Compliance Regulations Banking Industry in Liechtenstein: A Stable and Secure Financial Hub

Liechtenstein’s banking center has established itself as a stable and secure financial hub, thanks to its high innovative capacity contributing significantly to the global economy’s transformation towards sustainability. The country’s banks are renowned for their exceptional capitalization and focus on private banking and wealth management, catering to international clients seeking top-notch financial services.

International Banking Sector

The internationally oriented banking sector plays a vital role in Liechtenstein’s financial center, generating substantial economic benefits. With its cross-generational approach and unique blend of tradition, innovation, quality, and sustainability, the banking center offers discerning clients exceptional financial services. Thanks to Liechtenstein’s membership in the European Economic Area (EEA), banks can provide their full range of services across the entire European single market.

Banking Statistics

• As of December 2023, the assets under management by Liechtenstein’s 11 banks stood at CHF 439 billion.
• CHF 191.1 billion or 43.5% was attributed to banks in Liechtenstein.
• The net inflow of new money recorded by Liechtenstein banks and non-domestic group companies totalled around CHF 30.9 billion (CHF 4.7 billion within Liechtenstein) in 2023.

Banking Industry Performance

• At the end of 2023, the balance sheet total of Liechtenstein’s banks and non-domestic group companies amounted to CHF 102.6 billion (CHF 81.5 billion in Liechtenstein).
• The workforce consisted of 3143 full-time equivalent employees.
• The CET1 capital ratio at the individual bank level was an impressive 21.8% as of December 2023, ensuring financial center stability and security for clients.

Country Risk Assessment

The Banking Industry Country Risk Assessment (BICRA) from Standard & Poor’s also rates Liechtenstein’s banking sector in Group 2, placing it among countries with the lowest risk in the industry. This underscores the country’s commitment to maintaining a secure and stable financial environment.

Regulatory Framework

In line with international standards, Liechtenstein banks fully support government efforts to ensure conformity in tax matters, combat money laundering, terrorist financing, and corruption, and adhere to a zero-tolerance policy. They also promote innovative products and business models that prioritize clients’ sense of responsibility towards society, sustainability, and the environment.

Regulatory Oversight

The banking industry in Liechtenstein is regulated by various laws, with EEA membership ensuring that regulatory requirements are identical for banks from the EU area. The Liechtenstein Financial Market Authority (FMA) oversees the banking sector, guaranteeing compliance with international standards.

By following these regulations and standards, Liechtenstein’s banking industry maintains a stable and secure financial environment, making it an attractive destination for international clients seeking top-notch financial services.