Bank Frick raises equity by 9% in the 2016 financial year
The Liechtenstein Bank Frick concludes the challenging 2016 financial year successfully. Profit amounts to CHF 3.2 million (previous year: 1.8 million). Income from normal business activities of CHF 10 million is driven by one-off income from the Payment Services strategic business unit. Of this amount, CHF 7 million has been allocated to provisions. The Bank’s own equity capable of being offset now amounts to CHF 85 million (+9%). Bank Frick’s Tier 1 ratio is 22.8%.
Balzers (LI) – Family-run Bank Frick strengthened its digital and payment strategy in 2016 and entered into comprehensive partnerships with the payment service provider Masterpayment AG and its parent company Net 1 UEPS Technologies, Inc. (Net1). Bank Frick is a strategic bank partner and payment processor of Net1, an internationally active provider of alternative payment systems.
Bank Frick sold its subsidiary Masterpayment AG to Net1 in the first half of 2016. The sale of Masterpayment AG and of the Bank’s own shares in Visa Europe led to one-off income in the amount of CHF 8.9 million.
In January 2017, Net1 and Bank Frick announced that Net1 would acquire 30% of the shares in Bank Frick in order to solidify the strategic partnership. The transaction has still to be approved by the Liechtenstein Financial Market Authority.
Know-how for digital strategy
As part of its digital strategy, Bank Frick developed comprehensive fintech know-how in the areas of cryptocurrencies and wallets in the year under review. “This know-how will flow into new digital products from Bank Frick,” as CEO Edi Wögerer explains.
Bank Frick manages CHF 2.5 billion in client assets. The balance sheet total amounts to CHF 1.1 billion.
Earnings from commission and service operations were CHF 7.2 million in the past financial year (previous year: 13.4 million). Earnings from the credit business rose to CHF 1.1 million (0.4 million). Earnings from the securities and investment business also increased to CHF 8.1 million (7.2 million).
Bank Frick was able to reduce commission expenses to CHF 8.9 million (11.1 million).
Profit from trading transactions amounted to CHF 3 million (2.4 million) in the 2016 financial year. A large portion of the profit is due to currency transactions that were made by clients on account of the exchange-rate fluctuations during the financial year.
“With regard to the Net1 expansion plans, we expect substantial new business in the area of payment processing and acquiring, among others, in solutions for mobile payment in Europe,” says Edi Wögerer.
Investments in staff and technology
General administrative expenses rose to CHF 18.1 million (13.2 million) in the reporting period. “We have made long-term investments in qualified employees who are responsible for implementing the growth strategy in the areas of institutional clients and payment services. We have also invested heavily in forward-looking systems,” says Edi Wögerer. Staff costs were CHF 9.3 million (7.5 million): operating expenditure stood at CHF 8.7 million (5.7 million).
The increase in the capital base to CHF 85 million – and thus a higher Tier 1 ratio of 22.8% – will allow Bank Frick to expand lending operations as part of the strategy; here, the focus will be on advancing the working capital financing business.
Bank Frick does not view the various regulatory challenges and changes it faces merely as an additional burden: “For our Bank – with its efficient, binding decision-making structures – the changing regulatory environment also offers various new business opportunities,” says Bank Frick CEO Edi Wögerer in conclusion.
About Bank Frick
Bank Frick is a family-run Liechtenstein bank with headquarters in Balzers. It was founded in 1998 by Kuno Frick Sr and is currently wholly controlled by the Kuno Frick Family Foundation.
The Bank focuses on private clients, business clients and fund clients, who are supported by specialised departments at Bank Frick.
Bank Frick is the only bank in Liechtenstein with acquiring licences from Visa and MasterCard.
Bank Frick develops tailor-made funds for qualified market players and acts as a custodian bank.
In 2016, the roughly 70 employees generated a profit of CHF 3.2 million and assets under management in the amount of CHF 2.5 billion. As at the end of December 2016, the balance sheet total was CHF 1.1 billion. The capial base stood at CHF 85 million.
Bank Frick operates a branch in London.
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