The 2008 guide toSe

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Private Banking and Wealth Management

Safeguarding family wealth 3in a changing worldFamily Wealth Debate

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This guide is for the use of professionals only. It states the position of the market as at the time of going to press and is not a substitute for detailed local knowledge.

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Contacts: Europe: Belgium (32) 9 242 22 22 - Channel Islands (44) 1534 815555 - France (33) 1 53 43 87 00 - Gibraltar(350) 200 4850 - Greece (30) 210 87 71 100 - Luxembourg (352) 47 93 11 1 - Monaco (377) 97 97 58 00 - Switzerland(41) 22 819 02 02 - UK (44) 207 597 3000 Americas: Bahamas (1) 242 302 5000 - Canada (1) 403 234 8191 - Uruguay(598) 2 623 28 40 Asia-Pacific: Singapore (65) 6303 3888 - Hong Kong (852) 22 00 26 00 - Japan (81) 3 6229 4300India (91) 22 6630 9680 - China Mainland (86) 21 5049 9828 Middle-East: UAE (971) 4 4257 600

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CAL, Lowenhaupt Global Advisors Let’s start off by looking at the

impact of globalism on families. What are the challenges in being a

global family of substantial wealth?

SH, Family Office Exchange Families have similar financial challenges

whether they are based in Singapore or Europe or the US. But for

the multinational, multi-jurisdictional family, there is much more

complexity and cost involved in managing wealth when members

are in many countries. There is much greater complexity in the

accounting, reporting and custody work that is required to support

different jurisdictional issues and keep up with regulatory changes. I

think the greatest challenges for these families is actually in the fam-

ily governance and the decision-making process. It’s much harder to

get people in five time zones to have a clear understanding of what

discussions need to be made. Distance mandates delegation to oth-

ers, which is difficult in many family cultures.

LT Challenges have become most noticeable in regions of the world

where wealth has exploded, such as the Middle East. The challenges

are also most acute, it seems to me, where the family has made its

wealth from the first generation and is now facing the succession

issues of the next.

JAMH, The Hutchinson Consultancy Globalization is going to increase

the number of wealthy families, as business-owning families decide

to sell out or undertake IPOs. The challenges facing these families

are not, first and foremost, in my view, investment or business

decisions – but more relating to soft and human issues such as next

generation matters, personal security, reputation management and

conflict resolution. Also, in terms of whom to turn to for help in

managing this liquid wealth, I think that they will opt to create

their own family offices because they have a certain distrust of the

larger banks. They want to feel they have someone who is fighting

in their corner for the family’s interests and not some individual

whose first responsibility is, sadly, the bank’s profit and loss.

CAL, Lowenhaupt Global Advisors Certainly, providing services to

families scattered across the globe will be challenging. How has the

family office sector been developing in your respective regions?

DA, AzureTax In Hong Kong, there are very few wealthy families who

are actually from Hong Kong. We have a lot of families based there

now for tax reasons or, indeed, because business is good; they’ve

made a lot of money and they’ve stayed. There isn’t the huge volume

of large family offices in the Far East, and we’re seeing new tries at

setting something up. The families we deal with don’t like to use the

major institutions, such as private banks. They have private banking

accounts with a number of institutions, but will they be taking advice

from those institutions? Generally speaking, not. A lot of families do

things for themselves with a few key advisers.

SS, Amarchand Mangaldas In India, at present, wealthy families tend

to have their issues taken care of by one person who would be a pro-

fessional but who is part of the extended family. The challenge is:

how does that become a family office? At the same time, Indians are

expanding their wealth in terms of acquiring companies globally,

Safeguarding family wealth in a changing worldWealthy families are facing growing challenges as they become more global. How can they manage their structures as family members move abroad? Where should they invest to truly diversify their assets across the globe? Is philanthropy a challenge in some cultures? And can the financial service providers who claim to be able to help ever regain families’ trust?

Executive summary• Globalization – with members of wealthy families located in

different countries – has made management of family wealth a

more complex process

• In some parts of the world wealthy families resist the

establishment of formal family office structures

• The measurement of the performance of family investments is

complex and not well developed, particularly as many families

should be looking to long-term, not short-term, returns

• Wealth management independently organized by a family office

has been facilitated by modern communications and technology.

