VP Bank : Disclosure report, first half of 2021

Disclosure report

as of June 2021

 Seize opportunities

3 · Introduction

4 · Key metrics

5 · Capital adequacy (Art. 437 CRR)

10 · Capital adequacy requirements (Art. 438 CRR)

10 · Use of ECAIs (Art. 444 CRR)

12 · Leverage (Art. 451 CRR)

14 · Liquidity risks

15 · Credit risk adjustments (Art. 442 CRR)

"Seize opportunities"

With its Strategy 2026, VP Bank set a milestone for the future of the Group. Under the motto "Seize opportunities", we have defined, among other things, a sharpened positioning and a number of strategic measures. The annual report 2020 guides you through the key components of the new strategy and presents seven themes that illustrate the idea of seizing opportunities. Learn about our approach to markets, trends, sustainable investments, risk management, data analytics, private markets and the

intermediary business. The themes we show you here will also be encountered in a media advertising campaign slated for 2021.

report.vpbank.com

Additional information on the topic of seizing opportunities can be found in the annual report 2020 as well as in your daily ­cooperation with the VP Bank team.

Introduction

VP Bank

VP Bank is an internationally active private bank and is one of the biggest banks in Liechtenstein. It has offices in Vaduz, Zurich, Luxembourg, Tortola / British Virgin Islands, Singapore and Hong Kong.

Since its foundation in the year 1956, VP Bank has focused on asset management and investment consultancy for private individuals and financial intermediaries. Today, 1,013 employees manage client assets of CHF 60.8 billion.

VP Bank is listed on the SIX Swiss Exchange. Its financial strength has been given an "A" rating by Standard & Poor's. The shareholder base with three anchor shareholders ensures stability, independence and sustainability.

Basis and purpose of the disclosure

The Disclosure Report is based upon Part 8 of the Regulation (EU) No. 575/2013 CRR, which has been directly applicable in Liechtenstein with amendments of the Banking Act Liechtenstein (BankA) and the Banking Ordinance Liechtenstein (BankO) since 1 February 2015.

The Disclosure Report provides a comprehensive picture of the bank's capital and liquidity adequacy, its risk profile and risk management.

Content and scope of application of the disclosure

The Disclosure Report contains all qualitative and quanti­ tative information specified in Part 8 Section II CRR that has not already been published in the semiannual report of VP Bank. The exemption rules set out under Art. 432 CRR for immaterial or confidential information as well as business secrets have not been applied.

VP Bank Ltd with registered domicile in Vaduz, Liechten- stein, is the parent company of VP Bank Group and fulfils the disclosure requirements pursuant to Art. 13 Para. 1 CRR on a consolidated level. The basis for this is the ­prudential scope of consolidation pursuant to Art. 18 to 24 CRR. For this reason, all information in the Disclosure Report relate to VP Bank Group.

Frequency and means of disclosure

A comprehensive disclosure report is drawn up annually and published as a separate document on the VP Bank homepage (www.vpbank.com). Supplementary information is provided in the annual report. An additional disclosure is made every six months and is also published on VP Bank's homepage.

Preparation and assessment of the disclosure

VP Bank has implemented a process for preparing the Disclosure Report, and has defined the tasks and respon­ sibilities in writing. Within this context, the content and frequency of the disclosure is regularly reviewed in order to ascertain that this is reasonable. The Disclosure Report is not subject to any review by statutory banking auditors.

Changes compared to the disclosure report from 30.06.2020

Compared to the previous year, the scope of disclosure was not adjusted.

Disclosure report as of June 2021  ·  Introduction

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Key metrics

Key metrics

in CHF 1,000	30.06.2021	31.12.2020
Own Funds
Tier 1 Capital	977,279	972,754
Tier 1 Ratio	20.8 %	20.8 %
Risk weighted assets	4,702,908	4,675,482
Combined capital buffer requirement	213,358	212,314
Leverage
Total exposure measure	13,665,945	13,725,548
Leverage Ratio	7.15 %	7.09 %
Liquidity
Liquidity Coverage Ratio (LCR)	153.4 %	179.4 %

Own funds

The Tier 1 Ratio did not change in the first half of 2021 and remains well above the regulatory minimum requirement. The increase in loans and advances to customers leads to an increase in risk-weighted assets in credit risk.

