Late last year Credit Suisse had an identity crisis. Facing profitability shortfalls and capital concerns – along with all the other stuff that being Credit Suisse entails – CEO Tidjane Thiam raised the possibility of spinning and/or selling off a chunk of the lender's “crown jewel,” the vaunted Swiss bank. Thankfully (formost), the outlook improved and Credit Suisse came to the conclusion that it might as well hold onto the universal bank unit that makes Credit Suisse Swiss.
Now that that unpleasantness is in the rear-view window, the bank has decided that if it's going to remain true to its alpine roots, it might as well go whole hog:
Credit Suisse Group AG established a new unit catering to institutional clients and the ultra rich at its Swiss universal bank after abandoning plans for an initial public offering of the division earlier this year. The investment advisory & solutions unit will provide “customized investment solutions and services to institutional clients, [ultra-high net worth individuals] clients and family offices,” the bank said in a statement on Tuesday.
It's no mystery why Credit Suisse would conclude that now is as good a time as any to dedicate an entire unit to those who have amassed, at a minimum, $50 million in household wealth. According to the bank's own global wealth report, the UHNWI has grown 216% since 2000, “by far the fastest-growing group of wealth-holders.” And with an increasing share of zillionaires hailing from emerging economies, there's clearly going to be a growing market in the business of moving ungodly stacks of cash around.
But why would the ultra-wealthy want to bank in Switzerland these days? Certainly not for tax evasion – that's just not what the Swiss do anymore! But the Swiss certainly have expertise, and a reputation. And that's gotta be worth something, right?