The Briefing on Private Banker International 

Private Banker International looks at some of the biggest news stories of the month as M&A continues despite the coronavirus pandemic. Despite the tightening of margins, money is still being utilised to gain competitive advantages

Rothschild & Co Bank to take over Swiss rival Banque Pâris Bertrand

Rothschild & Co Bank, the wealth management subsidiary of Rothschild & Co, has agreed to purchase Geneva-based private bank Banque Pâris Bertrand.

Financial terms of the deal were not disclosed.

With offices in Geneva and Luxembourg, Banque Pâris Bertrand caters to wealthy families, family offices and institutional investors, majorly from Switzerland, and other European markets.

The firm is active in the wealth management business and also runs three asset management businesses namely, LongRun Global Equity Fund, Pâris Bertrand Systematic Asset Management and Hermance Capital Partners Private Equity investment solutions.

Four in five women from wealthy families expect to inherit substantially

Four in five women (82%) from wealthy families expect to inherit substantial wealth over the next 20 years.

However, only two in five (41%) are currently not involved in family financial decision making.

This is according to research from Barclays Private Bank entitled Smarter Succession: The Challenges and Opportunities of Intergenerational Wealth Transfer.

The study also found that four in five (83%) main decision makers around family wealth are men. Furthermore, these main decision makers, whether men or women, are more likely to turn to their sons (29%) rather than their daughters on matters of wealth, finance and investment.

Asset managers representing over $9trn join forces for net zero emissions goal

Thirty asset managers, collectively overseeing $9trn in assets, have joined forces with the aim of accomplishing net zero greenhouse gas emissions by 2050 or before.

The Net Zero Asset Managers initiative will be managed globally by six founding partner investor networks including Asia Investor Group on Climate Change (AIGCC) and Principles for Responsible Investment (PRI).

AXA Investment Managers, BMO Global Asset Management, Fidelity International, Legal & General Investment Management, Schroders, UBS Asset Management, M&G, Wellington Management and DWS are the major names in the 30-member coalition.

External global factors become principal driver in compliance progress changes

The impact of external global factors has surpassed regulatory hurdles as the principal driver in compliance progress changes.

This is according to the 6th Global Compliance Survey from Nasdaq. Representing both sell and buy side firms and market infrastructure, respondents of the survey cited external factors, notably COVID-19, as the main catalyst for the changes, unusually surpassing regulatory hurdles.

Expanding on the deviation, Valerie Bannert-Thurner, senior vice president and head of buy-side and sell-side solutions, market technology at Nasdaq, commented: “Year on year, the findings of the annual Global Compliance Survey typically show regulatory hurdles being the major factor in compliance planning and practices – but this year is different.”

Produced in collaboration with Greenwich Associates, the survey gathers qualitative and quantitative feedback from more than 200 compliance professionals and executives in the financial industry worldwide.

Hang Seng Bank unveils personalised wealth management service for HNW clients

Hong Kong’s Hang Seng Bank has introduced new signature wealth management services for HNW customers.

Dubbed Signature, this new service combines personalised wealth and banking solutions with lifestyle and health services.

The bank is offering the new service to clients with total relationship balance of HK$8m ($1.03m) or above.

Hang Seng Bank’s most senior and experienced relationship managers are dedicated to serving these clients.

CIBC Canadian wealth arm shows resilience in challenging market; US wealth unit falters

The Canadian Commercial and Wealth Management arm of CIBC has been able to withstand the Covid-19-induced turbulence, demonstrating a strong performance in Q4 2020.

Gains in this unit, supported by the capital markets division, helped temper a lackluster quarter for the overall group that was hit by a slowdown at its US commercial banking and wealth management arm.

The Canadian Commercial and Wealth Management arm of CIBC reported a net income of C$340m ($264.6m), a rise of 11%. The unit’s total revenue increased to C$515m from C$502m over the period.

Schroders unveils new Shariah-compliant fund

British fund manager Schroders has rolled out a new Shariah-compliant fund that serves as a diversified investment strategy.

Dubbed Islamic Global Equity Fund, the new vehicle integrates Shariah Law compliance with multi-factor investing.

Managed by the Schroders Systematic Investments (SSI) unit, the strategy incorporates a multi-factor investment approach.

It looks to outperform the Dow Jones Islamic Market World Index in three to five years.