Leverage

The Leverage Ratio changes only slightly compared with 31 December 2020.

Liquidity

The LCR decreased from 179 per cent to 153 per cent in the first half of 2021 and remains well above the regulatory minimum requirement of 100 per cent. The decline in the LCR is attributable to the active management of Amounts due from Banks and the increase in liabilities to customers.

4	Key metrics ·  Disclosure report as of June 2021

Own funds (Art. 437 CRR)

VP Bank's regulatory equity capital consists solely of core Tier 1 capital (common equity Tier 1 - CET1) and is comprised primarily of paid-in capital and retained earnings. The amounts to be deducted according to Article 36(1) of the CRR are deducted in full from core Tier 1 capital. Part 10, Title I of the CRR regarding transitional provisions is not applied.

Capital instruments

in CHF 1,000

Issuer	VP Bank Ltd, Vaduz	VP Bank Ltd, Vaduz
Unique identifier (e.g. CUSIP, ISIN or Bloomberg identifier for private placement)	registered share A	registered share B
Governing law(s) of the instrument	Liechtenstein law	Liechtenstein law
Regulatory treatment
	Common equity tier 1	Common equity tier 1
Transitional CRR rules	(CET1)	(CET1)
	Common equity tier 1	Common equity tier 1
Post-transitional CRR rules	(CET1)	(CET1)
Eligible at solo(sub-)consolidated/ solo & (sub-)consolidated	solo and consolidated	solo and consolidated
Instrument type (types to be specified by each jurisdiction)	fully paid-up share capital	fully paid-up share capital
Amount recognised in regulatory capital	60,150	6,004
Nominal amount of instrument	60,150	6,004
Issue price	60,150	6,004
Redemption price	n.a.	n.a.
Accounting classification	equity	equity
Original date of issuance	n.a.	n.a.
Perpetual or dated	perpetual	perpetual
Original maturity date	n.a.	n.a.
Issuer call subject to prior supervisory approval	no	no
Optional call date, contingent call dates and redemption amount	n.a.	n.a.
Subsequent call dates, if applicable	n.a.	n.a.
Coupons / dividends
Fixed or floating dividend/coupon	floating	floating
Coupon rate and any related index	n.a.	n.a.
Existence of a dividend stopper	n.a.	n.a.
Fully discretionary, partially discretionary or mandatory
(in terms of timing)	fully discretionary	fully discretionary
Fully discretionary, partially discretionary or mandatory
(in terms of amount)	fully discretionary	fully discretionary
Existence of step up or other incentive to redeem	n.a.	n.a.
Noncumulative or cumulative	n.a.	n.a.
Convertible or non-convertible	non-convertible	non-convertible
If convertible, conversion trigger(s)	n.a.	n.a.
If convertible, fully or partially	n.a.	n.a.
If convertible, conversion rate	n.a.	n.a.
If convertible, mandatory or optional conversion	n.a.	n.a.
If convertible, specify instrument type convertible into	n.a.	n.a.
If convertible, specify issuer of instrument it converts into	n.a.	n.a.
Write-down features	n.a.	n.a.
If write-down,write-down trigger(s)	n.a.	n.a.
If write-down, full or partial	n.a.	n.a.
If write-down, permanent or temporary	n.a.	n.a.
If temporary write-down, description of write-up mechanism	n.a.	n.a.
Position in subordination hierarchy in liquidation
(specify instrument type immediately senior to instrument)	n.a.	n.a.
Irregular features of the converted instruments	n.a.	n.a.
Description of any irregular features	n.a.	n.a.

Disclosure report as of June 2021  ·  Own funds (Art. 437 CRR)

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