Vaduz, Liechtenstein - Liechtenstein's LGT Group on Tuesday reported a 36 per cent drop in profits for 2008, as well as net cash outflows of 1.3 billion Swiss francs
(1.1 billion dollars).

Last year, LGT's profits were 163 million francs compared with 255 million in 2007. It had 78 billion francs under management at the end of 2008, a decline which was attributed to "negative market effects."

The group was part of a major row last year between the tiny Alpine principality and Germany and the US, among other countries, after Berlin paid a whisteblower for information on German citizens who were evading taxes by keeping their assets in Liechtenstein.

That tax affair was said to have hurt LGT's second half of the year - which was also marred by the global economic downturn.

LGT, owned by the princely house of Liechtenstein, said its decision to exit the trust business, which was responsible for a large part of the outflows, and focus on asset management would help it weather the economic storm and the specific turmoil that the German-speaking principality has faced.

Last week, Liechtenstein, branded a tax haven, said it would change its banking secrecy laws to get itself off a blacklist.

Similar moves have been announced by Andorra, Austria, Luxembourg and Switzerland ahead of next month's G20 summit in London, which is expected to crack down hard on tax havens in the wake of the global financial crisis. (dpa)