Semi-annual results: Bank Frick defies the coronavirus pandemic
The first half of 2020 at Bank Frick was dominated by the global coronavirus pandemic. Despite the prevailing uncertainty and high volatility on the financial markets and the unstable economic situation, the Bank generated a net profit of CHF 1.8 million. Because of the pandemic, Bank Frick cannot rule out the occurrence of credit defaults. In keeping with the principle of prudence, the Bank will create provisions accordingly. As such, Bank Frick anticipates a net income in the range of CHF 1.0 to CHF 2.0 million.
Balzers (LI) – The global economy – and thus also the business performance of Bank Frick – was severely impacted by the pandemic and the associated drastic economic contractions. Planned projects had to be postponed, and the prevailing uncertainty on the markets had an effect on the Bank’s course of business – both positive and negative. While interest income did not reach levels of the previous year due to low key interest rates worldwide, commission and service transactions benefited from increased activity on the financial markets. Earnings in this area rose by more than CHF 1.0 million to CHF 10.6 million.
Key focus on IT projects with a direct client benefit
Because of the coronavirus crisis and the associated restrictions on personal contacts, sales activities in the reporting period were not able to be carried out as planned. “Banking is and always will be a people business, but because of the lockdown, personal contact suddenly became impossible. Meetings, trade fairs and events of every nature were postponed or cancelled entirely”, explains Bank Frick CEO Edi Wögerer. “For this reason, we focused primarily on IT projects that directly benefit clients.” Particularly with the digital onboarding tool, which was introduced in March, we are aiming to significantly shorten the onboarding process and thus increase client benefit. “We are working hard on achieving this goal so as to improve the customer experience. In this regard, it is extremely important for us to emphasise that we will not make any compromises in terms of vetting clients. Observing all compliance requirements and regulations is at the core of our services”, continues Wögerer.
Highlighting pioneering role in the field of crypto and blockchain banking
We also expanded the features of Bank Frick online banking in the reporting period. “I am particularly pleased that trading in cryptocurrencies is now possible through our online banking service. This once more underscores our pioneering role in the area of crypto and blockchain banking, and it is another example of how classic and blockchain banking are becoming increasingly integrated”, beams Wögerer. All assets – whether Fiat or crypto – can now be traded on one interface.
Increase in client assets under management
Client assets under management increased by CHF 403.0 million in the first six months of the 2020 financial year to CHF 3,137.0 million as at 30 June 2020. Net new money outflow amounted to CHF 103.0 million as at the reporting date.
Outlook for the second half of 2019
In the second half of 2020, Bank Frick’s focus will be on the development of a powerful sales structure. “In recent years, we have made significant investments in technology, regulatory issues, compliance and the establishment of new business models. Now we intend to bring these assets to clients even more efficiently”, explains Wögerer.
We will do everything possible to defend and further expand our pioneering role in blockchain banking. In the process, we will continue to adhere to our crossover approach and integrate blockchain and classic banking wherever possible”, continues Wögerer.
Uncertain planning as a result of the coronavirus
The coronavirus pandemic has made it extremely difficult to anticipate how the global economy and, as such, Bank Frick’s business performance will develop as time goes on. On this basis Bank Frick cannot rule out the possibility of credit defaults – especially in the field of SMEs. In keeping with the principle of prudence, the Bank will create provisions accordingly. “Because of that, and due to the fact that the pandemic continues to make it difficult to estimate the further development of business performance, we anticipate net income in the range of CHF 1.0 to CHF 2.0 million”, says Wögerer.
“Despite the uncertainty caused by the coronavirus, we are viewing the second half of 2020 with equanimity. The quality of our staff is outstanding, and the employees have already demonstrated that they are equal to the challenge posed by this extraordinary situation”, concludes Wögerer.
About Bank Frick
Bank Frick specialises in banking for intermediaries. The Liechtenstein bank provides a fully integrated offering of classic banking and blockchain banking services. Its clients include fintechs, asset managers, payment service providers, family offices, fund promoters, pension funds and fiduciaries.
Bank Frick has been family-run since its foundation as a licensed universal bank in 1998, and it adopts an entrepreneurial approach. The Bank is currently under the majority control of the Kuno Frick Family Foundation (65 per cent). Net1, the Nasdaq-listed financial technology group, owns 35 per cent of its share capital. The Bank employs over 130 members of staff at its Balzers office and operates a branch in London, UK.
Bank Frick is one of Europe’s pioneers of the regulated blockchain banking sector. Its offering covers trading and custody of crypto assets, as well as token sales. The Bank also develops tailored crypto-structuring solutions for intermediaries.
In addition to its highly regarded basic services, Bank Frick’s classic banking offerings cover services for funds and issues, focusing on formulating European (AIF, UCITS) and national fund solutions. In the capital market sector, Bank Frick develops tailored financial products for intermediaries and supports them along the whole issue process, acting also as a custodian bank.
Bank Frick is the only Liechtenstein bank with acquiring licences from Visa and MasterCard, and it can process card payments globally for payment service providers and their online merchants.
In 2019, Bank Frick took over the fintech company Tradico AG, which specialises in finance for goods purchasing for SMEs, and acquired a majority stake in the fintech company 21.finance AG, which operates area2Invest, a digital investment platform for classic and tokenised financial products.
Als einzige liechtensteinische Bank besitzt Bank Frick Acquiring-Lizenzen von Visa und Mastercard und kann weltweit Kartenzahlungen für Zahlungsdienstleister und deren Onlinehändler abwickeln. Bank Frick übernahm 2019 das auf Wareneinkaufsfinanzierung für KMU spezialisierte Fintech Tradico AG sowie die Mehrheit am Fintech 21.finance AG, welches mit area2Invest eine digitale Investmentplattform für klassische und tokenisierte Finanzprodukte betreibt.