ZURICH (Reuters) - HSBC (HSBA.L), in the spotlight after details emerged about how its Swiss unit allegedly helped clients dodge taxes, isn’t the troublemaker it is currently depicted as, the head of a rival private bank was quoted saying on Saturday.
“HSBC has been described as the troublemaker in class, and it is not,” Carlos Esteve, founder and CEO of Geneva-based Heritage, said in an interview with Swiss daily Le Temps. “HSBC was among the first to take steps to regularize its clients. Other institutions have been far slower.”
The comments are noteworthy because the unspoken rule among Swiss private bankers is to avoid directly commenting on rivals, a rare exception being three years ago when UBS UBSG.VX head Sergio Ermotti suggested Zurich’s main banking thoroughfare, Bahnhofstrasse, was full of banks which took untaxed money, as did UBS.
Ermotti was criticized by other bankers at the time for speaking out.
Founded in 1986, Banque Heritage is part of a program brokered by the Swiss government for Swiss banks to come clean on their untaxed American clients, paying fines and cooperating with authorities in order to avoid prosecution.
Esteve said Heritage hoped to conclude the program by mid-year, but didn’t say how much the bank expected to pay.
With roughly 6 billion Swiss francs ($6.3 billion) in assets, Heritage is one of a host of small private banks fighting to survive. Some experts predict the sector will shrink by about a third in coming years, squeezed by the regulatory clampdown and more recently by the strong Swiss franc.
But Esteve has plans for Heritage including doubling its assets under management to up to 14 billion francs. “Even if it sounds ambitious, it is probably what is needed today, given the constraints that have been imposed on our business,” he said.
Reporting by Katharina Bart; Editing by David Holmes