Information unaudited Information ungeprüftFinance and risk management

At the LLB Group, we operate in a challenging environment characterized by geopolitical upheaval, technological change and increasing regulatory requirements. Our aim is to be economically successful through capitalising on opportunities and carefully weighing up risks.

Stability and security

Stability is a key value for LLB. It is reflected in our solid equity base, conscious balance sheet policy and responsible approach to risk. As a bank of systemic importance, we are subject to particularly stringent financial market regulation and must meet high capital adequacy requirements. We significantly exceed these requirements. Our financial strength is also confirmed by our very good Aa2 rating from rating agency Moody’s.

What is more, Liechtenstein is a secure and stable business location and financial centre – as confirmed again in 2025 by Moody’s AAA rating. Clear and pragmatic regulation as well as a modern protection scheme add to its attractiveness as a location.

Our financial and risk management is geared towards the long term. Over the past few years, we targeted and developed it further under the ACT-26 strategy, making processes more efficient, strengthening prevention mechanisms and bundling central functions.

Financial management

The aim of our financial management is to create transparency at all levels of management in order that costs and income can be managed in line with corporate strategy in an efficient and timely manner. The key instruments used for this are:

• medium-term planning;
• the annual budgeting processes;
• key performance indicators from the Group’s management information system;
• the planning and management of capital and liquidity.

The tasks of financial management include the preparation of the annual financial statements as well as meeting regulatory reporting requirements.

Risk management

Our risk management identifies, assesses and controls all material risks and, in so doing, ensures a strong financial base and long-term stability. It differentiates between financial and non-financial risks.

Financial risks

These include:

• Credit risks: independent credit decisions made by Group Credit Management and central bodies; differentiated assessment of affordability and collateral values;
• Market and interest rate risks / asset liability management (ALM): control and oversight by Group Treasury through selected methods and clear limits;
• Liquidity risks: ensuring the ability to meet financial obligations permanently through robust processes, in particular the annually conducted internal liquidity adequacy assessment process (ILAAP);
• Capital risks: ongoing assessment of capital adequacy to ensure risk-bearing capacity (internal capital adequacy assessment process, ICAAP) and stress tests.

Non-financial risks

Non-financial risks are operational risks, compliance risks and cyber risks. Within the LLB Group, we use a multi-stage control system with clear responsibilities to successfully address these risks. At the same time, we continue to develop our security mechanisms further.

• Operational risks: Information security, data protection, cyber security and the internal control system are managed by Group Business Risk Management.
• Compliance risks: All measures to combat money laundering and the financing of terrorism and proliferation (financing and distribution of weapons of mass destruction) as well as compliance with international sanctions are bundled in Group Financial Crime Compliance; tax compliance, regulatory compliance and, in particular, the handling of conflicts of interest are monitored by Group Legal & Regulatory.
• Cyber risks: Modern protection systems, the Cyber Defence Center and regular testing protect against risks such as malware, social engineering and data theft. We are guided by regulatory requirements such as the Digital Operational Resilience Act (DORA).

Our internal control system (ICS) and business continuity management (BCM) strengthen processes and safeguard stability and operational functionality during normal operations and in crisis situations. The implementation proceeds according to the principle of the three lines of defence with clear responsibilities:

• First Line: operating units
• Second Line: independent control and compliance functions such as Group Business Risk Management, Group Legal & Regulatory and Group Financial Crime Compliance
• Third line: internal audit

This structure ensures appropriate controls are in place to support effective management.