Credit Suisse private bank co-heads confident of growth

Tue Nov 19, 2013 2:59am EST
 
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By Katharina Bart and Oliver Hirt

ZURICH (Reuters) - Credit Suisse CSGN.VX plans to lean more heavily on its private banking franchise, targeting a bigger share of lucrative ultra-rich clients as tougher regulation and volatile markets dent investment banking returns.

"We haven't systemically taken advantage of all the opportunities that we see with our clients globally," Robert Shafir, co-head of Credit Suisse's private bank, told Reuters in his first interview since taking over the unit a year ago.

The Zurich-based bank aims to harness its large balance sheet to lend more to wealthy individuals and increase its share of ultra-rich clients, typically with asset of more than $50 million, to roughly half of its overall assets under management, from 44 percent currently.

"We have a pretty ambitious set of plans in terms of expanding our wallet share on the liability side of the balance sheet with our clients," Shafir said.

To keep pace with the increasing number of millionaires, Shafir and his co-head Hans-Ulrich Meister are aiming for the private bank to account for half of the group's risk-weighted assets (RWAs), against around a third currently.

"You read and hear a lot of noise about our industry and its transformation, but what you don't hear so much about is the major growth potential it has," Meister told Reuters in a separate interview.

Many private banks have spurned lending to the wealthy, despite the potentially lucrative returns, in favor of focusing on winning new assets to manage.

"They simply did not understand the true and complete interests of global high-net worth individuals," says Sebastian Dovey, managing partner of London-based wealth consultancy Scorpio Partnership.   Continued...

 
Hans-Ulrich Meister, co-head of private banking and wealth management at Swiss bank Credit Suisse, gestures during an interview with Reuters in Zurich November 8, 2013. Credit Suisse plans to lean more heavily on its private banking franchise, targeting a bigger share of lucrative ultra-rich clients as tougher regulation and volatile markets dent investment banking returns. REUTERS/Arnd Wiegmann