Financial Crime World

Liechtenstein’s Financial Sector Complies with International Regulations, Maintains High Capitalization Levels

Liechtenstein’s banking sector has a long history of stability and security, boasting some of the highest capitalization levels in the world. This unique blend of tradition, innovation, and sustainability makes it an attractive destination for international clients seeking high-quality financial services.

Strong Regulatory Framework

According to recent figures, Liechtenstein banks had client assets under management totaling CHF 439 billion as of December 2023. The sector’s net inflow of new money recorded a significant CHF 30.9 billion in 2023, with CHF 4.7 billion of this amount coming from within the country.

  • Balance sheet total: CHF 102.6 billion (as of year-end 2023)
  • Number of full-time equivalent employees at Liechtenstein-based banks: 3143
  • CET1 capital ratio at the individual bank level: 21.8% (by the end of 2023)

This high degree of capitalization has been recognized by international rating agencies, with Standard & Poor’s assigning Liechtenstein a Group 2 rating in its Banking Industry Country Risk Assessment (BICRA). This designation places Liechtenstein among the countries with the lowest risk in the banking sector.

Commitment to Sustainability

In addition to regulatory compliance, Liechtenstein’s financial institutions have been praised for their commitment to promoting sustainable business practices and cutting-edge products that take account of clients’ sense of responsibility towards society, sustainability, and the environment. The country’s banks are fully supportive of government efforts to combat money laundering, terrorist financing, and corruption, and maintain a zero-tolerance policy in these areas.

  • Regulatory compliance: Liechtenstein’s banking sector is regulated by a series of laws, with the Liechtenstein Financial Market Authority (FMA) responsible for overseeing the industry.
  • Membership in European Economic Area (EEA): Liechtenstein banks are subject to the same regulatory requirements as those from the EU area, ensuring a high degree of consistency and stability in the sector.

Conclusion

Overall, Liechtenstein’s financial sector is well-positioned to continue serving its discerning international clients with confidence, thanks to its strong regulatory framework, exceptional capitalization levels, and commitment to sustainable business practices. With its unique blend of tradition, innovation, and sustainability, Liechtenstein remains an attractive destination for international clients seeking high-quality financial services.