Acquisition activity boosted assets under management for the Liechtenstein-based group, with profits also rising last year.

Liechtenstein-headquartered LGT, which is buying the private banking arm of ABN AMRO, today reported a group profit of SFr230 million ($227.5 million) in the 2016 financial year, a 9 per cent increase on the previous year.

Net asset inflows totaled SFr11.7 billion, the bank said, noting that the completion of the LGT Vestra acquisition contributed an additional SFr8.0 billion in client assets (LGT purchased a majority stake in UK-based Vestra Wealth in 2016). Assets under management increased 18 per cent to SFr152.1 billion.
 
"The 2016 financial year was characterised by economic and political uncertainties, which was reflected in subdued client activity. Despite this environment, LGT continued on its growth path," LGT said in a statement.

Total operating income increased 5 per cent in 2016 from a year ago to SFr1.2 billion. Net interest and similar income increased to SFr172.3 million thanks to efficient balance sheet management. Income from services rose to SFr823.9 million as a result of the larger asset base. At SFr210.0 million, income from trading activities and other operating income was lower than in 2015, reflecting a one-off contribution from a real estate sale recognised in the previous year’s result.
 
Total operating costs rose by 9 per cent in 2016 to SFr895.4 million. Personnel costs rose 6 per cent to SFr670.5 million, reflecting higher staff levels and performance-related compensation, as well as a positive effect from pension plan adjustments.

The cost-income ratio was 74.2 per cent at the end of 2016, compared to 71.2 per cent at the end of 2015.

The group said it has "consistently" carried out its international growth strategy, buying Vestra Wealth and agreeing to buy the private banking operations of ABN AMRO, which adds to business operations in Asia and the Middle East. The ABN AMRO deal, agreed late last year, is expected to complete in the second quarter of this year, subject to regulatory clearance.

On 3 March, LGT announced that it will acquire the London- and Paris-based private debt manager European Capital Fund Management, including a team of more than 20 specialists. This deal is expected to complete by the second quarter of this year.