Hubert Keller took on the top position at Lombard Odier at the beginning of the year. If he does his job well, no one will notice the change in leadership, the private bank’s senior managing partner told finews.asia in an interview.
Last year left its mark on Lombard Odier's profits and assets under management. Now that stock market conditions have improved, the group should have had a brilliant start to 2023. Is this the case?
It is true that markets developed favorably, at least last January. We are now cautiously optimistic for the next 18 to 24 months, although I would emphasize the word cautious. We expect central bank policy to remain tight in 2023, which should make for volatile stock markets.
Since the beginning of the year, you have become the leading managing partner among Lombard Odier’s highest-ranking partners. Where will you make your mark at the company?
Our governance model is a partnership in which our six managing partners jointly own and lead the bank.
«We are not concerned with how, but with what»
We make our decisions unanimously. As the senior partner, I am responsible for facilitating decision-making in the partner body. In addition, I will increasingly represent the group to the outside world.
But every leader brings his or her own style, don't they?
(laughs) I hope my style is the Lombard-Odier style! I've been a managing partner for 17 years now, so I'm very familiar with the culture and values of the bank. If I do my job well, no one will notice the change in leadership. A personal concern of mine is sustainability, which is already an integral part of Lombard Odier's strategy. I will also act as its ambassador in the future.
The sustainability movement within the financial sector has suffered some setbacks recently- asset management giants like the US fund house Vanguard are saying goodbye to climate alliances or reeling in their commitment. Do you sense this at Lombard Odier?
Not at all. We have clearly defined what sustainability means to us: performance, performance, performance, and more performance! Moreover, we are not concerned with how - that is the core of the current ESG discussion - but rather with what companies are doing to take advantage of the enormous new profit opportunities arising from environmental change.
«When our clients' funds do well, we do well»
We are good at communicating both messages to our customers, and we are investing heavily in the issue. Even during the difficult environment last year, we launched three new funds.
The group registered around 3 billion Swiss francs ($3.2 billion) in new money in 2022, measured against 300 billion francs in client assets. Are you satisfied with that?
Our strategy includes four priorities: In addition to offering sustainable products, expanding in private market investments and investing in our technology platform, this is organic growth.
The new money we attract from existing and new customers is of central importance to us. Here we have recorded respectable figures in recent years.
Lombard Odier's earning power is very dependent on its assets under management, which proved to be an Achilles' heel for you in 2022. Are you comfortable with this dependency?
We have chosen to operate a focused business model. We want to make our money primarily by advising and managing our clients' assets. This leads to a harmonization of interests - if our clientele's money does well, we do well too. Lombard Odier's more than 200-year history tells us that this business model works.
You are a representative of asset management. Will this become more important at Lombard Odier in the future?
We do not break down the revenues of the institutional and private client businesses separately. However, the approaches to growth are different. While in Private Banking we are growing primarily through the acquisition of more client assets, in Asset Management the launch of new products, the scaling of existing offerings and the addition of new clients offer opportunities for growth.
Is Lombard Odier becoming an investment house, as Vontobel in Zurich claims to be?
Investments have been our raison d'être since we were founded in 1796.
« Whether more advisors will join us from Credit Suisse remains to be seen»
Which is why we see ourselves as an investment house. However private banking and asset management have been our two main pillars for decades. We want to stick to this model.
Several private bankers joined from your ailing competitor Credit Suisse. Are more of their former colleagues expected to follow?
I would like to state that the current situation at Credit Suisse is neither beneficial for its employees, its clients, nor for the Swiss banking center.
«In Asia, we want to gain a foothold in the respective home markets»
However, in such situations, clients and employees sometimes switch banks.Whether more advisors will join us from Credit Suisse remains to be seen.
Lombard Odier is not only expanding its reach in Switzerland but also in Asia. The Group recently entered into a partnership with the Japanese bank Mizuho. What is the rationale behind this?
In this region, we want to serve offshore clients as well as gain a foothold in the respective home markets. To this end, we are working with local partner banks - providing them with a comprehensive investment offering tailored to the needs of their domestic customers. We already have such partnerships in Thailand, the Philippines, Indonesia, Taiwan and now with Mizuho in Japan.
In January this year, Huber Keller became the sole senior managing partner of the Lombard Odier, after serving as a partner since 2006. Until 2020 he headed Lombard Odier Investment Managers (LOIM), the bank's fund arm As of the end of last year, the Geneva-based group managed client assets totaling 300 billion Swiss francs with 2,718 employees in 25 offices worldwide. In 2022, Lombard Odier posted a profit of 243 million francs, down 10 percent from the previous year.
