Liechtenstein Banking Sector 2025: Record Growth Analysis

The “Ländle” Delivers Exceptional Performance in a Challenging Year

The first half of 2025 has proven to be a standout period for Liechtenstein’s banking sector, with the principality’s financial institutions demonstrating remarkable resilience and growth amid global uncertainties. While Swiss banks faced mixed results during the reporting season, the Alpine nation’s financial center has emerged as a beacon of stability and profitability in the wealth management industry.

Market Leaders Drive Unprecedented Growth

LGT Group: The Fürstenbank’s Strategic Triumph

LGT Group, the world’s largest private banking and asset management group owned by a princely family, delivered exceptional results in the first half of 2025. The institution’s group profit surged by an impressive 38% to CHF 240.6 million, significantly outpacing industry benchmarks. This remarkable performance was driven by a 10% increase in total operating income to CHF 1.42 billion, while the bank maintained strict cost discipline.^[1]^[2]^[3]

The bank’s success stems from robust service income growth, reflecting heightened client activity across its international network. Despite a 17% decline in net interest income due to changing rate environments, LGT compensated with a 35% increase in trading activities and other operating income, primarily driven by foreign exchange transactions.^[2]^[1]

LGT’s asset management capabilities remained strong, with CHF 5.9 billion in net asset inflows during the first half, representing an annualized growth rate of 3.2%. Total assets under management reached CHF 359.6 billion as of June 30, 2025, despite a 2% decline caused by negative currency effects, particularly against the US dollar.^[1]^[2]

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VP Bank: A Remarkable Turnaround Story

Perhaps the most impressive transformation belongs to VP Bank, the principality’s third-largest banking institution. Under the leadership of CEO Urs Monstein, who joined in November 2024, the bank achieved a dramatic turnaround with group net income increasing by 150.2% to CHF 28.8 million. This performance represents a complete reversal from the previous year’s struggles, when the bank grappled with Russian business exposure and operational challenges.^[4]^[5]

The turnaround was underpinned by significant net new money inflows of CHF 2.1 billion, representing an annualized growth rate of 8.3%. Client assets under management grew 2.2% to CHF 51.9 billion, demonstrating renewed client confidence in the institution’s strategic direction.^[5]^[4]

VP Bank’s transformation included comprehensive cost-cutting measures implemented in 2024, resulting in an improved cost-income ratio of 81.5% compared to 91.5% in the previous year period. The bank’s focus on strategic markets including Vaduz, Zurich, Luxembourg, Singapore, and the Virgin Islands has proven successful in driving sustainable growth.^[6]^[7]

LLB Group: Consistency and Milestone Achievement

Liechtensteinische Landesbank (LLB) maintained its position as a pillar of stability, generating CHF 91.0 million in net profit for the first half of 2025, matching the previous year’s performance. More significantly, the bank achieved a historic milestone by surpassing CHF 100 billion in client assets under management for the first time in its history.^[8]^[9]

The bank’s business volume expanded to a record CHF 117.2 billion, with organic and acquisition-driven growth totaling CHF 4.4 billion. Net new money inflows of CHF 1.4 billion contributed to this growth, with both market divisions participating in the expansion. The bank’s cost-income ratio remained within its strategic target range at 65.7%, while maintaining a robust Tier 1 capital ratio of 18.4%.^[8]

Kaiser Partner: The Rising Star

The success story extends beyond the major institutions to smaller players like Kaiser Partner Privatbank, which is steadily approaching the CHF 10 billion milestone in assets under management. The bank achieved remarkable results with assets growing 4.7% to CHF 8.6 billion, driven by impressive net new money inflows of CHF 653.3 million.^[10]^[11]

Kaiser Partner’s financial performance was particularly noteworthy, with gross income advancing 15.7% to CHF 29.4 million and net profit jumping 56.6% to CHF 5.8 million. Most striking was the 62.5% increase in interest income to CHF 6.6 million, achieved despite industry-wide margin pressures from declining interest rates.^[11]^[10]