But there is still a need for outside advice and services

• Diversification of investment, both of asset types and of

jurisdictions where assets are placed is a crucial issue

• Philanthropic activities demand as much professional input as

does investment

• Ad hoc and more formalized networking and collaboration

between wealthy families is a growing trend

and therefore being in a position to really have a multi-locational

presence, multi-locational assets, multi-locational management. So

it’s about managing to delegate trust, and creating a structure engag-

ing those members who want to take part in the family affairs and

those who want to do their own things in life. We’ve come from a

regime where accretion of wealth was almost like a crime, and we’ve

moved into the situation where creation of wealth is being recog-

nized over the last 15 years.

JA, Barclays Wealth In the UK, you can find a myriad of different

arrangements. In England in particular, if you had said 20 years ago:

“What’s the family office?” someone would have said “It’s the estate

office”. But the huge growth of liquid wealth of families in Europe

and the UK is changing that idea. There are some families in the UK

who have had family offices that have run for more than 50 years

but they’re pretty few and far between. I do get the impression,

though, that more people are questioning whether setting up a fam-

ily office is the answer. Do you need a formal structure?

CAL, Lowenhaupt Global Advisors Before we get on to governance

and structure, let’s start by addressing financial investments. How

should wealthy families measure investment performance?

CBB, Institute for Private Investors It is difficult, and there is a need

for clearer metrics to measure the performance of financial invest-

ments of a family. First, what is their goal in terms of a return? And,

secondly, how do the various managers they’re using compare, both

in peer groups, but also on risk level.

DW, Forvest Trust Measuring returns is complicated. There are

returns in the short term, cashflow returns, and longer-term growth

and capital gain investments. You must also consider the volatility

and liquidity of the investment. If we are talking really about liquid

assets – yes, returns can be measured, and performance of the asset

managers can be compared, but families tend to have a broad port-

folio of diversified assets where comparison and performance need

to be carefully defined.

JAMH, The Hutchinson Consultancy There’s probably too much short-

termism. When you are judging external portfolio money managers,

fine, but, if one’s looking at unquoted situations or property, it may

take a whole generation before you actually see the return. Families

should be looking longer term, not quarter by quarter.

DW, Forvest Trust That’s very true, but what about the family’s need

for money right now? It is important to start by analysing the pur-

pose of the investment return. What is the money required for? And

from there, go on and establish an investment policy.

CAL, Lowenhaupt Global Advisors As the individual answers the start-

ing question: what is the wealth for? how should he or she consider

the requirements of the investment returns?

DA, AzureTax It varies. In Hong Kong, I have clients who are just sit-

ting on billions of dollars in wealth, doing nothing and they don’t

want to do anything with it. In some cases they don’t trust people

to look after it, and in some cases they simply are not interested in

diversifying or investing that money.

DW, Forvest Trust Having a purpose is very important. Too few

wealthy families think about how to use the money they have at-

tained. That purpose can be short-term, such as funding a health so-

lution, and building the capital back up is a secondary concern. Or a

family might require a longer-term plan. We need to first analyse the

purpose of the returns and then plan the investments.

Best adviceCAL, Lowenhaupt Global Advisors Who is best placed to advise and

invest family wealth?

JA, Barclays Wealth It depends. Some families have simple invest-

ment needs and can build their own infrastructure to handle that,

others will require external managers. Scale is really required,

though, if a family is to have a group of individuals as good as a

bank taking care of the investments.

CBB, Institute for Private Investors We’ve seen a shift in the balance

of power away from external financial service companies to the in-

vestor, thanks to technology and transparency. Up to now financial

services companies had more information and more knowledge

than their clients and than the investors. That is no longer the case.

DW, Forvest Trust Yes, but even though there is much more informa-

tion around, it may prove counterproductive and does not replace

the requirement for professional asset management, particularly

in a diversified portfolio. I agree that the family office may be able

to understand and evaluate the investment process, fees, type of

investments, etc, but it may not necessarily be able to evaluate the

risk/reward ratio and form a global view, for which a true profes-

sional is irreplaceable.

