Question Private banking - 7/8 figures, white and safe

[JohnnyDoe]

I consider Rothschild (I mean Banque Privee Edmond de Rothschild SA, Geneve) also recommendable.

Maybe, if they accept you. They quickly rejected my request for discussing an account opening.

In Liechtenstein, I would consider Liechtensteinische Landesbank and LGT. And generally, some diversification is necessary, IMO.

Yes LGT is good, also the Austrian branch if you like the EU

Cité Gestion can open accounts with other banks for you.

 

[Forester]

if you like the EU

Not at all – but perhaps it can be more easy to open with LGT AU? (No info, just guessing.)

Cité Gestion can open accounts with other banks for you.

If it is still so (yes, it's fully understandable, they are originally asset managers), it's really useful. Thanks for pointing at it.

 

[wheelspin]

understand, @JohnnyDoe. Personally I would avoid Credit Suisse (frankly, I do not think it is dangerous to have there some assets; but I do not liked the way how they served the clients, not at all). UBS is OK and Cité Gestion is relatively new – but why not. For 7-8 figures I consider Rothschild (I mean Banque Privee Edmond de Rothschild SA, Geneve) also recommendable. In Liechtenstein, I would consider Liechtensteinische Landesbank and LGT. And generally, some diversification is necessary, IMO.

Are UBS / CS and LGT ok with only self-directed accounted even at large sums or do they force you to buy their mediocre mutual funds?

In 2019 UBS insisted that people buy there products or they would charge 10x the fees for foreigners. IMHO prices in Switzerland are more competitive than before.

I question myself whether there's any benefit using Switzerland as a broker compared to Singapore or Liechtenstein?

 

[JohnnyDoe]

Not at all – but perhaps it can be more easy to open with LGT AU? (No info, just guessing.)

Correct

If it is still so (yes, it's fully understandable, they are originally asset managers), it's really useful. Thanks for pointing at it.

Yes they do that and the money goes to the other banks’ books, while you keep controlling it through CG

Are UBS / CS and LGT ok with only self-directed accounted even at large sums or do they force you to buy their mediocre mutual funds?

They don’t force you to do anything but you need to bring some business, also outside their mutual funds. For example UBS has interesting real estate deals.

In 2019 UBS insisted that people buy there products or they would charge 10x the fees for foreigners. IMHO prices in Switzerland are more competitive than before.

Sometimes you just need to buy a random low risk fund as an entry ticket for more interesting products.

I question myself whether there's any benefit using Switzerland as a broker compared to Singapore or Liechtenstein?

None that I could think of, apart from the easier accessibility.

 

[Forester]

Yes they do that and the money goes to the other banks’ books, while you keep controlling it through CG

Fully understandable – and nice. Simply, they are still able to run as real wealth managers.

They don’t force you to do anything

I know about negative experience with CS – perhaps it cannot be called forcing but continuous unsolicited offering and offering and offering...

but you need to bring some business,

Fully understandable (and acceptable), in general.

I question myself whether there's any benefit using Switzerland as a broker compared to Singapore or Liechtenstein?

I cannot judge re: Singapore. CH and LI I consider to be comparable, some pros, come cons. (CH I consider to be more robust /geopolitically/, LI is more protective /no foreign court rulings acknowledged/.)

 

[backpacker]

I cannot judge re: Singapore

I would not recommend Singapore for anything more than pocket change.
If it comes to any sort of legal dispute you, as a foreigner, will always be at the loosing end.
Aside form the above I find proceedings over there very bureaucratic, stubborn and inefficent. A bit similar to all these COVID measures SG had for far too long.
Btw., a perfect example of Singaporean mind-set is this -> Exclusive: Singapore banks report tax amnesty Indonesians to police

SG banking:
Either you go with a private bank, pay about the same fees as everywhere else but will be settled with very unattractive prices when dealing in non-local bonds.
If you want to something on the stock market, most private banks do not offer a well-thought trading platform which means you are better off to split between banking and brokerage. That means a lot of bureaucracy because both, broker and bank, do KYC separately, even though it might the very same financial institution.

