LGT posts good results and strong net inflows in 2020

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VADUZ, Liechtenstein, March 15, 2021 / PRNewswire / – LGT, International Private Banking and Asset Management Group owned by the Princely House of Liechtenstein, achieved widespread growth in fiscal year 2020 and generated group profit of 291.5 million francs. Despite the exceptional conditions, LGT recorded strong net asset inflows of 11.6 billion francs (+ 5%). Assets under management increased by 6% to 240.7 billion francs at the end of 2020. LGT is well positioned and confident of continuing its profitable growth in 2021, the year of its centenary.

LGT Logo (PRNewsfoto / LGT)

LGT recorded good results for 2020, underlining the strength of its customer activity. In a market environment impacted at all levels by the coronavirus pandemic, LGT’s main priority was to serve at all times as a reliable partner for its customers. LGT achieved further organic revenue growth thanks to its well-established and broadly diversified international customer base. In October 2020, LGT has completed the last stage of its acquisition of LGT Vestra and has bought back the remaining capital held by the executive partners. LGT Vestra has emerged as one of the UK’s leading wealth managers in recent years, with assets under management of 21.0 billion francs at the end of 2020, against 8.0 billion francs like at the end of june 2016, shortly after the announcement of the acquisition.

LGT Group’s total operating income increased by 2% to reach 1.85 billion francs in 2020, with service revenues also increasing by 2%, to 1.19 billion francs. This was mainly due to higher income from brokerage activities and portfolio management mandates, while performance-based income decreased. Net interest income decreased 19% for CHF 230.7 million due to the negative interest rate environment and the decline in credit volumes. Revenues from trading activities and other operating income increased by 19% to CHF 437.2 million, reflecting higher revenues from clients’ foreign exchange and derivative transactions.

Total operating expenses increased 3% year on year for 1.39 billion francs. An increase in personnel costs of CHF 5% to 1.12 billion francs reflects a slight increase in the workforce and, in particular, the price supplement for 59 million francs in connection with the finalization of the acquisition of LGT Vestra mentioned above. Excluding this exceptional charge, personnel costs remained stable. Business and office spending fell about 5% for CHF 268.6 million, mainly due to lower travel and event expenses, partially offset by higher IT expenses. Total depreciation, amortization and provisions 131.2 million francs, compared to 117.2 million francs the previous year, which had seen a recovery of provisions.

The cost / income ratio remained broadly stable at 75.0% at the end of 2020, against 74.1% at the end of 2019. The group’s total income in 2020 amounts to 291.5 million francs, or a decrease of 5% over one year. Excluding the one-off effect of the completion of the LGT Vestra acquisition, profit increased by 14%.

LGT is very well capitalized with a tier 1 capital ratio of 21.9% at the end of 2020, and has a high level of liquidity.

Acceleration of net inflows in the second half of the year

LGT’s strong performance in terms of net new asset generation in previous years continued in 2020. Net asset inflows amounted to 11.6 billion francs in 2020, which corresponds to a growth rate of 5%, following the collection of 13.9 billion francs (+ 7%) in 2019. Net inflows in 2020 significantly accelerated during the second half of the year, following the negative impact of loan repayments on net inflows during the market turmoil of the first half. Net inflows of assets across all regions and from private banking and asset management contributed to this strong result.

Assets under management increased by 6% year on year to reach a record level of 240.7 billion francs, reflecting net inflows of assets, as well as negative currency effects and positive market and investment performance.

Strategy and outlook

LGT’s targeted expansion in recent years has resulted in a strong international presence, both in more mature and growing markets. In Asia, the Bangkok The office has grown well since it opened in 2019 and now has a team of 24 employees. In the European market, LGT signed an agreement with UBS Europe SE in december 2020 to acquire its wealth management activity by Austria, with about 4 billion francs in assets under management and around sixty employees. With this transaction, which should be finalized in the third quarter of 2021, LGT will become the first private bank of Austria, one of its main European markets. LGT also plans to re-establish a local presence in Germany and assess a number of related options. As previously announced, Roland schubert, the current CEO of LGT Bank Ltd., based in Vaduz, will become a new member of the Board of Directors in early 2022. He will be replaced as CEO by Roland matt, who was until recently Group CEO of Liechtensteinische Landesbank, a role he assumed in 2012.

