Strong private banking growth forecast

An average annual growth of 24 percent for private banking in
Brazil is forecast for the next three years, according to chief
executives in a poll of local wealth managers.

The survey, by Pricewaterhouse-Coopers (PwC), suggests Brazilian
growth will be a little off the pace of international wealth
expansion, which a recent PwC survey suggests could hit 30 percent
annually in the next few years.

While global private banking CEOs anticipate that revenues will
grow at an annual rate of 26 percent over the next three years,
their Brazilian counterparts are forecasting a 31 percent increase.
Only their Asia-Pacific colleagues have a more positive view of
their future revenues, expecting 37 percent growth.

More than one-half of the private banks in Brazil hold between 21
and 40 percent of their clients’ assets, while one-third hold
between 41 percent and 60 percent. The survey suggests that private
bankers expect more clients to turn to their services in the near
future: 44 percent forecast that they will hold between 61 and 100
percent of their clients’ assets in three years time. Currently,
none can boast of such penetration.

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The Brazilian investment banking association, which presented the
findings, estimates that the private banking market locally totals
$172 billion in assets under management.


EFG moves into structured products

EFG International is to launch a structured products business in
order to widen its suite of products to clients. EFG Financial
Products, which will create structured products internally, will be
made up of a Swiss securities dealer and a Guernsey issuing entity
and will be fully operational in December. It will initially focus
on the Swiss market.

The new unit will issue instruments in the EFG name, with a strong
orientation towards listed products. It will be open to the market
at large, not just existing clients.

The management team includes Lukas Ruflin, the general manager of
EFG Financial Products (Guernsey); Jan Schoch, with responsibility
for distribution and financial engineering; and Michael Hartweg,
who will be responsible for structuring and trading.

Lonnie Howell, EFG’s chief executive, said: “To us, the thinking
that goes into structured investment products is central to wealth
management, and we are seeing strong appetite among our clients for
us to provide practical solutions in some of the more complex
product areas.”

EFG is estimated to be one of the industry leaders in maintaining a
relatively small proportion of client assets held in own-funds. In
EFG’s case, the proportion is a slim 6 percent; 20 percent was held
in third-party funds as of this June.


Clariden Leu CEO leaves

Bernard Stalder, chief executive of Clariden Leu, owned by Credit
Suisse Group, is to leave the bank, in the most recent sign of
upheaval after a 2006 merger. Stalder, whom the bank said is
retiring for personal reasons, is being replaced by the man
appointed in August as his deputy, Hans Nuetzi.

The interim successor to Nuetzi as head of investment products and
wealth management services will be Stefan Krauchi, who was recently
appointed head of investment funds and alternative investment

For the past seven years, Krauchi has worked at AIG as chief
executive of AIG Fund Management (Switzerland) and as a member of
the executive board of AIG Private Bank. Since 2006, he has also
acted as head of international fund business development in AIG

Clariden Leu has made a number of senior executive changes in
recent months after investments chief Beat Wittmann left, along
with a number of colleagues, for a similar role at Julius Baer
earlier this year. The group, which was formed last year from
several independently operated Credit Suisse banks – Clariden Bank,
Bank Leu, Bank Hofmann and BGP Banca di Gestione Patrimoniale – has
found growth difficult to achieve. Its first-half net profit fell 6
percent to CHF317 million ($281 million) because of merger

Credit Suisse continues to reject speculation it will dispose of
the unit. “Our strategy with Clariden Leu hasn’t changed, and it
remains an important part of our private bank,” Credit Suisse chief
financial officer Renato Fassbind said.


UBS buys French asset manager

UBS is buying Commerzbank’s French asset management arm, Caisse
Centrale de Réescompte (CCR), for about €435 million ($620
million). The deal adds about €17 billion in invested assets to
UBS, which oversaw more than $2.8 trillion at the end of

“The combined entity further strengthens the presence of UBS in
France and underlines its strong commitment to the European
market,” said John Fraser, head of global asset management.

CCR is UBS’s first acquisition of a wealth manager in more than a
year. The French firm has about 190 employees and units for banking
services, equity funds, fixed income and private clients, which
will be integrated into the asset management and wealth management
business of UBS in France.

This is Commerzbank’s second disposal of an asset management firm
this year, after agreeing in March to sell its UK-based Jupiter
Fund division to TA Associates and the unit’s management for £740
million ($1.5 billion). Jupiter had about £19.2 billion in

“Commerzbank has completed its stated goal of fully refocusing its
asset management activities on its German subsidiary, Cominvest,”
the German bank said.

Commerzbank has also reinforced its efforts in the real estate
sector for high net worth and institutional investors. It has
combined Commerz Grundbesitz Gruppe and CommerzLeasing und
Immobilien, two of its real estate divisions, into a single entity
called Commerz Real. The resulting unit creates a real estate asset
management manager and provider of leasing and investment services
with around €42 billion under management.


Geneva banks positive on profits

Geneva-based private banks expect profits to rise by 15 percent in
2007 compared with last year, the Geneva Financial Centre reported
in a survey. This upgrades an earlier survey that foresaw only a 10
percent gain in earnings growth.

Ivan Pictet, president of the centre, said the positive view
chiefly reflected a strong first-half performance by Geneva banks.
It will “prove to be an excellent year, especially as it has
exceeded 2006 which had already surpassed all expectations”, he

Banks expect assets under management to grow 10 percent on average
this year versus the 15 percent in 2006. European countries will be
responsible for more than one-half of new inflows.

Michel Dérobert, the executive manager of the Geneva Private
Bankers Association, called for tax changes and other improvements
that could help the Swiss marketplace remain competitive against
rival centres.

A total of 133 companies was surveyed – 54 banks and 79 independent
wealth managers.