 

[wheelspin]

I would not recommend Singapore for anything more than pocket change.
If it comes to any sort of legal dispute you, as a foreigner, will always be at the loosing end.
Aside form the above I find proceedings over there very bureaucratic, stubborn and inefficent. A bit similar to all these COVID measures SG had for far too long.
Btw., a perfect example of Singaporean mind-set is this -> Exclusive: Singapore banks report tax amnesty Indonesians to police

SG banking:
Either you go with a private bank, pay about the same fees as everywhere else but will be settled with very unattractive prices when dealing in non-local bonds.
If you want to something on the stock market, most private banks do not offer a well-thought trading platform which means you are better off to split between banking and brokerage. That means a lot of bureaucracy because both, broker and bank, do KYC separately, even though it might the very same financial institution.

For investing purposes into the usual stock market I recommend SC SG. I haven't had an issue to open a private bank account as priority banking client with them (no wealth management though). Can't speak for business matters.

 

[Meta]

They don’t force you to do anything but you need to bring some business, also outside their mutual funds. For example UBS has interesting real estate deals.

Once I was planning to open an account with a private bank in Switzerland. It was mostly related to one specific deal that they could help with. The manager was pitching their wealth management solutions and how they would discretionary buy all kinds of weird financial products using my money... I clearly indicated that I was not interested and was quite happy with my boring index funds portfolio that I rebalance once a year and don't want to pay a lot of fees. The manager was very straight: "Then we can just take 0.8% of what you hold with us yearly + nominal trade fees and leave you alone". I appreciated that. It's expensive as we are talking about 7-figures (I am not used to this negative rates yet...), but well, one got to pay for service.

The deal didn't go through though and I didn't open an account there.
Could you (or anybody with first-hands experience) please advise: is it typical to settle on arrangement like "I pay you circa 1% of AUM, but not really interested in you managing them actively, certainly don't want sales pitches regarding your expensive private funds" or it's not enough?

 

[wheelspin]

Could you (or anybody with first-hands experience) please advise: is it typical to settle on arrangement like "I pay you circa 1% of AUM, but not really interested in you managing them actively, certainly don't want sales pitches regarding your expensive private funds" or it's not enough?

no it is not. Switzerland is loosing more and more in wealth management and got competitive rates nowadays (that is what I've heard). I'll drop UBS, BGL BNP, Pictet, VP Bank and LGT Bank a mail to find out their willingness to help me. I've done extensive research about their funds and products and, even only preserving wealth, there's only one hand of funds I would ever invest in. I hope they can come up with good fee structure for advisory or execution only or something like a flat fee for my special needs. Paying 1% AUM for just holding the assets is nonsense.

 

[Jerry1911]

I clearly indicated that I was not interested and was quite happy with my boring index funds portfolio that I rebalance once a year and don't want to pay a lot of fees.

Umm... why not just go with IBKR and the likes?

 

[Meta]

no it is not. Switzerland is loosing more and more in wealth management and got competitive rates nowadays (that is what I've heard). I'll drop UBS, BGL BNP, Pictet, VP Bank and LGT Bank a mail to find out their willingness to help me. I've done extensive research about their funds and products and, even only preserving wealth, there's only one hand of funds I would ever invest in. I hope they can come up with good fee structure for advisory or execution only or something like a flat fee for my special needs. Paying 1% AUM for just holding the assets is nonsense.

Uhm, excuse me? You say that paying 1% is not enough for the banks and then say that 1% is too much. We got confused here.
Would love to know the results of your research though. Please post what offers you got! Wish you to find something reasonable.

Umm... why not just go with IBKR and the likes?

I do for my passive index funds actually. I don't need any additional services for that and Interactive Brokers is as cheap as you can get. Though I do need good service from a bank, so now evaluating if some private bank is worth it.

