A Huge Legacy
The reason for this is a development that is unpleasant news for the banks. The ultra-rich clients increasingly are using own networks for their transaction – leaving their bank aside, for which the investment bank thus becomes a hugely expensive disadvantage.
Josef Stadler, head of the UHNW business at UBS, made it plain in autumn what he thought was the problem: the tightly regulated banks have become far to slow and cumbersome for the most demanding clients who wanted to make investments in the private market. He added that suddenly, the bank had no business.
Mere Asset Service Providers
The identical strategies of UBS and Credit Suisse – providing the service of their investment banks for billionaires to make complex investments and deals – isn’t working because deal flow is simply too thin.
UBS and Credit Suisse are mainly used as asset service providers and custodians by the richest of their clients – and certainly not the one-stop shop for holistic advice and complex investment plans.
The question is whether the focus of UBS and Credit Suisse on the rich and billionaires mainly serves as an excuse to maintain such big investment banks.
