9 Capital adequacy requirements (Pillar I)

The adequacy of capital resources is monitored by the LLB Group and the individual operative units. The monitoring activity is based on the capital requirement regulations of the Principality of Liechtenstein, which in turn are based on the directives of the Basel Committee on Banking Supervision as adapted by the European Union.

In accordance with Basel II, the banks may choose from various approaches to calculate the capital requirements for credit, market and operational risks. The LLB Group applies the standard approach for credit risks, the basic indicator approach for operational risks and the de minimis approach for market risks. The determination of capital requirements and tier capital is carried out on the basis of the IFRS consolidated financial statement, whereby non-realised gains are deducted from core capital.

At the LLB Group, the scope of consolidation for determining capital requirements and for the financial accounts is identical. The relevant consolidation information can be found on page 138 of the annual report.

Apart from the legal provisions, which prevent the transfer of funds or equity within the LLB Group, there are no other restrictions.

Capital adequacy requirements (Pillar I)

(XLS:)

in CHF thousands

31.12.2013

31.12.2012

Tier 1 ratio (in percent)

18.8

15.7

 

 

 

Eligible capital

 

 

Share capital

154'000

154'000

Share premium

26'298

49'458

Retained earnings

1'649'358

1'645'229

Other reserves

1'083

–35'145

Non-controlling interests

104'278

100'817

Less distribution of profit

–43'279

–42'631

Non-realised gains after tax

–17'749

–22'124

Core capital (before adjustment)

1'873'989

1'849'604

Net long position in own shares

–167'816

–205'048

Other elements to be deducted from core capital

–167'401

–275'117

Eligible core capital (adjusted core capital)

1'538'772

1'369'439

Total eligible capital

1'538'772

1'369'439

 

 

 

Risk-weighted assets

 

 

Credit risks balance sheet transactions

6'943'825

7'529'200

Credit risks off-balance sheet transactions

143'338

111'375

Market risks

314'038

311'175

Operational Risks

768'338

773'450

Total risk-weighted assets

8'169'539

8'725'200

 

 

 

Required capital

 

 

Credit risk

553'158

594'148

of which price risk related to shares in the banking book

42'387

41'406

Non-counterparty related risks

13'815

17'097

Market risk

25'123

24'895

of which interest instruments

0

0

of which equities

0

0

of which forex and precious metal

9'992

19'594

of whihc commodities

15'131

5'301

of which settlement and delivery risks

0

0

Operational risks

61'467

61'876

Total required capital

653'563

698'016

Segmentation of credit risks

(XLS:)

 

Regulatory risk weighted

in CHF thousands

0 %

10 %

20 %

35 %

50 %

75 %

100 %

150 %

Total

31.12.2013

 

 

 

 

 

 

 

 

 

Central governments and banks

2'112'914

0

143

0

0

0

0

0

2'113'057

Public authorities

28'273

0

1'398

0

0

0

3'504

0

33'175

Administrative bodies

5'916

0

81

0

21'608

0

1'856

0

29'461

International organizations

0

0

2'292

0

0

0

0

0

2'292

Banks and securities firms

14'914

0

5'072'839

0

924'734

0

0

0

6'012'487

Companies

0

0

61'523

0

942

0

547'376

207

610'048

Retail

135'353

0

428

0

1'440

181'002

711'782

1'121

1'031'126

Secured by pledge

2'789

0

0

6'671'408

588'756

0

1'775'283

0

9'038'236

Overdue positions

0

0

0

0

0

4'499

28'859

12'269

45'627

Shares

0

0

0

0

0

0

7'603

348'153

355'756

Covered debentures

114'506

436'486

99'891

0

4'161

0

0

0

655'044

Unites in equity funds

1'015'223

0

0

0

0

0

18

0

1'015'241

Total

3'429'888

436'486

5'238'595

6'671'408

1'541'641

185'501

3'076'281

361'750

20'941'550

Total previous year

2'342'112

355'755

4'726'963

6'652'077

1'955'996

226'712

4'490'556

334'558

21'084'729

Mitigation of credit risk

(XLS:)

 

31.12.2013

31.12.2012

in CHF thousands

Covered by
recognised
financial
collateral

Covered by guaran­tees

Other credit commit­ments

Total

Covered by reco­gnised financial collateral

Covered by guaran­tees

Other credit commit­ments

Total

Balance sheet positions

0

1'900

0

1'900

0

2'600

0

2'600

Off-balance sheet positions

0

0

0

0

0

980

0

980

Derivatives

0

0

0

0

0

0

0

0

Total

0

1'900

0

1'900

0

3'580

0

3'580

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