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LGT Group

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LGT Group
LGT Group
FormerlyThe Liechtenstein Global Trust
Company typePrivate
IndustryFinancial services
FoundedNovember 22, 1920; 104 years ago (November 22, 1920)
FounderThe Princely House of Liechtenstein
HeadquartersVaduz, Liechtenstein
Number of locations
20+
Area served
  • Europe
  • Americas
  • Asia-Pacific
  • Middle East[1]
Key people
ProductsPrivate Banking, Asset management, Hedge fund and Private equity
RevenueIncreaseSFr 3140 million[1] (2018)
IncreaseSFr 1,675.8 million[1] (2018)
Increase SFr 314.0 million
AUMIncrease SFr 198.2 billion[1][2]
Total assetsSFr 57.3 billion
OwnerPrince of Liechtenstein Foundation
Number of employees
3,405[1] (2018)
Websitewww.lgt.com

LGT Group is the largest royal family-owned private banking and asset management group in the world. LGT, originally known as The Liechtenstein Global Trust, is owned by the princely House of Liechtenstein through the Prince of Liechtenstein Foundation and led by its royal family members H.S.H. Prince Maximilian von und zu Liechtenstein (CEO) and H.S.H. Prince Philipp von und zu Liechtenstein (chairman).[3]

Organization

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LGT is headquartered in Vaduz, Liechtenstein, with a key presence in Zürich, Switzerland. The company maintains 3,405 employees in over 20 offices around the globe, Asia, Australia, Europe, the Middle East and North America.[1]

LGT operates through several divisions:

The company has made several acquisitions of high value transactions. In 2009, it acquired the Swiss operation of Dresdner Bank from Commerzbank,[6] following this in 2015 it acquired more than $12 billion of HSBC Private assets and in 2017 it acquired Dutch giant ABN AMRO Asia Private with $20 billion in assets. The ABN AMRO transaction meant that LGT now had more assets under management in Asia than it did in Europe.

History

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The founding of the bank happened during an economical shift in Europe. The Austrian currency was legal tender in Liechtenstein, but after the collapse of the Austro-Hungarian Empire, its currency plummeted. The Swiss franc was introduced in 1919, and became legal tender in Liechtenstein in 1924 (plans for a national currency were dropped). The Bank of Liechtenstein Aktiengesellschaft (renamed LGT Group in 1996) was founded in 1920 during this reorientation phase, and its first objective was to gather capital in Swiss francs. The Anglo-Austrian Bank was granted the licence to operate the structure, and was the majority stakeholder. Count Karl Trauttmanssdorf was its first chairman. The BIL enabled companies and banks of Liechtenstein to consolidate their holding companies abroad after the Austro-Hungarian debacle, thus orienting the country's banking specialty towards offshore holding assets management, and pulling significant economic traction from this activity. In May 1921, BIL launched its operations with 10 employees based in ground-floor offices inside the main government building. During the global economic crisis in the 1930s, the Princely House of Liechtenstein acquired a controlling interest in the bank. The bank survived World War II thanks to "prudent business practices."[7]

Until the 1960s, the bank’s main focus was to support and provide financing for the expansion of Liechtenstein’s economy and business sector. BIL did so primarily through the provision of financial services and loans. Over time, however, the commercial opportunities available to it in the local economy became too narrow, leading it to grow its operations to become an international commercial bank. Following this transformation, BIL began to expand into various segments of the banking industry, with a particular focus on activities pertaining to mortgages, stock markets and foreign exchange.[7]

Hans-Adam II, Prince of Liechtenstein (born 1945), led the bank on an expansion course until his accession to the throne in 1989, which it has maintained ever since.