CAL, Lowenhaupt Global Advisors We touched on diversification

earlier. How are families diversifying their portfolios?

DA, AzureTax I don’t think I’ve come across a truly diversified family

in terms of geographical spread and risk spread in Asia. If they have

a business, a lot of their money will still be in it. You hear about

families having investment committees, a pool of advisers on invest-

ment strategy, but they still often get overridden by the patriarch,

who says: “No, we must have x, y and z”.

SH, Family Office Exchange There are regional differences. Contrast-

ing Europe with the US, it seems that European families take much

Charles A Lowenhaupt (CAL – chair) is founder,

chairman, president and chief executive of

Lowenhaupt Global Advisors, and a recognized

industry leader in managing wealth for ultra-

high-net-worth families around the world.

He is also managing member of Lowenhaupt

Global Advisor’s affiliated firm, Lowenhaupt &

Chasnoff.

phot

ogra

phy:

Sim

on C

lark

e

ParticipantsDeborah Annells (DA), managing director of

AzureTax Limited, has been at the forefront

of Hong Kong’s taxation profession for

more than 10 years. In 2002, she established

AzureTax to provide transparent, strategic and

ethical international tax advisory services for

individuals and businesses.

Charlotte B Beyer (CBB) is the founder and chief

executive of the Institute for Private Investors,

whose online community and educational

programmes afford a safe harbour for 1,180

private investor members from 18 countries.

Shardul Shroff (SS) is the managing partner of

the leading law firm of Amarchand Mangaldas.

He is based in New Delhi. His family is the

promoter family of the law firm, which

originated as a family firm. The family still has

a substantial capital and profit share in the

firm.

Lee Thistlethwaite (LT) has more than 30 years

of investment and private banking experience.

He worked for JPMorgan for 25 years before

retiring as a managing director in 2004. Since

then, he has been an independent adviser to

several wealthy families in Europe and the

Middle East. He is based in Geneva.

JA Michael Hutchinson (JAMH) has been

assisting families for 30 years. He worked in

the Guinness family office for some 15 years.

During that period, he realized the importance

of the personal touch, and subsequently

established The Hutchinson Consultancy.

Sara Hamilton (SH) is the founder and

chief executive of Family Office Exchange.

Recognized for her expertise on wealth owners

and their family offices, she and other Family

Office Exchange managers serve as strategic

advisers to sophisticated investors with assets

lasting beyond one generation.

David Wollach (DW) is managing director

of Forvest Trust, a Swiss asset management

company based in Geneva that specializes in

the high-net-worth-individual market.

Thayer Willis (TW) is an author and expert in

the area of wealth counselling. Since 1990,

she has specialized in helping people handle

the psychological challenges of wealth. Born

into the founding family of Georgia-Pacific

Corporation, she has a unique perspective on

wealthy families.

John R Healy (JRH) was appointed adjunct

professor in the Centre for Nonprofit

Management at Trinity College, Dublin, in

2007. He serves on the boards of the Irish

Landmark Trust and the Trinity Foundation, is

a member of the Irish government’s Forum on

Philanthropy, and sits on the advisory board of

the One Foundation.

Jeremy Arnold (JA) joined Barclays Wealth in

September 2006 as head of wealth advisory.

He is also a member of the Barclays Wealth

Management Committee. He is responsible for

providing advisory-based solutions including

fiduciary products and services. He has more

than 20 years’ experience.

greater control over the actual management of the assets that they’re

involved with. They might have an average of 20 managers that

they’re working with when a US family would have 40. In Europe,

families tend to be focused on issues related to business ownership,

so we see less of a focus on investable equities and less confidence in

the public markets for the equity investments than we do in the US.

In real estate, US families might have an allocation of around 10%,

and among European families it’s much closer to 20%. In general,

Europeans are less invested in hedge funds and fixed income, and

more invested in the natural resources and energy area.