Smaller Banks Navigate Mixed Results

Neue Bank: Solid Performance with Strategic Investment

Neue Bank demonstrated steady performance with operating income increasing 2.4% to CHF 17.5 million in the first half of 2025. The main driver was a 38.1% surge in financial transaction results to CHF 4.1 million, while commission and service income remained stable at CHF 8.3 million.^[12]

However, the lower interest rate environment pushed net interest income down 11% to CHF 5.1 million. Despite this headwind, the bank maintained solid capitalization with a Tier 1 ratio of 28.0% and a leverage ratio of 10.0%, representing the strongest capital base among all Liechtenstein banks.^[12]

Client assets under management totaled CHF 6.42 billion at the end of June, representing a 3.7% decline compared to year-end 2024. Net new money inflows were modest at CHF 7.4 million, but the bank’s new CEO Roman Pfranger, appointed in spring 2025, has announced plans for increased growth investments with effects expected in the second half.^[12]

Bendura Bank: Boutique Excellence Under HORIZON Strategy

Bendura Bank AG successfully concluded the first half of 2025 with a net profit of CHF 5.7 million, representing a positive result compared to the prior year. The Gamprin-Bendern-based boutique private bank managed to slightly increase its gross profit by reducing operating expenses by 3% to CHF 18.0 million.^[13]^[14]

Under CEO Philipp Forster, who has led the bank since 2024, Bendura is implementing its HORIZON strategy focused on sustainable growth, entrepreneurial thinking, and targeted future investments. The bank positions itself as a specialist rather than pursuing size, aiming to remain the premier destination for international entrepreneurs, wealthy private individuals, family offices, and next-generation business families.^[13]

A key pillar of the HORIZON strategy is systematic digitalization, with targeted investments in modern technologies and digital processes to strengthen competitiveness sustainably. The bank expanded its international presence with a Hong Kong representation office in 2018 and added Bendura Wealth Management (Hong Kong) Ltd. and Bendura Service GmbH in Vienna by end-2023.^[13]

Bank Frick: Strategic Investments Amid Market Headwinds

Bank Frick faced challenging conditions in the first half of 2025, posting a net profit of CHF 4.5 million, representing an 18% decrease compared to the same period last year. The Balzers-based institution cited geopolitical tensions, US dollar weakness, and declining interest rates as key challenges.^[15]^[16]

Despite headwinds, trading business grew 13% to CHF 16.9 million, while commission and services income remained stable at CHF 9.2 million. Net interest income declined 3.5% to CHF 20.2 million, as expected given interest rate cuts.^[16]^[15]

Client assets under management stood at CHF 5.03 billion as of mid-year, down 11% from year-end 2024’s CHF 5.6 billion. Net money outflows totaled CHF 284 million in the first half, which the bank characterized as normal market dynamics in a competitive environment.^[15]

Chairman Mario Frick emphasized strategic investments in IT infrastructure and personnel as key elements for achieving growth objectives, stating: “We anticipate substantial growth in the coming years. Our investments are paying off and ensure product leadership in areas critical to us”. The bank maintains its full-year net profit guidance of CHF 9 million.^[15]

Net profit performance of major Liechtenstein banks in the first half of 2025

The Liechtenstein banking sector demonstrates significant concentration, with the top three institutions controlling the vast majority of assets under management. The market dynamics reveal a clear hierarchy of institutions serving different client segments and geographic markets.

Market share distribution of Liechtenstein banks by assets under management in H1 2025

Strategic Advantages Driving Success

The Security Premium in a Post-Credit Suisse World

The collapse of Credit Suisse in March 2023 fundamentally altered the competitive landscape for European private banking. This crisis highlighted the importance of capital strength and institutional stability, areas where Liechtenstein banks excel. With an average Tier 1 capital ratio exceeding 21%, Liechtenstein institutions are among the world’s best-capitalized banks.^[17]^[18]^[19]