 

[Fred]

I do for my passive index funds actually. I don't need any additional services for that and Interactive Brokers is as cheap as you can get. Though I do need good service from a bank, so now evaluating if some private bank is worth it.

If you actually deal with IBKR and looking for something more regulated like a bank the logical step would be looking into something like Swissquote or Saxobank where you still enjoy reasonable fees but having a fully regulated bank which comes along with all the benefits.

Dealt with so many guys as of today and never met a single one who was happy with switching from IBKR to a Private Bank - including me.

You need to have very "specific" needs or you need to be a very high risk individual that a Private Bank with all the charges is really worth it - here is an example from one of my fellow Germans:

https://insideparadeplatz.ch/2022/03/15/mirabaud-zuerich-war-privatbank-des-wirecard-chefs/
I doubt Markus Braun cared about paying some $$$ or % while getting a 25m$ loan for worthless Wirecard Stocks and rumours already back in the days.

 

[Forester]

Could you (or anybody with first-hands experience) please advise: is it typical to settle on arrangement like "I pay you circa 1% of AUM, but not really interested in you managing them actively, certainly don't want sales pitches regarding your expensive private funds" or it's not enough?

no it is not. Switzerland is loosing more and more in wealth management and got competitive rates nowadays (that is what I've heard). I'll drop UBS, BGL BNP, Pictet, VP Bank and LGT Bank a mail to find out their willingness to help me. I've done extensive research about their funds and products and, even only preserving wealth, there's only one hand of funds I would ever invest in. I hope they can come up with good fee structure for advisory or execution only or something like a flat fee for my special needs. Paying 1% AUM for just holding the assets is nonsense.

As per my experience, paying 1% AUM for just holding the assets is really nonsense. You can expect better rates, say (roughly) a half of it.

Umm... why not just go with IBKR and the likes?

See this post Diversifying securities across multiple brokers and jurisdictions (personal wealth) . To quote/rephrase (I agree with @Martin Everson on it), it's a good idea to use discount brokers like IBKR for wealth planning if and only if you are able to trade by yourself, you are actively trading and don't have a buy and hold strategy. (So, not applicable to anyone.)

I do for my passive index funds actually. I don't need any additional services for that and Interactive Brokers is as cheap as you can get.

See above.

Though I do need good service from a bank, so now evaluating if some private bank is worth it.

What do you mean by “I do need good service from a bank”? What particular services do you need? Holding the assets, asset management, loans, credit cards, a safe box, (etc.) ...? The answer fundamentally depends on it.

If you actually deal with IBKR and looking for something more regulated like a bank the logical step would be looking into something like Swissquote or Saxobank where you still enjoy reasonable fees but having a fully regulated bank which comes along with all the benefits.

Good idea, IMO.

You need to have very "specific" needs or you need to be a very high risk individual that a Private Bank with all the charges is really worth it - here is an example from one of my fellow Germans:

https://insideparadeplatz.ch/2022/03/15/mirabaud-zuerich-war-privatbank-des-wirecard-chefs/
I doubt Markus Braun cared about paying some $$$ or % while getting a 25m$ loan for worthless Wirecard Stocks and rumours already back in the days.

Well, not all private banks are the same . But if we are talking just about asset management, then yes, if someone is able to trade independently, in many cases the private bank is not an optimal solution for him.

 

[Meta]

As per my experience, paying 1% AUM for just holding the assets is really nonsense. You can expect better rates, say (roughly) a half of it.

And a typical private bank would be alright getting their share and not trying to upsell their funds in your experience? That's useful information, thank you!

I don't quite get this comparison of a brokerage firm and a bank. Especially in terms of "more regulated" etc. They are just plain different things.

My question is of a typical fees schedule / arrangements in private banking. Discussing "what is a good service from a bank" would be off-topic. Will be grateful if somebody adds his experience. Regards.