SS, Amarchand Mangaldas In India, diversification is growing. The

traditional investment has been gold. And clearly securities and

mutual funds are the preferred investment vehicle. Art, however,

is becoming increasingly popular. And there are new commodities

funds setting up. From a geographical standpoint, there is a clear re-

alization by families that this is the time to buy outside the country,

and to hedge for the day when demand in India might go down.

This might include business acquisitions outside India, so families

need corporate as well as personal investment advice.

CBB, Institute for Private Investors There is certainly an interest from

families worldwide in diversifying assets globally. Last year, 70% of

IPI members intended to increase their exposure outside their do-

mestic market. Until recently US family offices were invested twice

as much in non-US markets as the average US pension plan. The

way they do it, however, is typically to look for referrals from trusted

advisers or their own peer group, and they will tend to find local

managers or global firms that have access to local managers.

CAL, Lowenhaupt Global Advisors What about jurisdictional diver-

sification of governance structure? How does jurisdiction dictate

structure and planning?

LT Sometimes structure is forced to be altered because family mem-

bers move to another jurisdiction. They may start off as one family

with pooled assets in one jurisdiction but once one member moves

to another jurisdiction, it throws up all sorts of very difficult issues.

Today this is happening more frequently and is causing huge debate.

DW, Forvest Trust It is important to diversify jurisdictionally in any

case. You can diversify assets, but if you don’t also diversify the

structure in which you are holding it, it can be devastating.

DA, AzureTax Having all your assets with one custodian, for exam-

ple, could be a danger.

DW, Forvest Trust Or holding all the assets in an investment com-

pany that happens to get sued, for example, because of a private

equity deal it is in. In that case all the assets would be exposed

unless the structure was diversified.

LT In some cases, political disturbances have forced families to

diversify jurisdiction. Whether it is the Shanghainese leaving China

in 1949, or it was non-resident Indians leaving the subcontinent in

1947, or the Jewish community, these diasporas have gone across

different parts of the world. This is one reason Switzerland has at-

tracted enormous amounts of money. The country has been a great

beneficiary of political stability.

CAL, Lowenhaupt Global Advisors These historical, political events

can shape an investment mentality. Here is an example. A family

I know in the US who moved there as refugees a generation ago

has what they would call investment real estate in 10 jurisdictions

around the world. What family members will say is: “This is good

for investment diversification”. What the patriarch would say is:

“This is good because if we ever have to leave one country we can go

to another country”, and he’s not thinking at all about the financial

returns, he’s thinking about lifestyle or life preservation.

JA, Barclays Wealth That’s a good point. Lots of families and family

offices, what they’re concentrating on is security, political risk, not

losing money. You may therefore not want to invest in emerging mar-

kets despite the growth prospects, you may actually want to go and

buy prime real estate in London or New York. The outlook among

families differs. It is not just about going out into the world and try-

ing to make more money than the next money manager. If you look

at family offices, some are actually in wealth-creation mode and some

are in wealth-preservation mode. Their needs will differ.

PhilanthropyCAL, Lowenhaupt Global Advisors When talking about investments

and family wealth, philanthropy has to be part of that conversation.

A wise woman I know said: “When I put money into my commu-

nity, that is as much an investment for my children as any stock or

bond I can buy”. How can we go about measuring return on philan-

thropic investments?

JRH, Trinity College The problem is that the return on investment

is a social return, for which no measurement system has yet been

devised. This allows people who are professionally involved in the

world of philanthropy to play around quite a lot and be relatively

unaccountable. One interesting development that will occur over

the next few years is that a lot of the new money that is coming into

philanthropy through people who have made a lot of wealth in re-

cent years, particularly but not exclusively in the hedge fund area, is

money that is going to be invested according to a much more com-

mercial model than has traditionally been the case in philanthropy.

And that I think is a very welcome development.

CBB, Institute for Private Investors Melissa Berman of the Rockefeller

Philanthropy Advisory Group pointed out that this trend towards

measuring philanthropy so exactly and in a commercial way can be

very counter-productive, because it’s almost like venture capital. If

you went into venture capital, you cannot measure its success in the

first three months. It sometimes takes years. So I think her position

would be to have a solutions-based view, identifying a problem or

cause and then being patient. So I just want to make sure we don’t

think of philanthropy as something that’s suddenly going to be hav-

ing a quarter-to-quarter measure.

