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A reputation in tatters, mounting losses, staff that are taking their leave and most recently rumors of an impending sale of the company: Falcon Private Bank can only really save itself.

To describe the state of Swiss-based Falcon Private Bank after its disastrous involvement in the 1MDB scandal – with the alleged massive fraud at the Malaysian state fund – it suffices to mention two figures: 128 million and 28 million Swiss francs. These are the losses which the small bank in Zurich owned by the Abu Dhabi state fund accrued in the past two business years.

The loss in 2016 was mainly a consequence of the liquidation of trading positions and investments. Last year's result however was largely due to the highly ambitious strategy of Eduardo Leemann and Walter Berchtold, the bank's ex-bosses.

Struggling With Costs

The 2017 Falcon earnings report, which is in the possession of finews.asia, shows how the institute is struggling with a cost base way above its earning capacity.

It isn't clear whether the potential buyer, which was reported about last week, was turned off by the need to restructure the bank. However, research by finews.asia revealed that the interest in acquiring Falcon was for real – and the suitor being Luxembourg-based Banque Havilland, which is also active in Switzerland.

Management and Board Kept in the Dark