Disenchanted clients of Swiss banks are pushing back against what they perceive as fee-gouging. This presents an opportunity for smaller shops, former private banker Marcel Chevrolet tells finews.com.
Marcel Chevrolet, what's wrong with the relationship between clients and their banks?
Quite simply, banks never represent the client's interests, but instead their own. The banking system is so bonus-driven that only short-term success counts. This is passed on to clients in the form of high fees. Someone has to pay the million-franc bonuses.
Clients can be inept in their understanding of financial investments, but they are not dim and they will fight back against banks gouging them. As a result, many clients forgo the management of their assets through a bank altogether and do nothing instead.
«Only did four transactions in the last year. And that's fine.»
My clients benefit from my simple and completely unspectacular dividend strategy, which targets long-term success. In the last 12 months, I only carried out four transactions on behalf of my clients. And that was fine.
What more can you offer thanks a bank can?
Back to the roots! Long-term capital investments with mainly Swiss dividend stocks and solid growth is my offering. No panicked in and out of the market, just a long-term strategy. No funds, no structured products, occasionally an exchange-traded fund (ETF). I work with the custodian bank with the lowest fees and complete transparency.
«Clients need not get nervous when a stock has a bad year»
Nevertheless, I'm in very close contact with my clients, and they are well informed and know the strategy. They don't get nervous if stocks like Zurich Insurance or Swatch tumble by 30 percent, like last year. They know that these stocks will recover.
But you're just one person. Isn't that risky?
Yes, I am a lone wolf, but I'm available anytime and even have my business infrastructure with me on holiday. I've never been in the situation where I need a deputy because I don't do any trading.
I spent a few days in hospital, but none of my clients knew of my absence. You certainly need to be well-organized and lean, but I am open to cooperate with other wealth managers. It could be an interesting opportunity for unemployed bankers.
How do you want to develop your firm in the next few years?
Swiss finance is undergoing a structural transformation of epic proportions. The end of banking secrecy had led to huge outflows, and fewer offshore clients are coming to Switzerland.
Banks are attempting to cushion the effect through cost cuts, especially by letting go the 50-and-over generation, which will only work in the short term. The banking sector is going to shrink, and especially foreign players don't really have a reason to be here anymore. Thousands more employees will be let go.
«Milking it for as long as possible isn't sustainable»
On the other hand, CEOs and top management aren't prepared to relinquish their completely excessive salary and bonuses. «Milking it» as long as possible – the top cashes up while the bottom gets let go. Of course, this isn't sustainable.
What do you think needs to happen in banking?
There has to be a huge shift in thinking. The banking sector will only stabilize after the last swindlers are gone and a new generation of more credible executives has established itself. Switzerland offers excellent infrastructure, even without banking secrecy. We need to return to our old virtues.
What about you personally?
I'm very optimistic for my firm because I'm set up very lean and flexible. I'm diversified into different areas, and I'm using my experience to help clients. That's the key to success.
Marcel Chevrolet is a Swiss wealth manager who has been self-employed since May 2014, specialized in occupational pension benefits. Previously, he was a client advisor and member of management at various firms in Switzerland including UBS, Sarasin, BNP Paribas, EFG International und Commerzbank (Switzerland).
