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Liechtenstein Financial Institution Risk Assessment Remains Stable, Says Standard & Poor’s

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Economic Development Assessed as Stable by S&P

The Principality of Liechtenstein’s economic development has been assessed as stable by Standard & Poor’s (S&P), a rating agency that evaluates the financial health and resilience of countries. According to S&P’s latest report, domestic banks in Liechtenstein are expected to remain resilient in the face of global economic uncertainties.

Adaptation to Global Economic Challenges

The agency notes that these challenges will have an impact on Liechtenstein’s export-oriented economy, but the country’s competitive and flexible nature will allow it to adapt quickly. S&P praises Liechtenstein’s legal framework as effective, fair, and predictable, which will enable the country to maintain an orderly development of its laws without sudden changes.

Progress in Anti-Money Laundering and Tax Evasion Prevention

S&P also highlights Liechtenstein’s significant progress in implementing anti-money laundering and tax evasion prevention regulations over the past decade. The country has developed into a transparent financial centre, as confirmed by the latest MONEYVAL report published in June 2022.

Bank Resilience and Confidence

  • Strong or above-average risk-adjusted capital ratios
  • Prioritization of long-term capitalization over short-term shareholder returns
  • High confidence in the domestic banking sector

The reconfirmation of Liechtenstein’s low risk rating and classification in Group 2 of the BICRA underscores the resilience and stability of its local banking centre. In light of the current global uncertainties and ongoing conflict in Ukraine, this achievement cannot be taken for granted.

Strengthening Financial and Banking Centre

The Bankers Association welcomes the government’s decision to start accession negotiations with the International Monetary Fund (IMF) as an important step towards further strengthening Liechtenstein’s good starting position and its financial and banking centre.