Page 12 - Layout 1

Banking
information exchange mechanisms with some The Rock has not always been a 90 countries around the world, including 27 successful place for Swiss bankers. In 2013 bi-lateral tax information exchange EFG Bank closed its loss-making Gibraltar agreements (TIEAs) that variously came into business (that it gained from Spanish-owned, force from 2009 to allow for specific requests Banco Atlantico), along with banks in France by competent authorities for detailed and Sweden in a move that cost up to CHF information. It is believed that Gibraltar has 11.7m (around £8m).
received around 200 TIEA requests regarding In 1987, other Spanish banks began individuals resident overseas or entities private banking operations in Gibraltar, controlled by such individuals, but none Banco de Bilbao and Banco Central, followed have been sought by Gibraltar of other by BBVA Privanza International, and jurisdictions. Santander jointly with Royal Bank of
UK economy even if there was Brexit. “We are confident that the UK still will remain the international centre for wealth management”, he asserts and the merger “is part of a long-term plan to expand our business in the UK and Anglo Saxon international jurisdictions” – the Channel Islands and Gibraltar. The combined operation has £16bn of assets and saw £2bn added in final 6 months of 2016, “demonstrat- ing strong confidence in the business”,
Barnett declares. The prospect of Brexit for Turicum, a
self-described ‘small to mid-sized bank’ (as measured by funds under management), is not seen as a particular problem, given its correspondent banking arrangements with Swiss, UK and Gibraltar banks. However, Businger says: “It does present an ironic twist, as after Switzerland recorded a narrow binding referendum result in the early 1990’s to stay outside of the then European Economic Union, the bank’s founders decided to set up in Gibraltar [which is at present in the EU], and which was developing as a financial services centre”.
Turicum says it does not depend on external financing and “in order to protect the Bank and our clients’ wealth we do not engage in any risky banking activities”, including corporate and investment banking services, mortgages or commercial loans.
Staff numbers grew from 25 to 33 last year as a result of “continuing steady growth from what he describes as “a relatively small base of customers with an average investment level above €2m, mostly from Germany, France, England and Gibraltar”. Bussinger reveals: “In 2015 our asset base rose by more than 30% and in 2016 it was a further 10% higher.”
The Bank, he admits, is “a very profitable enterprise” and Bussinger emphasises: “Gibraltar is our home and we are fully committed to the jurisdiction as we are not part of a bigger banking group that might decide to leave for internal political reasons.”
Launched in May 2015 as a State-owned retail bank, Gibraltar International Bank considers expanding into the private banking sector as a possibility, and subject to Board and shareholder approval. “It will depend on the appetite of the market – we know there has been some movement in that market locally,” observes Lawrence Podesta, chief executive. “We will need to see where we stand in a couple of years’ time and where Gibraltar stands, given Brexit”,
Scotland, but today none remain.
Personal choice grows
The total funds under management for Gibraltar’s seven private banks at the final quarter of 2016 was £7.4bn, compared to £6.4bn a year earlier, but in that time there has been a significant shift away from bank-led investment decisions to non-discretionary, client-made decisions – up 22% by value to reach £6.9bn.
There are five purely private banks in Gibraltar and two others with an element of retail banking, including Danish-owned Jyske Bank, which has been in the territory since 1987 after taking over A.L. Galliano Banker’s Limited, Gibraltar’s oldest private bank in Brexit provides “ironic twist” for turicum, says chief private ownership that dated back to 1855. executive, andreas Businger
Jyske’s original business was 60-70% Barclays announced its withdrawal from with private clients, but it became “difficult Gibraltar after more than 100 years, first in after the 2009 Lehman Bros collapse”, retail banking by early-2015 and closed all of recalls Christian Bjørløw, chief executive of its operations locally by mid-2016 when it Jyske Bank (Gibraltar). Five years ago, Jyske withdrew a small office dealing with large decided to become a full service bank, so that companies and very HNWIs, transferring that today private clients account for around 40% business to London and Jersey. of business, with assets handled expanded to Its origins in Gibraltar, however, went over £1m. With a minimum of £150,000, “an back to June 1888 when as the increasing number of Gibraltar people are Anglo-Egyptian Bank Limited it became the able to invest”, he notes. first non-Gibraltarian bank to open a branch.
Last year Bank J. Safra Sarasin (Gibraltar), which opened in 2001, took over Remaining confident the local branch of Credit Suisse as well as Lloyds Banking Group’s office in Gibraltar one in Monaco, acquisitions it describes as with 30 staff “provides a banking service “an excellent strategic fit” that will allow it to several thousand UK expatriate or “to extend its reach in these attractive private international customers that reside in Europe” banking jurisdictions”. This year saw Bank and for private banking they need to meet JSS (Gibraltar) establish, essentially the minimum eligibility criteria of a sole annual Credit Suisse business it took over in income of £50,000 or hold £25,000 to save or November, to provide wealth management invest (or currency equivalents), or hold at services to private and institutional clients, least £100,000 to save or invest with the bank and it is expected to re-launch the combined within six months. businesses this autumn. Britain’s intended exit from the EU in
Bank J. Safra Sarasin accepts deposits 2019 has not discouraged private bankers. both from individual clients and other Barnett says the merger of Kleinwort and banking institutions, and said in November Hambros was completed before the that it was “determined to further strengthen referendum vote in June 2016 and “our its position, as it believes in Gibraltar as an French parent was prepared to make an important financial centre”. investment in the UK and its growth in the
12
Gibraltar International www.gibraltarinternational.com