This capital strength, combined with the principality’s AAA sovereign rating from Standard & Poor’s, provides a compelling safety narrative for wealth management clients. The “security premium” has become increasingly valuable as investors seek stable jurisdictions following the upheaval in Swiss banking.^[18]^[20]^[21]

EEA Membership: The Gateway Advantage

Liechtenstein’s membership in the European Economic Area (EEA) since 1995 provides its banks with unrestricted access to the European Single Market of nearly 500 million people. This passporting privilege allows Liechtenstein institutions to operate across all EU and EEA countries without additional licensing requirements.^[22]^[23]^[24]

As the principality celebrated 30 years of EEA membership in May 2025, the strategic value of this relationship has never been clearer. The regulatory framework alignment with EU standards enhances the international credibility of Liechtenstein’s financial institutions while maintaining the operational flexibility that smaller jurisdictions can offer.^[25]^[26]^[27]^[22]

Swiss Franc Stability and Swiss Market Access

The customs and currency union with Switzerland, established in 1923, provides additional strategic advantages. The adoption of the stable Swiss franc as official currency and integration into Swiss payment systems (SIC) gives Liechtenstein banks privileged access to the Swiss economic area.^[19]^[22]

This dual access – to both European and Swiss markets – creates unique opportunities for wealth management and cross-border financial services that few other jurisdictions can match.^[22]^[19]

Innovation and Sustainability Focus

Digital Transformation and AI Integration

Liechtenstein’s financial institutions are not merely benefiting from traditional strengths but are actively investing in future capabilities. LGT Group, for instance, is making targeted investments in digitalization and artificial intelligence to deliver new products and services while enhancing internal efficiency.^[3]^[28]

The banking sector’s Roadmap 2025 strategy emphasizes “Growth through sustainability and innovation,” with specific focus areas including digital services development and responsive business model adaptation. This forward-looking approach positions Liechtenstein banks to compete effectively with larger international competitors.^[29]^[30]

ESG Leadership and Sustainable Finance

The principality has emerged as a leader in sustainable finance and philanthropy. Liechtenstein was named the No. 1 philanthropy location in 2022 by the Global Philanthropy Environment Index. The country’s commitment to environmental responsibility is evident in its status as the world’s first “energy country,” with all municipalities awarded the “Energy City” label.^[21]

This sustainability focus resonates with the evolving preferences of high-net-worth individuals and institutional clients, providing Liechtenstein banks with a competitive advantage in ESG-focused wealth management.^[30]

Comprehensive Performance Overview

The following comprehensive analysis presents the complete financial performance data for all major Liechtenstein banking institutions in the first half of 2025:

Bank	Net Profit H1 2025 (CHF Million)	Change vs H1 2024 (%)	Assets Under Management (CHF Billion)	AuM Change (%)	Net New Money (CHF Million)	Cost-Income Ratio (%)	Tier 1 Capital Ratio (%)
LGT Group	240.6	+38.0	359.6	-2.0	5,900	Not disclosed	Not disclosed
LLB Group	91.0	+0.9	100.9	Record high	1,400	65.7	18.4
VP Bank	28.8	+150.2	51.9	+2.2	2,100	81.5	Not disclosed
Kaiser Partner	5.8	+56.6	8.6	+4.7	653.3	Not disclosed	Not disclosed
Neue Bank	3.5	-5.7	6.42	-3.7	7.4	75.2	28.0
Bendura Bank	5.7	Positive vs prior year	Not disclosed	Not disclosed	Not disclosed	Not disclosed	Not disclosed
Bank Frick	4.5	-18.0	5.03	-11.0	-284	Not disclosed	Not disclosed

Regulatory Excellence and International Recognition

World-Class Supervisory Framework

The Liechtenstein Financial Market Authority (FMA) operates within a robust regulatory ecosystem that combines EU-compliant standards with proportionate implementation. As a non-voting member of all three European Supervisory Authorities (EBA, ESMA, EIOPA), the FMA maintains close integration with European financial supervision structures.^[24]^[27]

