Liechtenstein's LGT said it will continue to invest in expanding its business, after profit last year rose 9 percent and it took in fresh client assets at a remarkably high rate.

Owned by the principality's royal family, LGT splashed out on ABN Amro's private banking activities in Asia and the Middle East just three months ago.

On Monday, the bank said that its profit rose 9 percent on the year to 230 million Swiss francs. LGT's story is similar to that of the private banking industry: clients remained reluctant to trade last year, leaving banks sitting on high fixed costs without the volume of transactions needed to generate fees and commissions.

LGT's rise in spending far outpaced that of revenue, but the Vaduz-based private bank released provisions, which smoothed the bottom line.

Rapid Money Growth

The bank said it won 11.7 billion Swiss francs in net new money last year, from all regions and business divisions. The net new money reading translates to 9 percent growth on existing assets – a remarkable rate compared to giants like UBS and Julius Baer.

The bank's spending base rose sharply as a result of new hires and bonuses, sending LGT's cost-income ratio to 74.2 percent, from 71.2 percent last year. «We want to continue on the path we have set out by strengthening our client offering further,» LGT's CEO, H.S.H. Prince Max von und zu Liechtenstein, said in a statement.

Growth By Acquisition

The bank's overall assets climbed 18 percent to 152.1 billion francs, boosted by the 8 billion from the recently-acquired LGT Vestra, a London-based wealth manager. The bank said it expects the ABN Amro deal as well as the acquisition of European Capital Fund Management, disclosed earlier this month, to close in the second quarter.

LGT can afford to grow by acquisition: with a Tier 1 ratio of 20.2 percent and high liquidity, it is very well capitalized. To be sure, the bank must show that it can scale business volume from the purchases.

The bank said that it is optimistic for business this year and further out, despite ongoing market uncertainties.