For the past six months, a battle has been raging within the Rothschild family business empire. The dispute is about the all-important right to use the family name in business. Switzerland is playing a central role in this feud.

Because a large part of the two enemy family groups are either domiciled in Switzerland or work from here, the Swiss have a particular interest in the case. But what is really going on?

Last April the Franco-British branch of the Rothschild family under David de Rothschild announced it was going to rename Paris Orléans holding company Rothschild & Co.

De Rothschild brought together the French and British sides of the banking dynasty in 2012 under Paris Orléans and claimed the new name would better reflect the business.

Fear of confusion

The news was not well received by Benjamin de Rothschild in Geneva who runs the Edmond de Rothschild Group bank, named after his father, which is also quoted on the Swiss stock exchange.

Because both sides have adopted an intransigent position and the family has entered a state of war since last week when Paris Orléans shareholders voted to change the company’s name with immediate effect.

The Geneva-based Rothschild bank immediately announced that it would strongly contest the renaming of Paris Orléans. The Edmond de Rothschild Group released a statement saying the name change would cause unnecessary confusion and is “tantamount to appropriating the use of the Rothschild family name”.

Hardened fronts

The irony is that the Geneva Edmond de Rothschild Group is also a shareholder in the company formerly known as Paris Orléans, holding almost eight per cent. Meanwhile, Paris Orléans under its new name Rothschild & Co. owns 8.4 per cent of the Edmond de Rothschild Group.
In fact several different members of the Rothschild family are active in the financial world.

First and foremost David de Rothschild, who brought together the British and French operations under Paris Orléans. In London the company is mostly active in investment and merchant banking, but also – especially through its subsidiary in Zurich – in asset management, as reported by finews.ch (article in German).

Father’s inheritance

In the last fiscal year the business had revenues of some 1.4 billion euro. Alexandre de Rothschild, David’s son, also works for the group and is expected to see through the generation handover in the next few years. Against this background it is obviously important that the business is known under his real name and not under the more cumbersome Paris Orléans.

Benjamin de Rothschild, who lives near Geneva and took over the Edmond de Rothschild Group after the death of his uncle in the 1990s, does not accept this argument. The institution is quoted on the Swiss stock exchange but attracts little publicity.

Organizational changes

Under the leadership of Claude Messulam, the bank carried out far-reaching organizational changes in recent years, from which Benjamin’s wife Ariane de Rothschild gained a leading role today – as board member and patron. The bank manages some 140 billion in client funds.

Other members of the Rothschild family who are active in the finance industry include Jacob Rothschild. After leaving the then NM Rothschild, Jacob founded the successful investment firm RIT Capital Partners, quoted on the London stock exchange since 1988. Jacob’s son Nathaniel ‘Nat’ de Rothschild is also active in the sector, through his hedge fund, as well as in the energy industry.

The Economist connection

Evelyn de Rothschild has played a central role in the Franco-British Rothschild Group (alongside David de Rothschild), before he (Evelyn) founded the investment firm E.L. Rothschild in 2003 with his third wife Lynn Forester.

Through this firm he is also involved in the Economist Group that publishes the magazine of the same name. Lynn Forester is increasingly active through the Coalition for Inclusive Capitalism, an organization that campaigns for moderate inclusive economic development.

Fallout for Switzerland

The dispute between the two Rothschild Groups is also having an impact in Switzerland. The two institutions that liked to refer to themselves as cousins in the past are now locked in direct confrontation.

One result is that the Geneva bank significantly increased its head count in Zurich, entering into direct competition with their relatives.
The Zurich Rothschild bank has had a presence for years in Geneva but is currently actively expanding this location (article in German), under the leadership of Laurent Gagnebin, son of the well-known bank manager (article in German) George Gagnebin.

This intrusion will hardly be welcomed by Benjamin de Rothschild, who has said he will do everything possible to block the renaming of Paris Orléans.