CAL, Lowenhaupt Global Advisors Just as philanthropy went nation-

wide with the Rockefellers and Carnegies, today philanthropy is

going global with the Gateses and Turners. Is global philanthropy

different and will the global family think differently about philan-

thropy? Is diaspora philanthropy different from home-grown?

DA, AzureTax In the Far East, philanthropy has got a way to go.

Families make donations, but it is not their purpose in life. There is

not a formal structure for philanthropy in the region.

JRH, Trinity College I think there are differences around the world,

and I think the differences are particularly cultural differences. My

own country, Ireland, is a case in point where we’re trying to get

philanthropy started after a period of rapid economic growth and

the accumulation of significant wealth for the first time in history.

But there is a begrudging culture that does not value philanthropy.

The Bill Gates situation is obviously the polar opposite of that, and

Gates’s philanthropy has won him much acclaim and we have all

forgotten about anti-trust issues. The process of philanthropy does

not differ from culture to culture and from country to country,

however. You make your investments and you try to get the best

return possible. But the level of sophistication is very different. And

philanthropy in any country has to go through a series of lifecycles.

Initially it’s mostly heart; then it becomes a combination of head

and heart, and then a little bit more head, as people try to measure

more precisely the impact of what they are doing, be more strategic in

their giving, less responsive. Philanthropy is a very fulfilling business,

but it’s also a serious business, because you have a chance to achieve

significant social change, so it has to be approached carefully. And

I would hope that family philanthropists will realize that it has to

be approached professionally and that it will be more successful if

families are prepared to create structures through which their philan-

thropy can be pursued. And creating such structures requires them to

do something very difficult – they have to give up some control.

TW There is an important consideration for families before phi-

lanthropy can be a very fulfilling business. This is a law of human

nature, which cuts across cultures. In many wealthy families, dif-

ficult relationships develop, damage the family and even some-

times destroy it. When family members are hurting and angry, it

is human nature to withdraw, to pull in and to be psychologically

busy managing the pain. This makes effective philanthropy impos-

sible. If anyone in the family has the wisdom to acquire assistance

in healing these relationships, the family members, as they heal,

will naturally become more expansive and generous. It is only

then that philanthropy can become a very fulfilling business in

that family. This pre-philanthropy need must be addressed or the

philanthropy will be limited. Families in all cultures share this

characteristic.

CAL, Lowenhaupt Global Advisors If philanthropy is not for ama-

teurs, who can help families on setting up a structure?

JRH, Trinity College If families are pursuing their philanthropy at a

reasonable scale, it requires them to hire the best people they can.

And it requires them to give those people the space and the author-

ity and the discretion to be effective.

DW, Forvest Trust I agree it has to be done professionally, but one

doesn’t have to be a chartered accountant to know the general

concept of accountancy. So being part of a wealthy and charitable

family means that one also has the responsibility to have a general

concept of philanthropy, set the goals and directives and then leave

it to professionals to be carried out effectively.

CAL, Lowenhaupt Global Advisors But does that detract from the

enjoyment of philanthropy?

JRH, Trinity College That’s true. The most compelling reason to get

involved in philanthropy is that you can get more fulfilment and

bring more meaning to your life. Now you can’t on the one hand

argue that, and on the other hand say you have to give it over to

professionals. So, as with everything else in life, it’s a matter of get-

ting the right balance. I think they need to be engaged. They will

not get fulfilment and meaning out of it unless they are engaged,

but they need to avoid micro-managing, and quite frequently they

are seen to do that.

CAL, Lowenhaupt Global Advisors It may be that there are two ele-

ments of philanthropy for a family. One is the professionalization of

the process of giving – grants, investments and so forth. The other is

the strategic analysis of how to use philanthropy to help the family

build its own functionality. Discretion is a key point too when con-

sidering philanthropy. How and should families keep their giving

confidential?

