Swiss private banking boutique Banque SYZ reported a net profit of CHF 7.1 million for 2019, thanks to the performance and growth of its private banking business and external asset management activity. The SYZ Group reports its Private Bank’s annual results for the first time this year, in an effort to provide clients with greater transparency about its business.
2019 offered excellent investment returns, generating significant value for our private clients across all regions. Banque SYZ’s discretionary and advisory portfolio management teams provided clients with top-quartile performance in USD, CHF and EUR portfolios. In addition, our external asset managers saw significant growth in net new money and revenues exceeded expectations as clients chose more active investment approaches. Banque SYZ also continued to centralize custody services from Switzerland and concentrated on core markets in order to offer clients the best possible service. Implementing this strategy, the bank made several significant hires in Geneva, Zurich and Ticino.
In 2019, markets recovered from a challenging 2018, and most asset classes posted gains for the full year. However, investors had to adjust to long-term weak growth and low interest rates with the risk of deflation. Looking ahead, 2020 will be a turbulent year in light of the impact Covid-19 is having on global markets.. To successfully navigate the more challenging markets ahead and remain invested throughout the economic cycle, this environment demands a dynamic and more active approach to asset allocation. SYZ Capital, the Group’s center of alternative investment excellence, continued to deepen its offering, providing private clients with robust investment tools, including private market access, to create well-diversified portfolios which offer both access to truly uncorrelated assets and strong, risk-adjusted returns.
The year also saw Banque SYZ implement a key change to its leadership structure. Eric Syz stepped down as CEO of the bank in February 2019 in order to focus on his role as Group CEO. This allows him to lead a client-focused strategy around a new governance structure and three independent business lines: private banking including external asset management, institutional asset management and alternative investments. Yvan Gaillard, previously the Group’s COO, took over as Banque SYZ’s CEO and Nicolas Syz was named Head of SYZ Private Banking.
“Last year has shown the first strategic fruits of a multi-year evolution of our business,” said Yvan Gaillard. “As we work to become the most trusted, family-owned-and-managed Swiss Private Bank, our focus is not on volume but rather on providing the best investment performance and quality of service for our clients. We are delighted that the work we have done to manage costs and continually improve our margins is already paying off and our private banking and external asset management business is going from strength to strength.”
“In today’s environment, there’s no substitute for an active approach to generate portfolio yield. Our strong results are a reflection of our discretionary and advisory portfolio managers’ performance, delivering significant value for our clients with a strong upside participation and reduced downside risk”, said Nicolas Syz. “Our teams have delivered a strong performance in 2019 and are off to a solid start this year as well, as we continue to think beyond absolute performance and aim to deliver what our clients expect and need in order to reach their personal life goals”.
In 2019, Banque SYZ focused on reinforcing its investment expertise and external solutions for clients. The Bank continued to divest from non-core markets in order to focus on investments in key regions. This strategic repositioning on fewer countries led to net outflows of CHF 615 million.
Overall, Banque SYZ’s strategy generated profits of CHF 7.1 million for the full year. At 31 December 2019, Banque SYZ managed CHF 24.6 billion* on behalf of clients and its total equity rose to CHF 213 million, underlining our independence and financial solidity. This improved the Tier 1 ratio to 21.3% at the end of 2019, far in excess of Switzerland’s regulatory requirements.