 

[wheelspin]

Uhm, excuse me? You say that paying 1% is not enough for the banks and then say that 1% is too much. We got confused here.

He asked if it is typical to settle on arrangements at %1 - no it is not. So, no confusion here. 1% for AUM for execution only is way too much.

If you actually deal with IBKR and looking for something more regulated like a bank the logical step would be looking into something like Swissquote or Saxobank where you still enjoy reasonable fees but having a fully regulated bank which comes along with all the benefits.

Dealt with so many guys as of today and never met a single one who was happy with switching from IBKR to a Private Bank - including me.

Have you ever have hold 8 figures with SQ or Saxo?

 

[denniz07]

Have you ever have hold 8 figures with SQ or Saxo?

Is there any issues holding 8 figures with SQ or SAXO? I mean lets say you just want to invest in some ETF's.

Although been rejected by most private banks so far, the fees seem to be much to high (nearly 1%). Just looked at LGT Management fee(0.75%) Cystody (0.25%) so you pay 1% as I understand and more fees for every trade.

Maybe don't get the concept of private banking. But maybe it is more about the network and so on. So helping raise money or find private investors. Please correct me if that is wrong...

 

[troubled soul]

Is there any issues holding 8 figures with SQ or SAXO? I mean lets say you just want to invest in some ETF's.

Although been rejected by most private banks so far, the fees seem to be much to high (nearly 1%). Just looked at LGT Management fee(0.75%) Cystody (0.25%) so you pay 1% as I understand and more fees for every trade.

Maybe don't get the concept of private banking. But maybe it is more about the network and so on. So helping raise money or find private investors. Please correct me if that is wrong...

https://www.offshorecorptalk.com/th...buy-low-fee-index-fund-etf-by-yourself.33166/
Hope this help...

 

[wheelspin]

Although been rejected by most private banks so far, the fees seem to be much to high (nearly 1%). Just looked at LGT Management fee(0.75%) Cystody (0.25%) so you pay 1% as I understand and more fees for every trade.

forget about rates on their published schedule of fees. If you bring a bunch of money, you can negotiate.

 

[denniz07]

forget about rates on their published schedule of fees. If you bring a bunch of money, you can negotiate.

Not sure what a bunch of money is. Would bring no more than 4MM$ to a private bank. Which private bank would you suggest for such sum? With good fees and of course a bit "service" what ever that means in private banking.

UBS gave me 0.65% custody fee assuming 500K, but I would negotiate if they accept the money and more cash is on the account.

 

[Fred]

Is there any issues holding 8 figures with SQ or SAXO? I mean lets say you just want to invest in some ETF's.

Although been rejected by most private banks so far, the fees seem to be much to high (nearly 1%). Just looked at LGT Management fee(0.75%) Cystody (0.25%) so you pay 1% as I understand and more fees for every trade.

Maybe don't get the concept of private banking. But maybe it is more about the network and so on. So helping raise money or find private investors. Please correct me if that is wrong...

At least with Swissquote there is no issues with holding 10-20m$ especially in stocks like ETFs.

Have seen this and even helped with getting onboarded for several of our clients - support is good - no advisory but you can get some good pointers at least from the DIFC guys here in Dubai.

The most important thing is that Swissquote is heavily used in Switzerland itself so should ever something go wrong the GoV has pressure helping them out to keep the citizens happy.

This is not something you can say about most Geneve Private Banks with 70-80% non-resident / Citizens being onboarded there.

So from this point of view I would only go with either UBS for private banking / Swissquote for discount" borgerkage and Post Finance for personal / retail account - everything else is in fact beside of the Banks of each Canton not used at all from Switzerland residents / citizens. Same goes for Liechtenstein - LGT owned by the Prince or LLB owned by the country - avoid banks like bendura onboarding Panama, BVI with "exotic" UBOs.


Can't comment on benefits of private banks - I guess it's all about connections - BNP offered once part of there wealth management access to football lounges they are sponsors of.