JRH, Trinity College There are many influences on philanthropy that

require accountability and transparency of a kind that we have not

experienced in the past, and that obviously cannot be combined

with the sort of discretion that a family would expect through a

family office. Resolving that issue is quite difficult.

DW, Forvest Trust In philanthropy we speak about values. I think the

most valuable philanthropy is anonymous philanthropy, because

that’s really what true philanthropy combined with value is.

JRH, Trinity College Anonymity is very attractive but it has some

downsides, and if you pursue your philanthropy at a certain scale

it becomes impossible to be anonymous. The solution, I think, is to

pursue your philanthropy discreetly and modestly.

TW Philanthropy is such a tremendous tool for families. Discretion

in the eye of the public, as you mentioned, is important. Yet among

family members, philanthropy also produces recognition of a fami-

ly’s strength. It is also a wonderful way to teach business principles

to the family.

CollaborationCAL, Lowenhaupt Global Advisors An interesting point was made

earlier about collaborations and networking of families. Can we

return to that?

CBB, Institute for Private Investors Yes, there seems to be a trend

toward looking for partnerships with families in other countries,

whether it’s philanthropy or on the investing front. We’ve seen a

shift in family attitudes about being singular in their focus and do-

ing these things themselves, to having a much greater appetite for

collaborating with other family groups. What is not entirely clear is

exactly how families will be able to do this structurally in ways that

hold up over long periods of time.

JAMH, The Hutchinson Consultancy Co-investing with families that

they know and trust in the local jurisdiction is becoming more

popular than just relying on local money managers, I agree. For ex-

ample, agribusiness has been interesting, and international families

are co-investing with local families in South America to gain access.

LT In Scandinavia you will increasingly come across co-investments

of the major families. Why? It’s a relatively small region of the

world, they do know each other quite well, they think in similar

kinds of ways,. Structurally this does indeed raise issues. If two

families get together, the first thing both of them independently

and then jointly should be questioning is what is the match in

terms of their families’ values and visions and ideals? And if those

are mismatched, then I’m not sure that they ought to be talking to

each other, and they certainly ought not to be paying any financial

adviser to try to hitch them together.

SH, Family Office Exchange I think in the future we will see col-

laboration that is aligned with investment interests that are closely

aligned with groups of families coming together in ways that are not

permanent but in interactive ways to have an exchange or to co-in-

vest or collaborate in some way. A network might be formed among

families in different parts of the world because they bring something

to the table that’s valuable to each other. There could even be multi-

ple networks that a family might be part of. The structural relation-

ships will get even more complicated than they are today.

JA, Barclays Wealth But in terms of governance structures, I’ve done

work with single families, and trying to work out the structures with

a single family is very difficult. But surely we’re not talking about

two families having one governance structure?

CAL, Lowenhaupt Global Advisors Isn’t that a multi-family office?

JA, Barclays Wealth My perception of a multi-family office is that

you might get different families with separate legal structures but

they pool their resources and certain investments.

SH, Family Office Exchange The ways in which we’ve seen families

collaborate in a multi-family office structure are a precursor of future

collaborative models. Private family-controlled buying consortia

that have the same kind of access as the larger institutions is more

desirable for many of our members than collaborating with any

financial institution, where the senior executives are going to be

changing every three or four years.

CBB, Institute for Private Investors Technology is fuelling the ability

of families to share their ideas globally.

CAL, Lowenhaupt Global Advisors Sharing ideas around the world is

valuable. I know an Indian family that has a family business, and

part of their requirement is that any younger family member who

wants to be part of the family’s wealth has to spend one month

every summer doing social service work as a volunteer in the village

from which the family originated. That is a fine idea and I’ve taken

that idea to a couple of US families.

CBB, Institute for Private Investors It brings great hope that the best

practices globally will be seen by others and adopted. Wharton’s

10-year-old Private Wealth Management programme brings families

from 10 to 15 different countries in a room with the professors, and

then at night they’re comparing notes and learning from each other.