In May 2020, LGT has announced that it will introduce new corporate structures. These will allow LGT’s three business units of private banking, asset management and impact investing to operate as independent companies and to address their markets in a more targeted and flexible manner from early 2022. The implementation of this system is progressing as planned. , and the new management structures came into effect at the beginning of this year with Olivier de Perregaux, Chief Financial Officer of the LGT Group since 2001, now heads LGT Private Banking as CEO, while LGT Capital Partners remains under the leadership of the CEO Roberto Paganoni. As advertised in February 2021, LGT’s direct impact investing activities have been integrated into the new Lightrock unit, led by CEO Pal Erik Sjatil. As a stand-alone company, Lightrock will in the future offer LGT’s private customers and other investors the possibility of co-investing alongside the princely family of Liechtenstein. This underscores LGT’s commitment to global impact investing, a segment in which it has pioneered for over 14 years. As a long-term bank, sustainable investing has for many years been one of its main strategic priorities, which it reaffirmed by becoming a signatory of the United Nations Principles for a Responsible Bank in January 2021.

In 2021, the year of its centenary, LGT is very well positioned both in the market and to create more long-term value for its customers, employees and other stakeholders. LGT is confident to continue to generate profitable growth in 2021, despite a market environment that is expected to remain difficult due to the coronavirus pandemic.

HSH the Prince Max von und zu Liechtenstein, President LGT: “We obtained good results and made considerable strategic progress in 2020, despite the many challenges that arose. Our customers, and the trust they place in us, have played an important role in this, for which I would like to thank them. . I would also like to thank our employees for their steadfast commitment and for consistently embodying LGT’s values ​​such as reliability and long-term focus. Going forward, sustainability will continue to be a priority in our advisory services and investment solutions, and we will continue to be a pioneer in this area in 2021. Last year, we took important steps to strengthen our position in the market through our new organizational structure, and we will continue to consistently implement this structure in 2021. The fact that we are celebrating our centenary this year gives us an additional incentive to further refine LGT’s strengths for the future and to create lasting values ​​for our customers, the economy and society. “

LGT in brief

LGT is a leading international private banking and asset management group fully controlled by the Princely Family of Liechtenstein for over 90 years. Like a December 31, 2020, LGT managed the assets of 240 CHF.7 billions ($ 272.4 billion) for high net worth individuals and institutional clients. LGT employs more than 3,800 people who work at more than 20 sites in Europe, Asia, the Americas and Middle East. www.lgt.com

Key figures according to 31.12.2020

31.12.2020

12/31/2019

Switch
(in %)

Consolidated income statement (in millions of CHF)

Net interest income and credit losses

230.7

286.1

-19.4

Service revenues

1,185.2

1,163.4

1.9

Income from trading activities and
Other exploitation products

437.2

368.2

18.7

Total of exploitation products

1 853.1

1,817.7

2.0

Personal expenses*

1120.8

1064.8

5.3

Business and office expenses

268.6

281.9

-4.7

Total operating expenses

1,389.4

1346.7

3.2

Depreciation, amortization and provisions

131.2

117.2

12.0

Taxation and minority interests

41.0

45.7

-10.4

Group benefit

291.5

308.1

-5.4

Assets under management (in CHF billion)

240.7

227.9

5.6

Net inflow of assets (in CHF billion)

11.6

13.9

Total assets (in CHF billion)

49.9

49.4

0.9

Group equity (in millions of CHF)

4 837

4,619

4.7

Ratios (in%)

Expense / income ratio

75.0%

74.1%

Tier 1 ratio

21.9%

19.9%

Liquidity coverage ratio

221.6%

218.3%

Effective

3,838

3,662

4.8

Evaluation Moody’s / Standard & Poor’s for LGT Bank Ltd.

Aa2 / A +

Aa2 / A +

* Includes a one-time charge of 59 million francs resulting from the earn-out in connection with the completion of the acquisition of LGT Vestra.

Final audit: April 22, 2021

SOURCE LGT


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