Business division result

Despite difficult business conditions in 2011, the Domestic Market Business Division was able to hold its ground. Loans to customers – especially mortgage loans – climbed to a high level so that, in spite of the low interest rate phase and persisting pressure on margins, an increase in net interest income was attained. Good net new money inflows were reflected in the positive development of fee and commission income. Clients were restrained in their investment behaviour, which impacted on our business result. At the same time, our operating expenses increased, largely as a result of the investments in the new bank branches of Bank Linth, as well as in the introduction of the individual clients segment.

Operating income increased by 12.8 percent to CHF 153.1 million (2010: CHF 135.8 million, 2009: CHF 145.0 million). Operating expenses rose by 5.2 percent to CHF 109.5 million (2010: CHF 104.1 million, 2009: CHF 100.6 million). Profit before tax climbed by 37.8 percent to CHF 43.6 million (2010: CHF 31.7 million, 2009: CHF 44.4 million). The cost/income ratio fell to 71.5 percent (2010: 76.7 %, 2009: 69.4 %). The net new money inflow amounted to CHF 655 million (2010: CHF 1'023 million, 2009: CHF 682 million). Client assets posted an increase of 3.1 percent to CHF 13.8 billion (31 December 2010: CHF 13.3 billion, 31 December 2009: CHF 12.7 billion). The dynamic real estate market in Liechtenstein and the east of Switzerland, our active penetration of the market and our good advisory services to clients prompted mortgage lending volumes to climb to CHF 7.7 billion (31 December 2010: CHF 7.2 billion, 31 December 2009: CHF 6.8 billion).

4-year trend

The continuing erosion of margins has again negated the steady growth in lending volumes and client assets. This means that the LLB Group must constantly invest in system automation and improving the efficiency of business processes. Our market is growing in line with the overall economy.

Development of operating income

2008 – 2011, in CHF thousands

Domestic Market – Development of operating income (bar chart)
Development of profit before tax

2008 – 2011, in CHF thousands

Domestic Market – Development of profit before tax (bar chart)
Development of cost/income ratio

2008 – 2011, in percent

Domestic Market – Development of cost / income ratio (bar chart)

Segment reporting

 

(XLS:)

 

 

 

 

in CHF thousands

2011

2010

+/– %

Net interest income

110'701

95'527

15.9

Net fee and commission income

35'712

34'010

5.0

Net trading income

6'542

7'741

–15.5

Share of net income from investments in associates

190

–1'486

 

Total operating income

153'145

135'792

12.8

Personnel expenses

–53'146

–50'752

4.7

General and administrative expenses

–19'782

–25'239

–21.6

Depreciation and amortisation

–6'463

–6'403

0.9

Value adjustments, provisions and losses

–1'613

–4'836

–66.6

Services from/to segments

–28'504

–16'892

68.7

Total operating expenses

–109'508

–104'122

5.2

Business division profit before tax

43'637

31'670

37.8

Performance figures

(XLS:)

 

 

 

 

2011

2010

Net new money (in CHF millions)

655

1'023

Growth of net new money (in percent)

4.9

8.0

Cost/income ratio (in percent)

71.5

76.7

Additional information

 

(XLS:)

 

 

 

 

in CHF millions

31.12.2011

31.12.2010

+/– %

Assets under management

13'766

13'347

3.1

Employees (full-time equivalents, in positions)

418

384

8.9

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