LLB, Liechtenstein's oldest bank, increased its profit by 20 percent last year as it managed to reduce costs. It plans to hire about 20 client advisers this year and will introduce video identification for online account openings.
LLB Group increased its profit to 86.3 million Swiss francs from 72.1 million a year earlier, the company said in a statement today. The bank profited from a rigorous cost-saving program, which meant that operating expenses declined by 9.2 percent on a comparable basis – discounting the divested swisspartners Group.
Operating income rose 2.5 percent to 313.2 million francs on a comparable basis. The decision by the Swiss central bank (Liechtenstein is using Switzerland's currency) to do away with the Euro peg had a negative impact on interest income. Net interest income dropped 3 percent to 132.5 million due to higher interest rate hedging costs.
LLB Achieves Cost-Cutting Target
Net trading income in 2015 amounted to 33.1 million, which compares with a loss of 24 million a year earlier. Net income from financial instruments had an opposite development, with a loss of 0.7 million, compared with a profit of 36.3 million in 2014.
LLB said it achieved the objective of reducing costs as part of the 'Focus2015' strategy. The cost-income ratio declined to 70 percent from 78 percent a year earlier.
Assets Under Management Decline
Assets under management at LLB amounted to 45.6 billion francs at the end of 2015, down from 50.2 billion a year earlier. The decline is attributable to the sale of swisspartners Group (–3.3 billion) as well as currency effects to the tune of –1 billion francs. LLB also had a net new money outflow of 206 million francs, which compares with an outflow of 350 million a year earlier.
The bank, which is majority-owned by the Principality of Liechtenstein, proposes to increase the dividend to 1.60 francs per share from 1.50 francs in 2014. Liechtenstein will receive a total contribution of 31.7 million from the bank through the dividend, direct taxes and compensation for the state guarantee.
Digital Banking
LLB earlier this month said it will introduce video identification for customers who want to open an account online, streamlining the procedure. LLB will be the first bank in Switzerland and Liechtenstein to introduce the procedure, which in other European countries has been the standard for quite some time.
Having completed its 'Focus2015' strategy, LLB now wants to put its emphasis on growth. For that purpose, it plans to hire some 20 client advisers this year, both in the domestic markets and in growth markets abroad.
