• earnings

Euroclear publishes another quarter of growth in Q1

PRNewswire April 28, 2023

BRUSSELS, April 28, 2023 /PRNewswire/ — Results for the Quarter Ending 31 March 2023


Delivering growth in the first quarter

  • Progress made in delivering Euroclear’s client-centric strategy, with a continued focus on resilience as a global financial market infrastructure
  • Q1 net profit totalled EUR 796 million, including interest earnings on cash balances arising from the application of international sanctions related to Russia
  • Operating income was EUR 1,380 million, an increase of 215%
  • Business income of EUR 409 million (Q1 2022: EUR 405 million) and interest, banking, and other income of EUR 971 million (Q1 2022: EUR 32 million) reflect resilience of diversified business model driven by underlying revenue growth
Cash balances related to sanctions on Russia

Strong underlying financial and business performance

  • Excluding the impact of the Russian sanctions, underlying Q1 net profit increased 95% to EUR 256 million
  • Underlying operating income was EUR 651 million, an increase of 51% year-on-year
  • Underlying business income reached a record EUR 414 million, up 2% year-on-year, with three-year underlying business income CAGR of 9% reflecting the robust growth delivered through volatile financial market conditions
  • On an underlying basis, quarterly interest, banking, and other income increased by 871% to EUR 237 million due to rising interest rates
  • Investment in Euroclear’s strategy, coupled with higher inflation have led to underlying operating expenses increasing to EUR 307 million, up 19% compared to the prior year
  • On an underlying basis, earnings per share rose by 95% to EUR 81.4 per share.

Commenting on the results

Lieve Mostrey, Chief Executive Officer, Euroclear

“We are pleased that Euroclear has delivered another quarter of growth.  Our diversified and robust business model continues to serve our stakeholders well, enabling further investment in our client proposition and business resilience as we implement the group’s growth strategy.”

Financial summary

Euroclear delivered another record financial performance in Q1 2023.

Euroclear Holding

(€ m)

Q1 2023

Russian sanctions impacts

Q1 2023 Underlying

vs 2022

Operating income





51 %

Business income





2 %

Interest, banking & other income





871 %

Operating expenses





-19 %

Operating profit before Impairment





99 %






Pre tax profit





98 %






-107 %

Net profit





95 %




Business income operating margin

22.9 %

25.9 %

EBITDA margin (EBITDA/oper.income)

79.1 %

57.0 %


In total, Q1 2023 net profit increased to EUR 796 million, benefitting from the continued delivery on the group’s strategy and its resilient business model, and the impact of Russian sanctions which contributed materially to the financial results.

Further details on the implications of the Russian sanctions are included in a dedicated section later in the release.

Underlying results

Underlying Q1 operating income rose 51% to a record EUR 651 million.   

Most of the group’s operating income came from products and services that generated fees. Business income improved through the quarter to reach a record EUR 414 million, an increase of 2% year-on-year. 

The Euroclear group’s business model provides a hedge against market volatility. When equity markets are lower, the impact is mitigated by the group’s diversified and subscription-like business model, and we benefit in a similar vein when bond markets are weaker, as approximately three quarters of the group’s business income is decoupled from financial market valuations. Such that, in the recent market environment, when both equity valuations and transaction volumes have been low, any potential impact to us has been mitigated by those operating entities which have a greater relative weighting to the bond markets, which saw business income grow.

Over a three-year period, underlying business income has grown 9% CAGR, reflecting the robust growth delivered by the strategy through volatile financial market conditions.

Since last year, the interest rate environment has changed dramatically. This has resulted in a large increase in interest earnings due to rising interest rates on cash balances. On an underlying basis, Q1 2023 interest, banking and other income increased by 871% to EUR 237 million because of rising interest rates.

Euroclear is investing in its strategy, leading to underlying operating expenses increasing to EUR 307 million, up 19% compared to the prior year.

Approximately 10% of the increase in underlying operating expenses is due to inflation on costs, with the remainder reflecting continued investments in its technology and service offering, as well as one-off projects. The investments in Euroclear’s technology aim at enhancing Euroclear’s client proposition, business resilience, and to increase efficiency through standardisation and modernisation. 

Euroclear continues to expect expenditure to remain above its ‘through-the-cycle’ target of 4-6% p.a. throughout 2023, due to accelerating investment in both its strategy and the resilience of the business, coupled with continued inflationary pressures on the cost base. Excluding the impact of inflation and one-off expenditures, Euroclear’s Q1 expense profile is broadly in line with the top end of the through-the-cycle range.

Nevertheless, profitability has continued to rise, as expected, as inflation headwinds have been more than offset by higher net interest income from subsequent rate increases. The group’s underlying EBITDA margin was 57% in the first quarter, a level which is amongst the industry leaders in the financial market infrastructure sector.

On an underlying basis, earnings per share almost doubled, up 95% to EUR 81.4 per share.

The group maintains a strong capital position and a low-risk profile, which are critical as a financial market infrastructure and create headroom for further growth.

Navigating a Challenging Operating Environment while Delivering Euroclear’s Growth Strategy

Following a year in which financial markets experienced negative returns from both equities and fixed income for the first time in over 50 years, activity levels in the first quarter were relatively muted, with low levels of Initial Public Offerings in equity markets and an absence of M&A activity as a driver of capital market operations. Despite this, Euroclear has continued to grow its business income, demonstrating the resilience of its business model and the continued progress in its client-centric strategy.

Fixed income markets improved through the quarter, however equities remained volatile which has impacted the group entities and products, such as funds, where there is higher equity exposure. In addition, the higher interest rate environment has reduced demand for some product lines, such as in tri-party securities lending. 