Impact investing firm Asteria taps Amundi for portfolio management system

Asteria Investment Managers (IM), the impact investing affiliate of Swiss private bank Reyl Group, has turned to Amundi for the management of its assets using the latter’s portfolio management system.

Under the partnership, Amundi will supply its Amundi Leading Technologies & Operations (ALTO) to Asteria using cloud technology.

ALTO offers a range of services spanning the entire order and execution lifecycle. This includes portfolio analysis, pre- and post-trade compliance, risks, performance, processing of transactions, and holding of positions, reporting, and data management.

Deutsche Bank receives fund custody licence in China

A Chinese unit of German banking group Deutsche Bank has reportedly obtained a domestic fund custody licence, in the latest sign of China’s financial services sector liberalisation.

The licence from the China Securities Regulatory Commission (CSRC) will enable the bank to hold securities on behalf of mutual funds as well as private funds based in China after completing the relevant administrative process, noted Reuters.

Deutsche Bank is the second to secure this licence in China. In September this year, Citi became the first US bank to get the licence.

Deutsche Bank China chief country officer Rose Zhu said: “Many of our global institutional clients are actively exploring and acting on the unfolding opportunity to tap into the exponential China market, which is still fast growing and opening up.

Guernsey enhances Private Investment Fund regime

Guernsey has announced plans to upgrade its Private Investment Fund (PIF), expanding the regime with two supplemental models.

The revisions remove the need for manager involvement and will create the most comprehensive and flexible suite of options of any private fund regime.

Typically, the fund manager makes declarations in respect of prospective investors’ ability to sustain losses, the maximum number of investors, and the completeness and accuracy of the application.

Under the two new supplemental models, the PIF now provides an alternative for qualifying investors, and a “truly private structure” for family relationships.

Credit Suisse found tailing more employees than earlier revealed

Swiss investment bank Credit Suisse has reportedly been carrying out physical surveillance of more employees than formerly revealed.

According to a report by the Wall Street Journal, two prior instances of surveillance were found by law firm Homburger.

These instances were said to have taken place before the spying scandal that erupted last year, and involved the surveillance of its former wealth management head Iqbal Khan in the wake of his defection to rival UBS.

In October 2017, Credit Suisse had an employee in New York tailed outside work after it suspected the employee of misusing confidential data, stated the report citing people familiar with the matter.

JP Morgan inks deal to buy tax-smart technology specialist 55ip

J.P. Morgan Asset Management has agreed to purchase fintech firm 55ip, which offers a tax-smart investment strategy engine to support financial advisers.

The transaction, whose financial terms were not shared, comes shortly after a partnership signed between the two parties to offer tax-efficient access to model portfolios.

55ip CEO Paul Gamble said: “Joining forces with J.P. Morgan will provide greater resources for our current clients and enterprise partners, accelerate our innovation and broaden access to our solutions.

“55ip’s purpose is to break down barriers to financial progress, by finding better ways to help more people through intelligent automation. Being part of J.P. Morgan will accelerate our ability to do just that, as the industry standard tax-smart investment strategy engine.”

Coutts plants first trees in largest “tiny forest” of Europe

Private bank Coutts has planted the first 10,000 trees of a wide NatWest project to create the largest “tiny forest” in Europe.

This was part of Coutts’ promise to plant a tree for every client that chooses to go paperless. The NatWest Group collaborated with The Conservation Volunteers to carry out the project.

In addition, they are working alongside Barking & Dagenham Council, Thames Chase Community Forest, SUGI, and Wild Urban Spaces to create six new tiny forests in Parsloes Park.

The forests have been planted using the Miyawkai planting method to build dense, native forests and designed to encourage tree growth that is up to 10 times faster.

Standard Chartered pushes into crypto custody with Northern Trust partnership

UK-based banking group Standard Chartered, through its innovation unit SC Ventures, has collaborated with American asset manager Northern Trust to launch a cryptocurrency custodian for institutional investors.

Dubbed Zodia Custody, the new offering will enable institutions to invest in emerging cryptocurrency assets, including transaction and settlement activities.

It will initially support digital assets Bitcoin and Ethereal and then XRP, Litecoin and Bitcoin Cash, which collectively constitute nearly 80% of the total assets traded across top crypto exchanges.

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