LGT’s Profit Slips as Costs Grow Higher
Liechtenstein-based LGT recorded a lower profit in 2024 as operating expenses increased from costs linked to personnel and the integration of the newly acquired UK wealth business from abrdn.
LGT’s group profit for 2024 fell 5 percent year-on-year to 356.2 million Swiss francs ($404.2 million), according to the bank’s financial results.
Total operating income increased 4 percent to 2.67 billion francs as income from services rose 13 percent to 1.77 billion francs while income from trading activities and the operating income also grew 13 percent to 556.6 million francs. Net interest income decreased 33 percent to 347.9 million francs in the normalized interest rate environment.
Personnel expenses increased 9 percent to 1.62 billion francs on the back of organic staff growth and the integration of the UK wealth
management business acquired from abrdn. Business and office expenses were also up 9 percent to 465.8 million francs due to higher costs for IT and digitalization. Depreciation, amortization and provisions decreased 24 percent to 152.7 million francs, mainly reflecting lower provisions.
The cost-income ratio increased to 78 percent at the end of 2024, compared with 74.2 percent at end-2023.
AUM Growth
The bank’s assets under management increased 16 percent to 367.5 billion francs, of which 11.9 billion francs was attributable to net asset inflows. This corresponds to a growth rate of 4 percent.
Business Strategy
Moving forward, LGT will continue to pursue its long-term growth and investment strategy. This includes expanding its market presence in Germany, Australia, India, Japan and Thailand. The bank notes that the integration of the UK wealth management business acquired from abrdn has been completed while the recent acquisition of Commonwealth Bank of Australia's Private Advice business in November 2024 is expected to close in mid-2025.
The bank will also focus on investments in IT infrastructure and digitalization efforts. Its digitalization strategy launched in 2023 includes an investment of 200 million francs over five years with a digital development hub in Barcelona that supports the launch of innovative tools. The goals include the leveraging of tech, such as generative artificial intelligence, to offer enhanced services to clients and to increase the efficiency of internal processes.
«LGT developed favorably in 2024, reinforcing its foundation for future success. We continued to execute our long-term strategy, enhancing our presence in both our new and our established markets across Europe and Asia-Pacific, while driving digital innovation,» commented H.S.H. Prince Max von und zu Liechtenstein, chairman of LGT.
