A tie-up with fintech firm Move Digital, which is meant to be building a robo-adviser and a multi-custody platform, appears to be on hold (the bank said it is currently evaluating the project). Falcon apparently hasn't followed up on funding promises.
By contrast, Falcon's crypto desk is still seeing client demand, but the main players behind the push like trading boss Sauter and Arthur Vayloyan have fled. As a result, Falcon's development in the burgeoning asset class has stalled, as the crypto world moves forward in leaps and bounds.
Thus, the bank is at risk of losing its most distinguishing characteristic, as other wealth managers prepare to move in on cryptocurrencies and digital tokens.
3. What Strategy?
CEO Keller was blunt with finews.com last year: Falcon's reinvention as a digital wealth and crypto asset manager is an attempt to break with its scandal-tarnished past. The bank has managed to break free of the 1MDB scandal, but its future is clear as mud.
First, the bank is still struggling under regulatory risks from the 1MDB affair, which remain hurdles both strategically as well as in winning new clients. Switzerland's prosecutor has also been investigating the bank and former executives for the past 18 months.
Falcon's Abu Dhabi owners are also increasingly represent a burden of uncertainty. To be sure, the oil-rich emirate city has backed Falcon recently and ensured its support. But shortly before the backing, Abu Dhabi wrong-footed Falcon's Zurich-based management and board by opening the bank's books to Luxembourg's Banque Havilland, which had indicated an interest in acquiring.
The bank has been in limbo since at least then, as a Falcon banker puts it. «It's true that we are evaluating all strategic projects and focusing on blockchain and crypto,» a spokesman for the bank said. The bank's approach will remain unchanged, he emphasized, but management and board will provide more details later this month.
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