Bloomberg News

Rothschild’s Zurich Wealth Unit Targets Growth in ‘Old’ Markets

December 09, 2011

Dec. 6 (Bloomberg) -- Rothschild Group’s wealth management unit in Zurich plans to meet targets for increasing assets by focusing on “old” markets in Europe as a crackdown on tax evasion crimps margins at Swiss private banks.

“The onshore markets are the fastest-growing markets in our bank,” said Thomas Pixner, head of private clients at Rothschild Wealth Management and Trust. “Everybody told us four years ago ‘forget about old markets; you can’t grow anymore,’ but we’ve created a lot of growth.”

Rothschild aims for “high single-digit” percentage annual growth in assets under management from the 11.8 billion euros ($15.9 billion) reported on March 31.

Rothschild, which traces its roots to family banking dynasty started by Mayer Amschel Rothschild in the 1760s, expects to win new clients as German entrepreneurs sell businesses over the next 10 years, said Riccardo Petrachi, who was hired this year from UBS AG to head the bank’s ultra-high- net-worth unit. The U.K. is another core market for Rothschild, which requires at least 1 million euros to open an account.

At least half of the Zurich wealth business is in cross- border accounts held by clients from countries including the U.K., Spain and France. Some customers have asked to transfer money to onshore accounts amid a global crackdown on tax evasion, said Pixner, who declined to comment on the profitability of different types of client.

Switzerland reached agreements with Germany and the U.K. this year over taxation of undeclared bank accounts. Revenue generated from the tax on investment and capital gains will go to the German and U.K. treasuries while client identities remain secret.

The Zurich-based firm competes in Switzerland with Banque Privee Edmond de Rothschild, the Geneva arm of the Rothschild family.

--Editors: Dylan Griffiths, Keith Campbell.

To contact the reporter on this story: Giles Broom in Geneva at gbroom@bloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net


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