Liechtenstein Private Bank Expects Unchanged Profit, Sets Aside Cash For Legal Case

Tom Burroughes

18 December 2017

expects to chalk up the same net profit for the 2017 financial year as was the case a year ago, when the figure came out at SFr103.9 million ($104.9 million).

The bank, which is headquartered in the tiny European principality of Liechtenstein, said its predictions take account of a deposit of a sum of money at the High Court of Justice in London in connection with a lawsuit involving its subsidiary business, LLB Verwaltung (Switzerland) Ltd. LLB Verwaltung (Switzerland) Ltd used to be called Liechtensteinische Landesbank (Switzerland).

At the start of October this year, the High Court of Justice in London (being the trial court) found that there were wrongdoings by a former employee and that LLB Verwaltung (Switzerland) Ltd is also liable for the wrongdoings and loss caused by the former employee. LLB Verwaltung (Switzerland) Ltd is not liable as a consequence of its own wrongdoings. The judgement is not yet legally binding.

The bank said an appeal over the court’s judgement is being considered.

On the basis of the judgement in the trial and the non-suspensive effect of any appeal, LLB Verwaltung (Switzerland) Ltd deposited an amount of CHF 15.1 million with the court to cover damages, interest, and lawyers' fees of third parties. Under the IFRS accounting rules, these costs must be reported as general and administrative expenses. LLB Verwaltung (Switzerland) Ltd expects that the damage amount will be covered by insurance.

LLB, which is listed on the Swiss stock market, presents its annual results for 2017 on 8 March.