Segment reporting
Structure
External segment reporting reflects the organisational structure of VP Bank Group and the internal reporting to Management. The latter form the basis for assessing financial performance of the segments and the allocation of resources to the segments.
VP Bank Group consists of the six organisational units “Client Business”, “Investment Solutions”, “Chief Executive Officer”, “Chief Financial Officer”, “Chief Operating Officer” and “General Counsel & Chief Risk Officer”.
For segment-reporting purposes, the organisational unit “Client Business” is divided into two business segments “Client Business Liechtenstein” and “Client Business International”. The unit “Investment Solutions” is managed, for segment-reporting purposes, in “Client Business Liechtenstein” and “Client Business International”. The four organizational units “Chief Executive Officer”, “Chief Financial Officer”, “Chief Operating Officer” and “General Counsel & Chief Risk Officer” are regrouped together, for segment reporting, under the business segment “Corporate Center”.
Revenues and expenditures as well as assets and liabilities are allocated to the business segments based on the responsibilities for the clients and the principle of origination. Insofar as a direct allocation is not possible, the positions in question are reported under the Corporate Center. Furthermore, the Corporate Center includes adjustments made on consolidation.
Business segment reporting 2019 |
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in CHF 1,000 | Client | Client | Corporate | Total |
|---|---|---|---|---|
| Liechtenstein | International |
|
|
Total net interest income1 | 66,111 | 52,928 | –3,938 | 115,101 |
Total net income from commission | 86,751 | 57,443 | –7,028 | 137,166 |
Income from trading activities | 16,840 | 13,947 | 30,198 | 60,985 |
Income from financial instruments | 0 | 171 | 14,100 | 14,271 |
Other income | 300 | 3,252 | –3,300 | 252 |
Total operating income | 170,002 | 127,741 | 30,032 | 327,775 |
Personnel expenses | 34,006 | 62,207 | 69,178 | 165,391 |
General and administrative expenses | 3,895 | 24,695 | 27,708 | 56,298 |
Depreciation of property, equipment and intangible assets | 4,945 | 7,918 | 16,480 | 29,343 |
Credit loss expenses | –603 | –6,150 |
| –6,753 |
Provisions and losses | 309 | 246 |
| 555 |
Services to/from other segments | 43,258 |
| –43,258 | 0 |
Operating expenses | 85,810 | 88,916 | 70,108 | 244,834 |
Earnings before income tax | 84,192 | 38,825 | –40,076 | 82,941 |
Taxes on income |
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| 9,398 |
Group net income |
|
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| 73,543 |
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|
|
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Segment assets (in CHF million) | 4,275 | 5,689 | 3,436 | 13,400 |
Segment liabilities (in CHF million) | 6,742 | 5,046 | 580 | 12,368 |
Client assets under management (in CHF billion)2 | 26.9 | 20.7 | 0.0 | 47.6 |
Net new money (in CHF billion) | –0.6 | 2.9 | 0.0 | 2.3 |
Headcount (number of employees) | 195 | 345 | 403 | 943 |
Headcount (expressed as full-time equivalents) | 179.5 | 326.2 | 368.0 | 873.7 |
- As of 1 January 2019, the new funds transfer pricing was introduced within the Group. With funds transfer pricing, the internal bank recharges between the Treasury department and Client Business segments are determined and computed. Funds transfer pricing is a central instrument to manage market-price and liquidity risks. With funds transfer pricing, refinancing and liquidity costs between Client Business segments and Treasury are recharged at market-oriented prices. This recharging is applied for new business and resubmissions as from 1 January 2019. The result of this change for the year 2019 amounts to CHF -10.1 million for Client Business Liechtenstein, CHF -0.1 million for Client Business International and CHF 10.2 million for the Corporate Center. The prior-year comparatives were not restated as the change for prior periods was impracticable because of the passage of time as well as the lack of an appropriate data base and the cost of assembling this data retrospectively on an individual-transaction basis would be so high that it would bear no relationship to the benefit to be derived therefrom. The introduction of funds transfer pricing has no impact on the consolidated results of VP Bank Group.
- Calculation in accordance with Table P of the Guidelines to the Liechtenstein Banking Ordinance issued by the Government of Liechtenstein (FL-BankO).
Business segment reporting 2018 |
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in CHF 1,000 | Client | Client | Corporate | Total |
|---|---|---|---|---|
| Liechtenstein | International |
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|
Total net interest income | 78,876 | 39,340 | –7,239 | 110,977 |
Total net income from commission | 91,261 | 39,015 | –6,004 | 124,272 |
Income from trading activities | 18,734 | 8,968 | 27,282 | 54,984 |
Income from financial instruments | 0 | 86 | –1,732 | –1,646 |
Other income | 100 | 2,490 | –339 | 2,251 |
Total operating income | 188,971 | 89,899 | 11,968 | 290,838 |
Personnel expenses | 34,383 | 54,313 | 68,988 | 157,684 |
General and administrative expenses | 4,538 | 30,555 | 27,776 | 62,869 |
Depreciation of property, equipment and intangible assets | 4,838 | 3,311 | 16,968 | 25,117 |
Credit loss expenses | –2,992 | –11,314 | 1,647 | –12,659 |
Provisions and losses | 134 | 252 | –1,090 | –704 |
Services to/from other segments | 41,888 |
| –41,888 | 0 |
Operating expenses | 82,789 | 77,117 | 72,401 | 232,307 |
Earnings before income tax | 106,182 | 12,782 | –60,433 | 58,531 |
Taxes on income |
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|
| 3,814 |
Group net income |
|
|
| 54,717 |
|
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|
|
|
Segment assets (in CHF million) | 4,112 | 4,761 | 3,556 | 12,428 |
Segment liabilities (in CHF million) | 6,961 | 4,102 | 384 | 11,447 |
Client assets under management (in CHF billion)1 | 25.0 | 16.5 | 0.0 | 41.5 |
Net new money (in CHF billion) | –0.2 | 3.4 | 0.0 | 3.2 |
Headcount (number of employees) | 197 | 330 | 407 | 933 |
Headcount (expressed as full-time equivalents) | 183.3 | 313.3 | 371.9 | 868.4 |
- Calculation in accordance with Table P of the Guidelines to the Liechtenstein Banking Ordinance issued by the Government of Liechtenstein (FL-BankO).
The recharging of costs and revenues between the business units takes place on the basis of internal transfer prices, actual recharges or on prevailing market conditions. Recharged costs within the segments are subject to an annual review and are amended to reflect new economic conditions, where necessary.