Edmond de Rothschild plans to double assets in deals push
President Ariane de Rothschild sets out ambitions as Amundi’s chair Yves Perrier joins board
Edmond de Rothschild Group plans to double its assets under management and capitalise on the fallout from scandals such as Greensill Capital that ensnared wealthy investors, according to the firm’s president Ariane de Rothschild.
After several years of restructuring and upheaval, the Franco-Swiss private bank and asset manager is targeting acquisitions to help double its assets from the current SFr175bn ($194bn).
“We are looking at buying asset managers and private banks, or hiring smaller teams,” de Rothschild told the Financial Times in a rare interview. “The industry is fragmented with lots of smaller players out there and I think it’s important to try to consolidate. I would expect that we double the size of our assets under management in the next five years.”
De Rothschild oversees a family business that was created in 1953 by her father-in-law, Edmond de Rothschild, and encompasses wealth management, corporate finance, private equity and property. Over the past two years, Edmond de Rothschild Group consolidated all of its operations under the Swiss bank, which it then took private.
“We are starting to look at Asian markets and developing our presence in the Middle East,” said de Rothschild. “Within asset management our bias is towards private equity, real estate and infrastructure,” reflecting investors’ hunt for yield in a low-interest rate environment.
Last year, Edmond de Rothschild Group’s assets dropped 3 per cent to SFr168bn, mainly because of unfavourable currency moves, but had bounced to SFr175bn by the end of the first quarter. For 2020, its net income climbed to SFr57m, up 4 per cent from 2019.
The financial services arm of the group faces a tough environment as Switzerland has lost its prized banking secrecy, while tighter regulations and low interest rates are squeezing fees.
In January, de Rothschild’s husband, Benjamin de Rothschild, died of a heart attack at the age of 57. He had already stepped back from the day-to-day running of the financial business that he inherited from his father, and was chair of the group’s holding company and focused on the family’s sailing sponsorships.
The family’s non-financial businesses include philanthropic projects, the Four Seasons Hotel Megève, the Gitana fleet of racing boats, and its famous vineyards stretching from Argentina to New Zealand.
Edmond de Rothschild Group is also looking to take advantage of its low-risk approach to lure wealthy private clients, including those caught up in recent scandals such as the implosion of supply chain financing company Greensill.
More than 1,000 Credit Suisse customers, among them ultra-wealthy individuals in Europe and Asia who invested in the $10bn range of funds tied to Greensill, face losses.
“We, by definition, are low risk because it’s my duty to protect my clients’ money and it’s my duty to protect my family’s money,” said de Rothschild, declining to comment on Credit Suisse specifically.
“Some of these high-profile recent cases reflect a lack of risk control or too high a risk appetite,” she added. “These types of blow-ups are regrettable overall for the financial industry because they give a really bad view of what it is about. Clients are highly sensitive to reputational risk.”
De Rothschild was speaking as the Edmond de Rothschild Group announced a series of changes to its top ranks.
Yves Perrier, a renowned dealmaker who built Amundi into the largest asset manager in Europe, will join its group and holding company board as a director next month. Perrier stepped down as chief executive of Amundi last week and became chair of the €1.7tn French group’s board.
Meanwhile, Cynthia Tobiano, currently deputy chief executive of Edmond de Rothschild Group, will become chief executive of the group holding company and oversee all the family’s activities from the end of this year.
Meanwhile, Vincent Taupin, chief executive of Edmond de Rothschild Group since April 2019, is retiring and will be replaced by François Pauly, who has been a non-executive director of the group for the past five years.