LT This cross-border communication can also complicate issues for

families, however. In some parts of the world there are huge debates

under way, whether they are gender debates or educational debates,

or religious debates about what the family thinks it ought to be

doing as opposed to what it wants to be doing, because there are fac-

tional differences of opinion, and very strong ones, being fed from

different sources. Globalism, in a way, doesn’t help family unity.

CAL, Lowenhaupt Global Advisors Globalism is creating multi-cul-

tural families, and that comes with challenges.

SS, Amarchand Mangaldas That’s very true, and I think the diversity

aspect is something that families are actually living with in the sense

they’re not attempting to clone the same behaviour, going down the

route that diversity is a fact of life, and that is something that you

need to work around rather than against.

JA, Barclays Wealth We do a lot of work in the Middle East, and we

see a lot of families being affected by this cross-cultural thing. For

example, the patriarch made the wealth all in the Middle East, sends

the son off to college in the US or to England, and they come back

and they may have acquired conflicting values.

TW The family culture is going to have a big effect on how well

diversity can be developed.

GovernanceCAL, Lowenhaupt Global Advisors Have any of us seen a governance

structure that allows for diversity and creativity, that is either work-

ing or, more importantly, we believe will be working over the next

100 years?

SH, Family Office Exchange I have. We’ve spent a lot of time looking

at what kind of structures will allow flexibility and freedom, and yet

connectedness in ways that allow both principles to survive. Pos-

sible structures exist in different forms and accommodate different

philosophies for decision-making. There is the united-we-stand phi-

losophy, which allows a family to stay together for generations by

defining their affinities and in what ways they want to be together.

Then there is the divided-we-stand philosophy, which allows owners

to invest together in flexible ways. They are divided in their owner-

ship and their legal structures, but able to use their investment

dollars in collaborative ways. The approach allows owners to leave

whenever someone feels the need for independence.

CAL, Lowenhaupt Global Advisors What do you think will be the

challenge for the multicultural family?

SH, Family Office Exchange It is a very complex challenge. We are

involved in a family business study in Asia looking at how govern-

ance is being structured to transfer wealth successfully from first- to

second-generation families in multicultural settings. It will take

about a year for us to gather enough data to analyse what works and

what doesn’t work. And, as we all know, what works for one family

doesn’t mean it’s going to work for another family.

CAL, Lowenhaupt Global Advisors Let’s move on to discuss where we

feel financial service providers can truly help family offices, be that

in structure or investments. Michael, what are your views?

JAMH, The Hutchinson Consultancy When it comes to the holding

structures, global banks can perhaps help families and family offices

in the future. I have a fear as to the long-term future of the trust

as a structure, especially for Anglo-Saxon families. Governments

worldwide are very concerned about their tax base and are going to

continue to try to attack trust structures. It would, therefore, be un-

wise for families to just rely on the trust. However, it will need much

original thinking, probably not within family offices, but from ex-

ternal advisers, to come up with some hybrid animal – whether it be

insurance-based, corporate-based or whatever – which can be used

as an alternative to the trust.

CAL, Lowenhaupt Global Advisors What about investment?

CBB, Institute for Private Investors I’m optimistic that the finan-

cial services industry grasps the change that has occurred among

investors. The industry is seeing the importance of transparency

and technology, firms realize they need new definitions of risk and

outcomes, and that they have to decouple advice from product.

The most advanced of these financial service entities will begin to

execute on this, and begin to act on what their clients and their

prospective clients are telling them.

DA, AzureTax I think it’s very difficult for banks and major financial

institutions to actually act in that way. The bank or the financial

institution is worried about its share price, it is worried about its

reputational risk, and it can’t actually do what is best for the family

in many cases. And usually the family has got 20 or 30 providers

– why is it going to select one particular institution to pull together

all the pieces for them, perhaps in terms of analysis of investments

or structural issues? I just don’t see it happening. And we’ve been

talking of the family office industry; well, there is no such industry.

It’s a wonderful idea to try to develop such an industry, but I just

don’t think it exists in any formalized style actually. I see exchanges

between families. I can see groups of people like this today, but I just

can’t see anything more institutional or more significant than that.

