Liechtenstein - a principality with big aspirations

Liechtenstein is slowly carving a role in the Asian wealth management space, boasting two players who are starting to make waves whilst others have already left the stage

With a total population smaller than a Singapore or Hong Kong residential suburb, Liechtenstein, the tiny European principality, is punching well above its weight in private banking in Asia.

The landlocked microstate is home to two noteworthy players seeking to cash in on the proliferation of personal wealth across Asia.

While major wealth competitors including ANZ from Australia, Societe Generale from France and Barclays Wealth from the UK threw in the private wealth management towel, the Vaduz-based duo are thriving.

Both LGT Bank (LGT) and its smaller Liechtenstein brethren VP Bank have flagged their ambitions to be significant players in the Asian wealth management market. How are their ambitions stacking up?

Originally known as The Liechtenstein Global Trust, LGT Bank is owned by the princely House of Liechtenstein through the Prince of Liechtenstein Foundation and is controlled by its family members.

Under the leadership of chief executive H.S.H. Prince Max von und zu Liechtenstein, LGT Group is now one the largest family-owned private banking and asset management groups in Europe.

A bold move

In April 2017, LGT made an audacious move snapping up the private banking business of Dutch bank ABN AMRO in Hong Kong, Singapore and Dubai.

Singapore-based private bank, Bank of Singapore and the wealth arm of DBS were widely expected to make a play for the Netherlands bank's wealth arms. The financial terms of the transaction were never made public.

The move undoubtedly boosted LGT's Asian credentials, pushing its assets under management in the region (including the Middle East) to around US$50 billion.

The acquired business came with US$20 billion in assets under management as well as more than 200 front office employees.

LGT now sits comfortably around the halfway point in the league table of Asia's top 20 private banks.

Boutique can compete

Its smaller-sized and fellow-country institution VP Bank has also laid out its own ambitions for Asia, ambitions that reflect its smaller scale.

The bank, which celebrated its 10-year anniversary in Singapore in 2018, has made no secret of its ambitions for expanding its Asian footprint.

VP Bank upgraded its Singapore operating status from a merchant bank to a wholesale bank, last year opening access to more products and services for domestic clients, including the ability to do business in Singapore.

VP Bank has hired aggressively over the past two years in Singapore, bulking up its private banking, external asset management and wealth solutions teams.

It has also managed to attract seasoned bankers away from the leading global wealth managers. Its latest recruit, a Swiss wealth management veteran, Reto Marx, joined VP Bank in Singapore as "head of client business" at the end of last month.

The Singapore unit now boasts 70 employees and further additions to the operation are in the pipeline. It has also signalled its intention to acquire in Asia to accelerate its growth plans.

In a recent interview with The Asset, Bruno Morel, CEO of VP Bank in Singapore said that Asia was certainly an area of commercial interest.

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Date

14 Feb 2019

Channel

Europe

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