In 1970, the bank's share capital was taken over by the recently established Prince of Liechtenstein Foundation.[7] During the 1980s, BIL opened representative offices in Europe, the US and Asia, including in London, which was its first foreign business base, and in Hong Kong in 1986.[8]

In 1986, BIL went public[9] and in 1989, acquired GT Management PLC in London.[10] In 1990, BIL GT Group AG was founded and H.S.H. Prince Philipp became Chairman of the Board of Directors.[11][12] Six years later, BIL GT Group was renamed Liechtenstein Global Trust and BIL became LGT Bank in Liechtenstein AG.[13] In 1998, the GT Asset Management division was sold and the bank went private.[14] It was then that LGT decided to focus on private banking and asset management and to further expand its international operations.[15]

In 2003, LGT acquired Schweizerische Treuhandgesellschaft STG from Swiss Life,[16] opened LGT Bank Deutschland & Co. OHG[17] and was granted a banking license in Singapore.[18] Over the next four years, it launched LGT Bank Switzerland and opened LGT Bank Österreich.[19] In 2006, H.S.H. Prince Maximilian of Liechtenstein became CEO.[20]

LGT Venture Philanthropy, an independent charitable foundation, was founded in 2007,[21] on the initiative of LGT CEO H.S.H. Prince Max von und zu Liechtenstein. In 2009, LGT sold its trust and fiduciary division (LGT Treuhand) to First Advisory Group[22] and acquired the Swiss operation of Dresdner Bank.[23][24] In 2011, it sold LGT Bank Deutschland & Co. OHG.[25] In the years that followed, LGT opened a branch in Salzburg, Austria (2012),[26] as well as LGT Middle East in Dubai (2013).[27]

Between 2012 and 2017, LGT acquired several new portfolios and operations, including Clariden Leu’s ILS boutique (2012),[28] a private banking portfolio from HSBC in Switzerland (2014),[29] a majority stake in London-based wealth management partnership Vestra Wealth (2016),[30] the private banking operations of ABN AMRO Asia in Asia and the Middle East (2016)[31] and European Capital Fund Management (2017).[32]

In 2019, LGT opened a branch in Thailand (LGT Securities Thailand)[33] and also entered the Indian market through the acquisition of a majority stake in Validus Wealth (FDI approval pending).[34] Later that year, the group acquired Aspada, a leading India-focused investment fund which was previously owned by the Soros Economic Development Fund (SEDF) as a sole shareholder, to expand its impact investing platform LGT Lightstone.[35] In December 2021, LGT acquired the Australia-based firm Crestone Wealth Management (former UBS Wealth Management Australia until 2016, approximately AUD$25 billion in assets under management) for $338 millions. The acquisition was completed in 2022.[36]

Controversy

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Main article: 2008 Liechtenstein tax affair

The German tax authorities commenced numerous audits and prosecutions for tax fraud in the tax haven of Liechtenstein, based on information on a compact disc acquired by the German secret service Bundesnachrichtendienst. The CD, containing large amounts of information on accounts held by German citizens and other nationals with the bank, was allegedly obtained for a sum of €4 million from a former employee or contractor of the bank.[37] Information was also forwarded to many other European states and Australia, leading to successful investigations there. For its involvement in the affair, LGT agreed to a settlement with a fine of €50 million.

Rating

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Rating: Standard & Poor's[38] / Moody's[39] (2017)

