The Financial Market Authority registered more assets under management and more financial market participants
The Liechtenstein financial center is characterized by continuing growth. In its 2006 Annual Report, the Financial Market Authority (FMA) registered a strong increase in assets under management. The number of financial market players also rose again relative to the preceding year. The FMA expects the growth to continue in the current year as well.
The integrated and independent Financial Market Authority (FMA) began its work on 1 January 2005. According to René H. Melliger, Chairman of the Board, the second business year was shaped by consolidation. The design of the FMA as a lean and client-oriented supervisory authority has proven itself, and the further development of the FMA is on course, Melliger states.
As the FMA Annual Report shows, the Liechtenstein financial center was again characterized by strong growth. The assets under management increased to CHF 219.4 (182.6 in the previous year) billion. Compared with the previous year, the increase was 20.2%. Client assets managed by the banks grew disproportionately, by 26.6% to CHF 173.4 (148.7 in the previous year) billion. The active securities sector showed a growth of 29.1%, considerably higher than the previous year. Investment undertakings held assets in the amount of CHF 26.6 (20.6) billion in numerous funds. Insurance undertakings were able to increase their capital investments to CHF 16.2 (10.2) billion, which represents an increase of 58.8% relative to the previous year.
Also with respect to the financial market participants, 2006 was shaped by growth. In total, the FMA registered an increase of 2.7% to 3,208 financial market actors, of which the focus of growth was largely in the asset management and investment undertaking sectors. The 3,208 players on the Liechtenstein financial market supervised by the FMA in 2006 are broken down into 1,864 (1,815 in the previous year) domestic financial market participants and 1,344 (1,097 in the previous year) companies offering services in Liechtenstein by virtue of free movement of services from abroad. Due to the pending applications and the announced new formations, the FMA expects the growth to continue in the current year.
Because of the consistent supervision of the financial center, the FMA recorded a decrease in cases of abuse in the year 2006. The exposed cases primarily concern persons and undertakings that offered activities on the financial market without the proper license. While 69 cases were registered in 2005, the number of cases of abuse sank to 33 in the reporting year. Administrative assistance granted to foreign authorities was at roughly the same level as in previous years, with 15 requests.
In his presentation of the 2006 Annual Report, Stephan Ochsner, CEO of the FMA, emphasized the increase in regulation. In Ochsner's view, one means of alleviating the impact of the regulatory burden is the transition from a rule-based approach to principle-based regulation. The FMA believes that there is still more room for this variant, which offers more flexibility for the benefit of sensible solutions. According to Stephan Ochsner's explanations, making use of this room requires the willingness of the financial industry and the authorities responsible for legislation and implementation of the EU standards to refrain from the urge to regulate every detail. "If this willingness exists," Ochsner emphasized, "this will lead to an improvement of competitiveness, both for the Liechtenstein financial market and for the European financial market."
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