LGT achieves very strong net asset inflows and substantial business growth in the first half of 2021
LGT, the international Private Banking and Asset Management Group owned by the Princely House of Liechtenstein, achieved significant growth in the first half of 2021 and delivered group profit of CHF 180.6 million. Assets under management grew 14% to CHF 275.0 billion as at the end of June 2021 on the back of favorable market developments and high levels of client activity. Very high net asset inflows of CHF 14.1 billion (+12% on an annualized basis) and strong investment performance contributed to this result. LGT is confident that it will remain on its sustainable growth path in the second half of 2021.
LGT continued to expand its client business in the first half of 2021, while providing clients with enhanced access to its investment expertise in various asset classes. Favorable market conditions and strong interest in LGT’s sustainable investment solutions contributed to broad-based revenue growth for the group. At the same time, LGT made further investments to strengthen its advisory services and investment processes, and to expand its digital platforms.
Driven by high transaction volumes, an increase in income from the brokerage business and the higher asset base compared with the prior-year period, income from services rose 21% to CHF 692 million. Income from trading activities and other operating income was CHF 159.5 million (down 14%) as foreign currency hedging offset higher revenues from trading activities, especially derivatives trading for clients in Asia. Net interest income was CHF 101.9 million, down 28% compared with the prior-year period, reflecting the persistently low interest rate environment. Overall, total operating income increased 6% to CHF 953.4 million.
LGT continued to make significant investments in the expansion of its business in the first half of 2021. A 17% increase in personnel expenses to CHF 562.6 million reflects organic staff growth as well as higher accruals for long-term performance-based compensation. At CHF 127.7 million, business and office expenses fell 5% compared with the first half of 2020, as travel and marketing costs decreased due to the pandemic, while IT and advisory expenses increased. Overall, total operating expenses rose 12% to CHF 690.2 million.
The cost-income ratio stood at 72.4% as at the end of June 2021, compared with 75.0% as at 31 December 2020 and 68.6% as at 30 June 2020. LGT achieved a group profit of CHF 180.6 million for the first half of 2021, 5% below the excellent result for the prior-year period.
LGT is very well capitalized with the tier 1 capital ratio at 22.8% as at 30 June 2021 compared with 21.9% as at the end of 2020, and has a high level of liquidity.
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