Euroclear has closely monitored the recent disruption in the banking sector, taking necessary actions to ensure its resilience and support clients where appropriate. The volatility resulted in higher transaction volumes in March at a similar level to last year, following Russia’s invasion of Ukraine.  

In addition, following the market-wide application of sanctions related to Russia, Euroclear continues to comply in its role as financial market infrastructure. See “Implications of Russian sanctions”, below, for more details.

The consequence of the operating environment is shown below in the group’s key operating metrics: 

Q1 2023

Change vs Q1 2022

3-year CAGR

Assets under Custody

EUR 36.4 trillion

-1 %

7.4 %

Number of transactions

80 million

0 %

3.3 %

Turnover (Value of transactions processed)

EUR 275 trillion

+1 %

6.6 %

Fund assets under custody

EUR 2.9 trillion

-4 %

11.1 %

Collateral Highway

EUR 1.7 trillion

-12 %

5.7 %


At the same time, Euroclear has continued to deliver on its five-year growth strategy and strives towards its ambitious long-term vision to build a digital and data-enabled financial market infrastructure.

In line with this vision, Euroclear recently announced a collaboration with Tradeweb and Informa Global Markets to automate the identification and setup process for newly issued Eurobond securities in the primary market. The initiative is expected to reduce cost and risk to the investor community by providing quicker access to reliable deal information.

Consistent with its strategy, Euroclear is now exploring further opportunities as it continues the integration of MFEXbyEuroclear to build a compelling proposition for funds services. This includes services in private markets assets, where Euroclear has announced its intention to acquire Goji, a UK-based FinTech (subject to regulatory approvals).

A further innovation was delivered in the Negotiable European Commercial Paper Market as Euroclear France opened its services to Italian issuers for the first time. By using the service, Unicredit became the first issuer to access the second largest short-term funding market in Europe.

Implications of Russian sanctions

Russia’s invasion of Ukraine resulted in market-wide application of international sanctions, which had a material impact on Euroclear’s financial market infrastructure. Well established processes are in place which have allowed the group to implement the sanctions while maintaining the normal course of business.

There is, however, additional complexity because the package of sanctions is wide-ranging and, moreover, Russia does not recognise the international sanctions and has implemented its own economic countermeasures. Euroclear maintains regular dialogue with clients and other impacted stakeholders in managing the market issues and implications of Russian countermeasures.

The international sanctions and Russian countermeasures resulted in a loss of activities from sanctioned clients and Russian securities which impacted business income. However, it has been more than offset by increased interest income.

The cash on the balance sheet has increased as blocked coupon payments and redemptions accumulate. At the end of March 2023, Euroclear Bank’s balance sheet had increased by EUR 88 billion year-on-year to a total of EUR 140 billion.

As per Euroclear’s standard process, which is the same for any client’s long cash balances, the cash balances arising from the sanctions are invested to minimise credit risk. Over Q1 2023, interest arising on cash balances from Russia-sanctioned assets was EUR 734 million.

Future earnings linked to the sanctions will continue to depend on the prevailing interest rate environment and the evolution of the sanctions. The Board expects interest income to continue to grow as blocked payments and redemptions continue to accumulate, albeit at a slower pace during 2023.

As previously outlined, while the Russian sanctions materially impact the balance sheet, the impact on the group’s capital ratios is not expected to be significant. Euroclear maintains a strong capital position. 

The nature of the activities undertaken as a financial market infrastructure has led various parties to contest the sanctions and countermeasures, as well as their application, with legal proceedings ongoing in both the European Union and Russia. At present these legal proceedings are not presently considered a material risk and have not incurred any financial impact.

Furthermore, Euroclear notes that analysis is being undertaken by the European Commission to consider the potential generation of resources to support Ukraine from reinvestment of immobilised Russian assets.

Since considerable uncertainties persist, the Board considers it necessary to separate the sanction-related earnings from the underlying financial results when assessing the company’s performance and resources.

Euroclear continues to act in a transparent manner with all authorities involved. The Board will continue to act cautiously by not distributing any profits related to the Russian sanctions until the situation becomes clearer.


Euroclear Bank and Euroclear Investments are the two group issuing entities. The summary income statements and financial positions at Q1 2023 for both entities are shown below. 

Q1 2023

Q1 2022


Euroclear Bank Income Statement


Net interest income




Net fee and commission income




Other income




Total operating income




Administrative expenses




Operating profit before impairment and taxation




Result for the period




Euroclear Bank Statement of Financial Position

Shareholders’ equity




Debt securities issued and funds borrowed (incl.subordinated debt)




Total assets




Euroclear Investments Income Statement (BE GAAP)





Net gains/(losses) on financial assets & liabilities




Other income




Total operating income




Administrative expenses




Operating profit before impairment and taxation




Result for the period




Euroclear Investments Statement of Financial Position

Shareholders’ equity




Debt securities issued and funds borrowed




Total assets




Euroclear Investments has been relocated from Luxembourg to Belgium on 31 December 2022 at midnight.

The financial statements are now prepared under Belgian GAAP, and the 2022 have been restated accordingly.


Note to editors

Euroclear group is the financial industry’s trusted provider of post trade services. Guided by its purpose, Euroclear innovates to bring safety, efficiency and connections to financial markets for sustainable economic growth. Euroclear provides settlement and custody of domestic and cross-border securities for bonds, equities and derivatives, and investment funds. As a proven, resilient capital market infrastructure, Euroclear is committed to delivering risk-mitigation, automation, and efficiency at scale for its global client franchise. The Euroclear group comprises Euroclear Bank, the International CSD, as well as Euroclear Belgium, Euroclear Finland, Euroclear France, Euroclear Nederland, Euroclear Sweden, Euroclear UK & International and MFEXbyEuroclear.


"Business as usual" Cash balance
Euroclear Logo


SOURCE Euroclear

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