PR83714

BRUSSELS, April 17, 2020 /PRNewswire=KYODO JBN/ --

- Q1 20 revenues up 9% year-on-year, to EUR 383 million

- Business Income rose 15% to EUR 321 million

- Banking and Other Income decreased 14% to EUR 62 million

- Operating costs up by 4% to EUR 213 million, in line with expectations

- Net profit was up 29% to EUR 127 million

- Dividend approval to be postponed to Q4 2020 in light of recent ECB guidance

- Liquidity initiative stopped due to current uncertain environment

- COVID-19 outlook: business income evolution uncertain; interest-related

income hit by interest rate cuts

Business update

Global markets are exceptionally volatile as participants attempt to understand

the wide-ranging implications of COVID-19. During this time, our key priorities

are the welfare and wellbeing of our people, whilst ensuring business

resilience in our critical role as financial market infrastructure, and

continuing to safeguard both our clients' and Euroclear's assets.

In seeking to protect the health and safety of our people, we moved to

wholesale homeworking, with nearly all our people working remotely. We have

taken several other initiatives to support staff wellbeing during this

difficult period.

Our Business Continuity Plan is working well to support our customers' needs

even with the exceptional settlement volumes experienced in the first quarter

across the financial markets. Sustained investment over recent years in new

technologies, cyber security and optimising our ways of working has helped to

minimise operational risk and build a more resilient business, allowing us to

support our customers and our people through this difficult time.

The strong performance in business income at the end of 2019 continued into the

first months of 2020, before the recent heightened volatility, seen across

markets, resulted in much greater activity. As a result, the group delivered

exceptionally strong growth in business income during the first quarter, above

our long-term, through-the-cycle growth trajectory. This activity has recently

begun to normalise, with volumes reverting towards more typical levels. Lower

market valuations are expected to impact our revenue performance in certain

asset classes, such as equities, balancing the overall full year performance.

Central banks lowered policy rates in response to the economic crisis and that

has reduced our interest-related income in the quarter. We expect that an

ongoing lower interest rate environment will continue to substantially impact

Banking and Other Income over the coming quarters, with a yearly decline of

approximately 50% anticipated in 2020, compared to 2019 results.

Capital and dividend

We have a strong balance sheet and capital position. Given our disciplined risk

management, limited leverage and prudent liquidity position, the Board remains

confident in Euroclear's financial strength. However, in light of recent

guidance from the European Central Bank (ECB) and the National Bank of Belgium

(NBB) regarding dividend distribution policy in the context of the COVID-19

crisis, the Board has taken the decision to postpone its approval of the

dividend announced in February, until Q4 2020.

Shareholder liquidity initiative

In December 2019, the Board completed the study phase of the process to find a

liquidity solution for the benefit of all of our shareholders. Given the

current uncertain environment, the Board has decided to stop all work on a

tentative liquidity initiative, and wait until economic activity and market

stability has been restored in a sustained way to consider the matter again.

Commenting on the first quarter update, Marc Antoine Autheman, Chairman said:

"The Euroclear group continues to demonstrate exceptional levels of robustness

and resilience as we support global financial markets during a period of great

strain. On behalf of the Board, I would like to express gratitude to our people

from across every entity of the group for how they have responded to the

COVID-19 crisis. Thanks to their dedication we have been able to maintain

services of the highest quality and security to all clients."

Lieve Mostrey, Chief Executive Officer, added:

"This year has already proven to be challenging for the financial markets, with

recent events demonstrating the need for a strong and adaptable market

infrastructure. Our business, people and systems have shown resilience, and

their proven robustness, to support the financial market ecosystem in these

unprecedented times. Thanks to all our staff's efforts, we remain focused on

delivering for our stakeholders while monitoring the COVID-19 situation very

closely.

In recognition of the important responsibility we have to society and our local

communities, we have made a donation of EUR 1 million to charities that are

tackling the COVID-19 crisis. The donation will be allocated to local

charitable causes, such as hospitals and vaccination research, in each of the

main countries where Euroclear operates."

Disclaimer

The information, statements and opinions expressed herein (the "Content") do

not constitute and shall not be deemed to constitute: (i) any offer, invitation

or inducement to sell a security or engage in investment, financial or other

similar activity; or (ii) a solicitation of an offer to buy any security; or

(iii) any recommendation or advice in relation to any investment, financial or

other decision. Persons considering making any investment or financial decision

should contact their qualified financial adviser. The financial information

included is unaudited and the Content includes forward looking statements in

relation to future events and financial performance which contain inherent

risks and uncertainties. Actual outcomes may differ materially from those

expressed or implied by such forward looking statements.

To the maximum extent permitted by law, no warranty or representation

including, but not limited to, accuracy or completeness (express or implied) is

made in relation to the Content, including, but not limited to, any statements

about the prospects of Euroclear. Euroclear makes no commitment to update the

Content and expressly disclaims, to the extent lawful, liability for any errors

or omissions in it. The Content is not directed at, or intended for

distribution to, or use by any person or entity where such distribution or use

is restricted by law or regulation. Persons into whose possession the Content

comes should inform themselves about and observe any such restrictions.

Note to editors

Euroclear group is the financial industry's trusted provider of post trade

services. At the core, the group provides settlement, safe-keeping and

servicing of domestic and cross-border securities for bonds, equities and

derivatives to investment funds. Euroclear is a proven, resilient capital

market infrastructure committed to delivering risk-mitigation, automation and

efficiency at scale for its global client franchise.

The Euroclear group includes Euroclear Bank - which is rated AA+ by Fitch

Ratings and AA by Standard & Poor's - as well as Euroclear Belgium, Euroclear

Finland, Euroclear France, Euroclear Nederland, Euroclear Sweden and Euroclear

UK & Ireland. The Euroclear group settled the equivalent of EUR 837 trillion in

securities transactions in 2019, representing 239 million domestic and

cross-border transactions and held an average of EUR 30.1 trillion in assets

for clients.

For more information about Euroclear, please visit www.euroclear.com.

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Source: Euroclear Holding