Three years ago, Pictet’s partners decided they were ready for a breath of fresh air. With Boris Collardi, they got a tempest instead.
The star private banker’s 2018 debut in the 214-year-old private bank’s partner «salon» stood for a willingness to step into the limelight. The same year, Pictet underscored its ambitions by splashing out to rent a pricey historical Bahnhofstrasse landmark for its new Zurich offices.
The 105-year-old «Leuenhof» emerges from a gentle renovation by feted urban architect Tilla Theus later this year. Collardi is due to take up residence in a spacious wood-paneled office that was formerly the boardroom for Bank Leu.
His triumphal return to Bahnhofstrasse is overshadowed by increasing attention over his past at Julius Baer among Pictet’s six other partners as well as a cadre of older, influential ex-partners who still wield considerable, albeit informal, influence.
Specter of Banker Ban
The tipping point for the Pictet partners was an unusually aggressive tone from the Swiss supervisor, Finma. CEO Mark Branson raised the specter of Julius Baer’s management at the time being held responsible for lapses on fighting money laundering. Specifically, Collardi could be hit with a professional ban if Finma found evidence he was directly responsible, Branson acknowledged.
The partners wanted the fast-moving, decisive, energetic Collardi in 2017 because he meant more rigor to its growth strategy with win wealthy clients, «pull» power, and stellar connections. They also needed his expertise with U.S. prosecutors over hidden Swiss offshore accounts, a legal wound which looms for Pictet but which Julius Baer settled for $547 million four years ago. Pictet didn’t count on most of the baggage that has come with it.
Their main worry is for Pictet’s reputation and judgment in taking him on: the Swiss regulator’s sanctioning of Julius Baer for failing to properly fight money laundering overlaps almost exactly with Collardi’s eight-year tenure running that bank. The 45-year-old Collardi wasn’t accused of wrong-doing.
«Ancien» Frowing
Julius Baer’s Venezuelan scandal was well-known at Pictet when Collardi was hired. Nevertheless, for the risk-averse «ancien associé» like Charles Pictet, senior partner until 2004 and now on its board of directors, commingling the prestigious family brand with large-scale Venezuelan graft stings.
To be sure, Collardi passed a fitness and probity test before he moved to Pictet in mid-2018. By that time, Finma’s investigation at Julius Baer was in its second year. The bank had already started a clean-up under Collardi.
However, the nearly $100 million, three-year scouring of all its accounts didn’t kick into high gear until Finma investigators got involved. Five months after Collardi entered Pictet’s «salon» for the first time, one of his former top bankers at Julius Baer, Matthias Krull, sobbed as he was sentenced to a ten-year prison term by a judge in Miami.
Blue-Blooded Clans
The scandal has also laid bare that Collardi hasn’t truly arrived at Pictet yet. Three elite Genevan family strands dominate the partnership: the Pictets, the de Saussures, and the Demoles, who have stood several senior partners in recent years.
Collardi is a full, executive partner of Pictet, and has less to fear from his six co-partners, one person familiar with the bank’s ownership said. The older, retired partners, some of whom likely still hold capital in the bank’s parent company, command soft power when it comes to deciding Collardi’s fate, according to this person.
Brash vs Low-Key
Even before the extent of Julius Baer’s involvement in money laundering during Collardi’s tenure was known, the banker’s confident, brash ways rankled in low-key Geneva. He poached dozens of bankers from his old ship over to Pictet – the conservative wealth manager bristled at what it perceived to be rough-edged hiring methods.
It is too early to tell whether high-profile Pictet hires like Middle East head Samam Habibian can flourish under the Genevan bank’s system, which lends funds far more reluctantly than Julius Baer did and does.
