During the first six months of the year, the Liechtensteinische Landesbank (LLB Vaduz) saw its net profit plunge 77 percent to 13.6 million Swiss francs ($14.7 million), the bank said in its earnings statement.
The result, by comparison with the outcome for the same period of last year, was hit by a number of one-time costs.
These included restructuring costs and the settlement of a long-standing tax dispute with the United States, which together set back its net profit by 58.4 million francs.
The bank said late last month that it had agreed to pay $23.8 million to American tax authorities, which in turn would refrain from any legal actions against the bank.
The US Justice Department and a New York District Attorney's office have been probing whether LLB had used Liechtenstein's banking secrecy practices to help US clients violate US tax and security laws.
In addition to dropping their investigation, the US authorities had agreed not to impose any fines or criminal penalties on the bank, it said.
The bank maintained in July that the agreement would have no impact on its income statement, but said it was setting aside provisions for further negotiations over a separate dispute between Washington and its Swiss wing.
On Thursday, it said it had set aside further provisions amounting to 31.2 million francs "for a possible outflow of assets in connection with payments to the US authorities."
Company chief Roland Matt welcomed the agreement.
"The resolution of the US taxation dispute establishes clear conditions for the LLB Vaduz, which also benefit our clients and shareholders," he said in the earnings statement.
Liechtenstein and Switzerland have traditionally been prime destinations for undeclared funds owing to their long sacrosanct banking secrecy practices.
However, as a weak global economy takes its toll, other countries, and the United States especially, have been putting their feet to the fire with demands of accountability for tax dodgers and the banks that help them.
LLB Vaduz, which announced a vast restructuring plan in March, said on Thursday that its Swiss division would cease all activities by the end of the year, and that its Lugano division would be sold over the next few weeks.