Client Business Liechtenstein
Segment results |
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in CHF 1,000 | 2018 | 2017 | Variance | Variance |
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Total net interest income | 78,876 | 74,227 | 4,649 | 6.3 |
Total net income from commission | 91,261 | 90,612 | 649 | 0.7 |
Income from trading activities | 18,734 | 20,059 | –1,325 | –6.6 |
Income from financial instruments | 0 | 8 | –8 | –100.0 |
Other income | 100 | 0 | 100 | 0.0 |
Total operating income | 188,971 | 184,906 | 4,065 | 2.2 |
Personnel expenses | 34,383 | 35,216 | –833 | –2.4 |
General and administrative expenses | 4,538 | 3,744 | 794 | 21.2 |
Depreciation of property, equipment and intangible assets | 4,838 | 3,430 | 1,408 | 41.0 |
Valuation allowances, provisions and losses | –2,858 | –1,000 | –1,858 | –185.8 |
Services to/from other segments | 41,888 | 39,689 | 2,199 | 5.5 |
Operating expenses | 82,789 | 81,079 | 1,710 | 2.1 |
Segment income before income tax | 106,182 | 103,827 | 2,355 | 2.3 |
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Additional information |
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Operating expenses excluding depreciation and amortisation, valuation | 42.8 | 42.5 |
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Operating expenses excluding valuation allowances, provisions and losses / | 45.3 | 44.4 |
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Client assets under management (in CHF billion) | 25.0 | 26.7 |
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Change in client assets under management | –6.3 | 8.6 |
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Net new money (in CHF billion) | –0.2 | 0.4 |
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Total operating income / average client assets under management (bp)1 | 73.0 | 72.1 |
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Segment result / average client assets under management (bp)1 | 41.0 | 40.5 |
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Cost/income ratio operating income (in %)2 | 42.8 | 42.5 | 0.2 | 0.6 |
Headcount (number of employees) | 197 | 195 | 1.5 | 0.8 |
Headcount (expressed as full-time equivalents) | 183.3 | 183.4 | –0.2 | –0.1 |
- Annualised, average values.
- Operating expenses excluding depreciation and amortisation, valuation allowances, provisions and losses / gross income less other income and income from financial instruments.
Structure
The business segment “Client Business Liechtenstein” encompasses the international private banking business and the business with intermediaries conducted in Liechtenstein as well as the local universal banking and credit-granting businesses. It includes the units of VP Bank Ltd, Vaduz which are in direct client contact. In addition, the Group Investment Center, Group Product Management and VP Fund Solutions (Liechtenstein) AG are allocated to this business segment.
Segment result
At CHF 106.2 million, the pre-tax segment result in 2018 improved by CHF 2.3 million over that of the prior year (CHF 103.8 million). In 2018, operating income could be increased, year-on-year, by CHF 4.1 million (2.2 per cent). This growth results from interest income from clients (6.3 per cent) as well as commission and service income (0.7 per cent). Primarily developments in USD interest rates as well as margin increases in credit-granting activities contributed to this positive result. Operating expenses rose by CHF 1.7 million (2.1 per cent) to CHF 82.8 million (prior year: CHF 81.1 million). This increase results primarily from the caption depreciation and amortisation of property, plant & equipment and intangible assets as well as a higher level of recharges from other segments. In 2018, charges for valuation allowances, provisions and losses, year-on-year, declined by CHF 1.9 million to CHF minus 2.9 million (prior year period: minus CHF 1.0 million) due to the release of valuation allowances no longer required.
Intersegmental recharges in the business segment Client Business Liechtenstein are based upon fixed internal transfer prices. Indirect costs for internal services are reported in the business segment in the caption “services to/from other segment(s)”. With 73.0 basis points, the gross margin could be increased (prior-year: 72.1 basis points). The cost/income ratio improved marginally from 42.5 per cent to 42.8 per cent.
In the financial year, the segment reported a small outflow from client monies amounting to CHF 0.2 billion. New money inflows resulting from market-development activities could not offset money outflows resulting from the regulatory environment and taxation-related issues. Assets under management at 31 December 2018 totalled CHF 25.0 billion (31 December 2017: CHF 26.7 billion). With 183 employees, the headcount could be maintained at a stable level (31 December 2017: 183 employees).