Lombard Odier has seen strong inflows of client assets in 2019 and increased its profit. Its success is based on a strategy of sustainable investments and cooperation, said Senior Partner Patrick Odier told finews.com.
Client assets at Lombard Odier rose 16 percent to 299 billion Swiss francs ($308 billion) in 2019, according to a statement released by the Geneva-based private bank on Thursday. The rate of growth was in line with its closest local rival Pictet, where assets also increased by 16 percent.
But while profit had dropped slightly at Pictet, Lombard Odier today reported an increase of 6 percent to 175 million francs.
Investing in Bankers
With one-time items, net income actually had reached 203 million francs. The sale of a client book in North America to Vontobel and an extra dividend by stock exchange operator SIX were among items that added an additional 28 million francs to its net.
Lombard Odier didn’t hold back on investments in 2019, Patrick Odier (pictured below) told finews.com. «We have kept investing in relationship managers as well as investment knowhow and technology and at the same time retained a strict cost control. This has manifest itself in the increase in profit.»
14 Billion Francs in Net New Money
Two thirds of the growth in assets under management is attributable to the performance of the financial markets in general, but Lombard Odier also attracted 14 billion francs in net new money. The 224-year old bank is managing 182 billion francs for individual clients and 49 billion francs for institutional clients.
The development goes to show that private banking is growing faster than the bank’s asset management division. Back in 2017, Lombard Odier had managed 125 billion francs in the private clients’ unit, while it already had 46 billion in investment management.
Trademark Sustainability
The division between wealth and asset management is evaporating though, a trend that has also reached rival Vontobel in Zurich. The Geneva-based bank has had its focus set on investment management and client performance for years.
«It allows us to understand existing investment trends and to implement those in favor of our clients. The best example for this is the focus on sustainable investments, the trademark of Lombard Odier,» said the senior partner of the bank.
Cooperation in Mexico
Lombard Odier is also at the forefront of a further industry trend: co-operations. The bank has strongly relied on partners in Asia to expand into new markets, as for instance in the Philippines.
But this strategy isn’t confined to a specific region. Co-operations are also an option for the business in the Middle East, even as the bank recently opted to go it alone in Abu Dhabi.
In Mexico, Lombard Odier recently signed an agreement with Grupo Financiero Banorte to launch a fund for the local market. A strategy that has been successfully tested in the region.
Further Deals
In Switzerland, Lombard Odier and Credit Suisse also recently agreed to merge two funds. «The recent co-operations in Mexico and the partnership with Credit Suisse in the area of sustainability shows that we continue to focus on this strategy and keep looking for further partners,» said the senior partner.
