Reports

Net Income, AuM Slips At Liechtenstein Private Bank But Inflows Rise Sharply

Tom Burroughes, Group Editor, London, 6 March 2012

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Client assets and net income at Liechtenstein’s VP Bank declined last year amid difficult markets, but inflows of new money increased significantly.

Client assets and net income at Liechtenstein’s VP Bank declined last year amid difficult markets, with total client assets - including custodial assets - falling to SFr38.9 billion (around $42.6 billion) from SFr40.8 billion in 2010. The bank logged a net income of SFr6.4 million in 2011, down from SFr17.2 million in the previous year.

The cost/income ratio at the bank has deteriorated sharply over the past two years, rising to 79.2 per cent last year from 70.9 per cent in 2010 and 59 per cent in 2009.

There was a SFr1.0 billion inflow of net new money into the bank in 2011, VP Bank said in a statement today, up 10 times from its net inflow of SFr100 million in the previous year. The bank said this demonstrated that its move to a more onshore business model was working.

While VP Bank did not mention it explicitly, the tiny principality of Liechtenstein has been moving to open up its affairs in co-operating with jurisdictions such as the UK via arrangements such as the Liechtenstein Disclosure Facility, aimed at offshore UK taxpayers. 

The bank’s Tier 1 capital ratio, a closely watched barometer of financial strength, stood at 18.2 per cent at the end of last year.

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