  • A+ / Aa2

Locations

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Europe

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Other locations

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References

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  1. ^ a b c d e f "Annual Report 2018" (PDF).
  2. ^ "LGT: Bumper Profits in 2017". finews.com. 12 March 2018. Retrieved 4 December 2018.
  3. ^ Bucak, Selin (13 September 2017). "A royal family office: LGT's UK connections". Citywire.
  4. ^ Thompson, Jennifer (2021-05-20). "Liechtenstein royal family backs impact investing". Financial Times. Archived from the original on 2022-12-12. Retrieved 2021-09-28.
  5. ^ Cua, Genevieve (7 August 2018). "An integral piece of the puzzle". The Business Times.
  6. ^ "LGT Buys Swiss Unit of Dresdner From Commerzbank". 27 July 2009. Retrieved 18 April 2019.
  7. ^ a b c Pohl, Manfred (1994). Handbook on the History of European Banks. Edward Elgar Publishing Ltd. ISBN 9781781954218.
  8. ^ "LGT Bank: A Beacon Of Stability". Retrieved 18 April 2019.
  9. ^ P. Christiaan Klieger (2012). The Microstates of Europe: Designer Nations in a Post-Modern World. Lexington Books. ISBN 9780739174272.
  10. ^ United States. Securities and Exchange Commission (1995). SEC Docket. Vol. 59 (9-14 ed.). Securities and Exchange Commission.
  11. ^ "Long-Term Thinking and Actions Are Part of the LGT Identity". 11 May 2018. Retrieved 18 April 2019.
  12. ^ "Das Fürstenhaus von Liechtenstein". fuerstenhaus.li.
  13. ^ Freudenheim, Milt (11 July 1996). "Investment Firms Talk Of Merging". The New York Times. Retrieved 18 April 2019.
  14. ^ "LGT asset management division is up for sale". 7 July 1998. Retrieved 12 November 2019.
  15. ^ "LGT Capital Partners". Retrieved 12 November 2019.
  16. ^ "Liechtenstein's LGT buys Swiss Life's STG". Retrieved 18 April 2019.
  17. ^ "Liechtenstein's LGT Bank sells German unit to ABN Amro". Retrieved 12 November 2019.
  18. ^ "ABN Amro sells its private banking business Hong Kong, Singapore, and Dubai to LGT". 6 December 2016. Retrieved 18 April 2019.
  19. ^ "Interview with Meinhard Platzer, co-CEO of LGT Bank". Retrieved 12 November 2019.
  20. ^ "Max Und Zu Liechtenstein, LGT Group Foundation: Profile and Biography". Bloomberg.com. Retrieved 2021-09-28.
  21. ^ "New fund targets UK social impact". 23 July 2013. Retrieved 12 November 2019.
  22. ^ "Liechtenstein's LGT Group Sells Trust Business". Retrieved 18 April 2019.
  23. ^ "LGT Buys Swiss Unit of Dresdner From Commerzbank". 27 July 2009. Retrieved 18 April 2019.
  24. ^ "Commerzbank sells Dresdner Swiss unit to LGT". Archived from the original on 2022-12-12. Retrieved 18 April 2019.
  25. ^ "LGT Bank appoints new CEO". Retrieved 12 November 2019.
  26. ^ "LGT expands European base with Salzburg opening". Retrieved 12 November 2019.
  27. ^ "LGT opens first private banking office in Dubai". Retrieved 12 November 2019.
  28. ^ "Clariden Leu insurance-linked investment business and ILS funds sold to LGT Group". 13 March 2012. Retrieved 12 November 2019.
  29. ^ "LGT Agrees to Buy Swiss Private Banking Assets From HSBC". Bloomberg News. 24 June 2014. Retrieved 12 November 2019.
  30. ^ "LGT Group snaps up UK's Vestra Wealth". Financial Times. 14 March 2016. Archived from the original on 12 December 2022. Retrieved 12 November 2019.
  31. ^ "Liechtenstein's LGT buys ABN Amro's Asian private banking operations". 6 December 2016. Retrieved 12 November 2019.
  32. ^ "LGT Capital Partners acquires European Capital". June 2017. Retrieved 12 November 2019.
  33. ^ "LGT opens Bangkok office". Retrieved 12 November 2019.
  34. ^ "LGT buys majority stake in Validus". 27 June 2019.
  35. ^ "Beef under fire; proxy power blunted; Soros' royal impact deal". Financial Times. 28 August 2019. Archived from the original on 12 December 2022. Retrieved 12 November 2019.
  36. ^ Shields, Michael; Sahu, Subhranshu (15 December 2021). "Lichtenstein's LGT in $338 mln deal to buy Crestone". Reuters. Retrieved 24 February 2024.
  37. ^ Fury in Liechtenstein over German tax inquiry by Tony Patterson in The Independent, 20 February 2008. Retrieved 31 August 2013. Archived here.
  38. ^ "Standard & Poor's rating report" (PDF). Standard & Poor's. Retrieved 2 November 2018.
  39. ^ "Moody's rating report" (PDF). Moody's. 12 June 2018. Retrieved 2 November 2018.
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