The authority’s international recognition extends globally through memberships in IOSCO, IAIS, and other key supervisory bodies. This multilateral engagement ensures that Liechtenstein’s regulatory framework remains current with international best practices while maintaining the agility needed for a specialized financial center.^[24]

Anti-Money Laundering Excellence

Liechtenstein has implemented stringent AML/CFT measures that comply with FATF recommendations and EU directives. The risk-based approach required under the Due Diligence Act ensures banks maintain appropriate controls while facilitating legitimate business.^[27]

The upcoming implementation of the Sixth Anti-Money Laundering Directive (AMLD VI) and the establishment of the European Anti-Money Laundering Authority (AMLA) in July 2025 will further strengthen the regulatory framework.^[27]

Economic Impact and Employment Growth

The financial sector’s success translates directly into economic benefits for Liechtenstein. The industry contributes 21% to the principality’s GDP and employs 16% of the workforce. In 2023 alone, more than 170 full-time positions were created in banking, bringing total employment to 2,621 people in full-time equivalents.^[31]

This employment growth occurs in a jurisdiction where the number of jobs (42,000) actually exceeds the population (40,000), demonstrating the international attractiveness of Liechtenstein as a business location.^[32]

Market Outlook and Growth Prospects

Geopolitical Tailwinds

The current geopolitical environment, characterized by uncertainty in traditional financial centers, creates opportunities for Liechtenstein’s stable and neutral jurisdiction. The principality’s political system, combining democratic parliamentary elements with constitutional monarchy, ensures policy continuity and consensus-building.^[32]^[33]

This stability becomes increasingly valuable as wealth managers and their clients seek jurisdictions that can provide long-term security and predictable regulatory environments.^[33]

Digital Innovation Pipeline

The government’s establishment of the Office for Financial Market Innovation and Digitalisation demonstrates institutional commitment to technological advancement. This proactive approach to fintech and digital assets positions Liechtenstein to capture emerging opportunities in cryptocurrency, digital securities, and blockchain-based financial services.^[21]

Expansion into New Markets

LGT Group’s strategic expansion into markets including Australia, Germany, India, Japan, and Thailand indicates the growth potential for Liechtenstein institutions. The combination of strong capital positions, regulatory flexibility, and international market access creates opportunities for continued expansion.^[3]

Challenges and Risk Management

Market Concentration Risks

While the success of major institutions is encouraging, the concentration of over 90% of banking sector assets in three institutions (LGT, LLB, VP Bank) creates potential systemic risks. Diversification efforts by smaller players like Kaiser Partner, Neue Bank, Bendura Bank, and Bank Frick help mitigate this concentration, but continued growth across all institution sizes remains important.

Currency and Market Volatility

The 2% decline in LGT’s assets under management due to US dollar weakness demonstrates the sector’s exposure to currency fluctuations. Given the international nature of client bases, effective currency hedging and diversification strategies remain crucial for sustained performance.^[1]

Regulatory Compliance Costs

The increasing complexity of international regulation, particularly in AML/CFT and tax transparency, creates ongoing compliance costs. Smaller institutions may face particular challenges in absorbing these costs while maintaining competitiveness.^[27]

Conclusion: Premier Access Through Easy Global Banking

Liechtenstein’s banking sector success in 2025 demonstrates that strategic positioning, operational excellence, and regulatory sophistication create outsized opportunities in global wealth management. The combination of political stability, dual market access, strong capitalization, and regulatory excellence positions the principality as a premier destination for discerning investors.

For high-net-worth individuals seeking access to this exceptional banking ecosystem, Easy Global Banking serves as the premier platform connecting clients with Liechtenstein’s leading financial institutions. The platform’s specialized expertise in navigating complex regulatory requirements and streamlined account opening processes makes the principality’s world-class banking relationships accessible to international clients seeking security, stability, and sophisticated wealth management solutions.

Liechtenstein Banking Sector: The Alpine Principality’s Financial Renaissance in 2025

Market Leaders Drive Unprecedented Growth

LGT Group: The Fürstenbank’s Strategic Triumph