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Liechtenstein Private Bank's Profits Surge, Presses On With Restructuring
Tom Burroughes
22 March 2013
Liechtensteinische Landesbank, the private bank based in the
tiny European principality, said its net profit in 2012 surged to SFr97.9
million ($103.5 million) from SFr15.4 million a year before - a 535.5 per
cent increase - while operating income rose 20.5 per cent to SFr408.9 million. LLB has been restructuring its business lines with its “Focus2015”
strategy. “It is focusing on clearly defined client segments and markets and
reducing complexity and costs, thereby increasing profitability,” the bank said
in a statement today. "With the Focus2015 strategy, we are creating the basis
for the sustained success and future-oriented development of the LLB Group.
Over the next three years, we will consistently focus our financial and
personnel resources on clearly defined client segments and markets with
potential, in which the LLB Group can already demonstrate a solid
position," group chief executive Roland Matt said. The firm said the number of staff will drop to 840 full time
roles; restructuring costs are expected to be around SFr7 million. By the end
of 2015, LLB said it wants to achieve a cost/income ratio – currently 61.7 per
cent – of less than 60 per cent; a Tier 1 capital ratio, under Basel rules, of
more than 16 per cent, and a cumulative business result between 2013 and 2015
of more than SFr300 million. Assets Assets under management rose by 3.7 per cent year-on-year to
SFr49.9 billion, driven by positive market conditions. There was a net money
outflow of SFr392 million. Net interest income fell by 4.5 per cent to SFr181.2
million, and net fee and commission income dropped 2.6 per cent to SFr203.5
million. Personnel expenses fell by 11.2 per cent to SFr160.8
million. Administrative expenses fell by 1.4 per cent to SFr102.7 million. The Focus2015 strategy has involved the following moves:
Closure of LLB (Switzerland),
sale of Jura Trust, adjustment of the network of branch offices, intensified
sales and marketing activities in growth markets, and expansion of fund services. The cost/income ratio fell to 61.7 per cent last year,
against 75.9 per cent in 2011, LLB said.