Message from our Executive Chairman
2016 was another successful year for Lombard International. As we celebrated our 25th anniversary, we made several strategic investments to enhance and accelerate sustainable growth for our increasingly global enterprise. We continued to expand our network across the world, enhance our distribution and marketing capabilities, and introduce new technologies to better serve the needs of our partners and clients.
Our business operates in a global environment with progressively wide variations in economic conditions, languages and local regulations. One of the core strengths of Lombard International is the professional knowledge and capabilities of our in-house experts which serve these diverse markets and the distribution channels we access.
High Net Worth and Ultra High Net Worth wealth is becoming increasingly mobilized in today’s modern world and we have built a company with the unique ability to service and support these clients, be they located in Europe, the US, Latin America or Asia.
In 2016, we successfully executed our strategy of global expansion by extending our international footprint with the opening of new offices to complement our major hubs in Luxembourg and Philadelphia. These include:
- Brussels - We opened a branch to serve our existing partners and clients and to help facilitate new growth opportunities with private banks, family offices and wealth planners.
- Paris - We opened a representative office to consolidate our presence further in the French market and to create stronger relationships with local distribution partners.
- Bermuda - With an excellent global reputation, strong regulatory environment and robust insurance legislation, we have established this office as a key strategic center for our Transatlantic and other related business opportunities.
- Miami - We opened our new hub, which has as its focus high net worth individuals, families and institutions based in Latin America.
- New York - We opened a regional office in this major financial center for the US which is home to one of the largest concentrations of advisors to high net worth individuals, families and institutions in the country. Our local presence is supporting the ongoing growth in our distribution relationships with key partners including private banks and financial intermediaries.
- Hong Kong - We established a significant office to serve a growing local market, where there is increased demand for insurance solutions and emerging private placement life insurance market opportunities.
- Singapore - We opened this facility to serve as our new regional headquarters in Asia. This will also become our gateway for future expansion into greater China.
In addition to increasing our geographic footprint, we also built upon our existing asset base in Europe by acquiring Zurich Eurolife S.A.’s Private Banking Solutions business in Luxembourg, adding €2.3 billion to our assets under administration (AUA).
We will continue to explore non-organic opportunities that fit our strategy.
People are a key element to our success. In 2016, we appointed three talented and high caliber CEOs: Axel Hörger, Michael Gordon, and Tammy Lu Tsui to lead our businesses in Europe, the US and Asia, respectively. Furthermore, we recruited a number of senior executives in sales, technology, marketing and communications to support our growth ambitions, ensuring we continue to deliver best-in-class wealth structuring solutions that we have become synonymous with.
The group has grown to approximately 600 employees located across the globe, a team which includes more than 60 highly technical experts in wealth structuring, tax law and non-traditional assets, exclusively related to life insurance. We have over 40 different nationalities working at Lombard International, speaking 27 native languages, all focused on providing the very best service to our partners and clients.
We remain committed to further investment in technology, developing a suite of bespoke, digital solutions for our partners and clients across the globe and ensuring the level of service remains at the cutting edge of the industry.
In Europe, the launch of ‘Connect’, our online digital servicing platform, is revolutionizing our value proposition by providing our partners and clients with secure access to policy and transaction information, up to date intelligent dashboards and an interactive query handling facility; accessed from any device, 24/7.
In the United States, we introduced an online investment platform which provides partners with live access to portfolio information, investment performance and educational materials, readily available from any device. We have also launched an online enrollment portal which provides clients and partners with the ability to apply online for a Lombard International variable annuity, providing a simple path from start to finish.
Our 2016 financial performance1
Our financial results reflect the value we continue to bring to our clients and partners with sustained growth in new business and a significant increase in assets under administration. These results also reflect continued investment in new initiatives designed to enhance our wealth solutions, services and capabilities. These investments will drive higher sustained growth over the longer term.
- New Business Premium: Total new business premium written was strong at €4.5 billion, which is a new record in the company’s history.
- Assets under Administration (AUA): Total AUA grew to €77.5 billion (as of 31 Dec 2016), an increase of €5.5 billion or 8% from €72.0 billion in the prior year:
- The High Net Worth AUA totaled €40.5 billion (as of 31 Dec 2016), an increase of €5.0 billion or 14% from €35.5 billion in the prior year.
- The Corporate Administration AUA totaled €37.0 billion (as of 31 Dec 2016), an increase of €0.5 billion or 2% from €36.5 billion in the prior year.
Lombard International’s vision is to be the leading wealth structuring provider in Europe, the US, Asia and Latin America for high net worth individuals, families and institutions. By integrating our deep-rooted expertise and experience in wealth structuring with continued investment in new services and technologies across these geographies, we are well-placed to capture the anticipated growth in our chosen markets.
The ability to work with customers across multiple geographies is a core competency of the Group. Over the last 25 years, we have gained significant experience in creating wealth structuring solutions that reflect the complexity of our customers’ lives; ensuring our services remain flexible and responsive to the ever-changing regulatory environment.
The landscape for financial services globally continues to evolve with relentless changes in regulation, market consolidation, longevity, globalization as well as technological innovation. Lombard International is well placed to support our partners and clients to mutually benefit from these trends. Looking ahead, the next 25 years will be equally important for high net worth families as legacies and multi-generational inheritances become more international.
I am excited and enthusiastic about the opportunities ahead. The Board and I would like to take this opportunity to thank our partners, clients, shareholders and colleagues for their continued support.
John K. Hillman
(1) Presented at constant Euro rates as of 31 Dec 2016