchise and serve our clients worldwide," said Mr. Jacobs.
"Our simple business model of Financial Advisory and Asset Management is well positioned, as the need for independent strategic advice and superior investment solutions continues to increase," said Matthieu Bucaille, Chief Financial Officer of Lazard. "We remain focused on growing revenue, maintaining cost discipline, managing our capital and investing in our businesses for the future."