Zurich-based wealth advisor Zwei Wealth has published a quality rating for hundreds of Swiss banks and asset managers for the first time. Scores range from insufficient to very good. finews.com looks to see who came out ahead.

It's a «beauty contest» in which the candidates wear pinstripes instead of bikinis. Since its founding nine years ago, Zurich-based wealth advisor Zwei Wealth has been looking for suitable money managers for its wealthy clients.

What began as a round of interviews in the offices of the company founded by former UBS bankers Klaus Wellershoff and Patrick Mueller (pictured below) has expanded to a cohort of over 500 affiliated asset managers, banks, and other service providers.

Broadly Accessible

They look to bring wealthy clients into the fold via the digitized «Wealth Office» platform, which now has assets of more than six billion Swiss francs ($6.7 billion), according to Zwei Wealth.

Since August, this beauty contest has been enriched by the auxiliary function of «Provider Rating» intended to provide an independent seal of approval for the portfolio management of an asset manager or a bank, and accessible to a broad audience for the first time.

Co-founders Patrick Müller und Klaus Wellershoff (Image: Zwei Wealth)

Rule-Based Assessment

Under the title «How good is your asset management?», are ratings for banks and asset managers that can be ordered online free of charge. The assessment is based on a methodology developed over the past eight years.

There are seven rule-based seven criteria, including the structure of a provider, assets under management, employees, and quality of service. The results give insights into the stability, experience, specialization, and track record of more than 300 banks and asset managers.

Over 300 Ratings

The provider rating enables more transparency and competition in wealth management, according to Zwei Wealth. The seal of approval is also used by the wealth advisor for things like investment monitoring mandates and in-audit reports.

Who performs best in this rating, which focuses on Swiss asset management? How do the providers feel about their rating? finews.com took a look at the ratings and spoke to some of the firms. Although the winner of all classes cannot be determined, Zwei-Wealth CEO Mueller says «We deliberately don't do a ranking in that sense, because there's no such thing as the best.»

From Recommendable to Very Good

The ratings range from an «insufficient» provider rating of 1 to a «very good» maximum of 5. In April, most providers achieved a rating of 3.2 and 3.3. A selection of small, medium, and large providers, all of which performed well to very well, have shared their results with finews.com:

  • Geneva-based fund house Unigestion (provider rating 3.6; rating «very good»)
  • Geneva private bank Lombard Odier (3.5; «good»)
  • Bern asset manager OLZ (3.5; «good»)
  • Independent asset manager Diem Client Partner (3.5; «good»)
  • Private bank Schroder & Co in Zurich (3.4; «good»)
  • Frankfurter Bankgesellschaft (Switzerland) (3.2; «recommendable»)

Ambition to be the Best

As expected, the assessment was well received by this group. Schroders & Co Switzerland CEO Adrian Noesberger said he considers the procedure to be objective with the assessment based on clear criteria.

Sascha Peier, head of Diem Client Partner, also gave the process high marks, saying «We're satisfied with the initial rating, but at the same time we're glad there's still room for improvement.» His company's motivation is to be clearly among the best in the relevant segments.

Feedback Already Implemented

Whether anything can be learned from the ratings is another matter. According to Tobias Buetikofer, head of corporate development at OLZ, that's certainly the case. «The ranking shows us directly what customers are looking at and where we stand in relation to our competitors.» That's important information if you want to constantly improve.

Frankfurter Bankgesellschaft in Zurich used the feedback to make appropriate changes and will continue to do so, explains Christian Gruetter, head of Private Banking.

A Model for the Future?

Expectations of the benefits for a bank's sales force are still divided. Diem Client Partners' Peier is very positive. For him, Zwei Wealth's platform represents a successful model for the future. «We're fully committed to partner platforms and models for distribution.»

Harel van Dijk, responsible for private market investments at Unigestion, is more skeptical. The rating has only just been launched and there is still little experience available, arguing the Zwei Wealth platform isn't of great importance for distribution yet.