Volatile markets strongly affected Lombard Odier's business last year. Profit rose while assets under management declined. Patrick Odier told finews.asia how his bank planned to recruit new people.
Lombard Odier had a profit of 272 million Swiss francs ($272 million) in 2018, up from 146 million in 2017, the company said in a statement on Monday. Profit was boosted by one-time items, such as the divestment of five properties and its Dutch wealth management unit.
Excluding one-time items, profit amounted to 165 million francs. Operating income in 2018 increased 6 percent to 1.2 billion francs.
Volatility Hurt Assets Under Management
Lombard Odier’s business was driven by an increase in client activity amid a challenging market environment. The volatility on the markets wiped out 19 billion francs and assets under management fell to 259 billion francs as a consequence.
Patrick Odier (pictured above), the senior managing partner at the Geneva-based bank, told finews.asia that the decline in client assets had already been made up for in the first months of 2019.
Long-Term Perspective
The portfolio management had been caught on the wrong foot by the difficult markets in 2018. «Our investment perspective is always long term and this year we will put great emphasis on mastering the persistent volatility,» Odier said.
Net new money in wealth management amounted to 4 billion francs, a «robust» figure. This applied mostly to the first half of the year, when it received 3 billion francs, while the second half yielded 1 billion.
Changes in Asset Management
In asset management, Lombard Odier had a flat development of net new money. «We are currently investing in the establishment of new asset strategies, in particular in the segment of sustainable investments,» Odier said. «Older and less profitable strategies have been given up. This contributed to the flat development of net new money.»
In general, Odier sees no need to move away from the tried and tested conservative business strategy of the firm, which is now 223 years old. The bank aims to grow and it will invest more money, and also plans to hire more people. Lombard Odier recently appointed Alexandre Zeller as a new partner.
No Aggressive Hiring Planned
The bank won’t, however, adopt the same strategy as Geneva rival Pictet, which is targeting entire teams to generate critical mass in specific markets quickly. Last year, Pictet hired a Middle East team from Julius Baer.
«We are pursuing an organic growth strategy, and aggressive recruitment isn’t part of this,» said Odier. «It is important to us to attract the right talent, which will adopt the culture of Lombard Odier and represent it.»
