Semi-annual results of Spektral Bank – operating income continues to rise

Continued business growth and less investment in personnel and infrastructure going forward: this sums up the first half of 2019 at Spektral Bank. In the first six months, a net profit of CHF 1.5 million was generated. Spektral Bank took steps to secure its future during the reporting period, investing in four companies to expand and solidify its ecosystem.

2019 has seen continued growth for Spektral Bank. The Bank is systematically pursuing its strategy of working closely with financial intermediaries, offering products for alternative asset classes and fund services, and becoming an internationally leading partner in the blockchain sector. With this strategy in mind, Spektral Bank evaluated and acted on various strategic opportunities over the course of the first half of the year. It also founded two subsidiaries: The DLT Markets AG and Distributed Ventures AG. Furthermore, it took a stake in the fintech companies Tradico AG and AG.

Constant growth in revenues: the trend continues

The encouraging trend of growth in operating income continued in the first half of 2019. Income from commissions and trading activities rose once again. Interest income also saw a continuation of the positive trend of recent years. Strategic investments caused personnel and operating expenses to be higher than budgeted. Since important projects are about to be completed, the Bank expects lower operating expenses in the future, which will have an advantageous impact on the expense side.

The balance sheet total amounted to CHF 990 million as at 30 June 2019, which was 7% lower compared to the balance sheet total on 31 December 2018.

Client assets under management increased by CHF 61 million in the first six months of the 2019 financial year to CHF 2,719 million as at 30 June 2019. Net new money outflow amounted to CHF 5.7 million as at the reporting date.

Outlook for the second half of 2019

The strategic investments mean that the Bank does not expect to achieve the projected net income of CHF 3.6 million. Spektral Bank now expects net income for this year to amount to approximately CHF 2.0 million. CEO Edi Wögerer is satisfied nonetheless: “We are excellently staffed, both in terms of quality and quantity. We have stayed true to our strategy and taken bold steps to secure our future by founding subsidiaries and investing in promising companies. We are well equipped to meet the challenges of the future and look forward to confidently striding into the second half of the year.”

Blockchain Act set to open the doors to growth

The Liechtenstein Parliament considered the Law on Transaction Systems Based on Trustworthy Technologies (TT Act) in a first reading during the summer of 2019 and is expected to adopt the law in a second reading during the autumn of 2019. It is expected that the law will enter into force at the beginning of 2020.

Spektral Bank considers the draft law to be a highly promising and important building block that will make the Liechtenstein financial centre fit for the future. Today, Spektral Bank already applies banking standards to blockchain banking. For this reason, the Bank does not anticipate any major need to adjust internal processes. In view of the entry into force of the TT Act, Spektral Bank is already working on the development of business models and financial instruments that are adapted to it.

Partnership with the university: investing in Liechtenstein’s fintech ecosystem

The belief in Liechtenstein’s fintech location has inspired Spektral Bank to make a substantial contribution to its future. To mark Spektral Bank’s 20th anniversary last year, the Bank entered into a partnership with the University of Liechtenstein in the areas of blockchain and fintech in 2018. During the planned five-year collaboration, partnership-based research projects and projects with students will be carried out. Part of the partnership is an annual certificate programme. This was offered for the first time at the beginning of 2019. Last week, the successful students were awarded a Certificate in Blockchain and Fintech. The presence of Adrian Hasler, Prime Minister of Liechtenstein, underlined the importance of blockchain and fintech for the future of the financial ecosystem in Liechtenstein.

The half-year report 2019 can be downloaded here.

About Spektral Bank

Spektral Bank 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.

Spektral Bank has been family-run since its foundation as a licensed universal bank in 1998 and adopts an entrepreneurial approach. Today, the Bank is majority controlled by the Kuno Frick Family Foundation (65 per cent), the Nasdaq-listed financial technology group Net1 owns 35 per cent of Spektral Bank’s share capital. The Bank employs over 120 members of staff at its Balzers office and operates a branch in London, UK.

In addition to its proven basic services, Spektral Bank’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, Spektral Bank develops tailored financial products for intermediaries and supports them along the whole issue process, acting also as a custodian bank.

Spektral Bank is one of Europe’s pioneers of the regulated blockchain banking sector. As well as offering trading and custodian services for crypto assets, the Bank supports token sales and develops tailored crypto structuring solutions for intermediaries.

Spektral Bank is the only Liechtenstein bank with acquiring licences from Visa and MasterCard to process card payments globally for payment service providers and their online merchants.

Spektral Bank established subsidiaries in 2019 to appear independently on the market with new services: Distributed Ventures AG, an incubator and accelerator to promote and finance fintech and blockchain start-ups as well as The DLT Markets AG which offers institutional investors professional access to digital assets. In 2019, Spektral Bank also acquired fintech Tradico AG, which specialises in trade financing for SMEs, and the majority of fintech AG, which operates area2Invest, a digital investment platform for classic and tokenised financial products.