So I just can’t agree that financial services firms will be able to tackle

the issues.

JA, Barclays Wealth Well, the job of financial institutions is to

provide family offices with what they need, not what they think

they can sell them, and that’s a challenge. I think the opportunity

in financial services is to get yourself back into the fiduciary space,

in the widest sense, and that is about giving family offices what

they need. Family offices are very smart, so you have a much more

superior dialogue and it is good to deal with another institution,

albeit that it has a private client bent to it. But I don’t see it quite as

blackly as you do. I wouldn’t be at a forum like this if it was an area

that was too difficult to deal with. I don’t think it is.

JAMH, The Hutchinson Consultancy I think it will take a lot of time

to rebuild the trust which is lacking between families, family offices

and the global banks. And in the intervening period I think the

banks should be content just to be niche service providers to the

family offices in certain particular areas. Banks should be prepared

to take a long-term view. The perception of families and family of-

fices of the banks based on past experience is that there’s a constant

turnover of staff, and so the families end up repeating their story to

the bank time after time.

DA, AzureTax It’s true. Every three years you end up repeating your-

self to the next family office person with whichever major bank you

are dealing with.

JAMH, The Hutchinson Consultancy The banks should not give up,

though. I do think there is potential there if they take the long-term

view, realize they have to rebuild this element of trust, do original

thinking and provide the solutions the clients want. I hinted at this

earlier this afternoon – think up alternative structures for the trust,

realize the significance of where the family’s computer servers are,

so the bank’s computer servers shouldn’t be in or pass through the

US, London or Frankfurt, otherwise the IRS and others are going

to claim jurisdiction. Start to think in an original and creative way,

and then family offices might come back. The problem with some

multi-family offices is that they’re becoming banks. Families want

original thought, original solutions – not product. Families want

access wisdom.

JA, Barclays Wealth I totally agree. What is very interesting about

family offices is that they are very smart. You’re not dealing with

innocent, ignorant private clients, you’re dealing with highly

sophisticated professionals, and they will come to you when they

need your product, not vice-versa. I think where you’re right is

about the fiduciary side of the business. Interestingly we are now

looking at things like using limited partnerships and so on as an

alternative to the trust structure, because it’s more transparent in

terms of ownership.

Banking needsLT I think we need to be realistic. The banks can only go so far. They

are always going to have to justify to their senior management that

they are making a decent return, as are those multi-family offices

that have sold stakes to global private banks. They can’t get away

from that. They will never, therefore, look at a family from a holistic

point of view, whereas there are many other institutions that are not

banks that are geared to work with family offices accordingly. Most

families in some shape or form need a bank, and they will continue

to use a bank, and those that like leverage have to have a bank. So

banks will be there, but I think that we just have to be realistic, they

will never take over the family wealth space.

DW, Forvest Trust We asset managers consider ourselves comple-

mentary to the banks. We believe banks are acting today beyond

their core business to act as depositors and custodians and grant

credit facilities in case of commercial banks. I think anybody who

uses the big banks today for anything other than that, is not re-

ally evaluating what he’s expecting to receive. We need the banks

because we need the security and financial facilities that the banks

offer us. I think the mistake is that many banks try to diversify in

areas where they can just not be competitive enough nor bring any

real added value.

CBB, Institute for Private Investors I disagree. It’s about talent, brain-

power and solutions, and a family will go where they can find that.

And let’s face it, in many of these large financial institutions there

are very bright people. Of course there is turnover of personnel, but

to over-generalize about financial institutions is a big mistake, be-

cause there are some very happy clients of some major institutions.

JA, Barclays Wealth I think that’s absolutely right, and the challenge

for the bank is to develop the solutions. That’s what the smart banks

do. I think sometimes the professions think that that independent

view can only exist within the professions but there is an alternative

out there.

SH, Family Office Exchange Yes, I would say that at the heart of the

challenge is the issue around customized advice and the ability for

institutions to play a sophisticated role in supporting these families.

I think it is unrealistic to think they’ll be able to take a holistic view

of a multinational family that’s doing business in multiple coun-

tries, because the scale is just so broad. Within any institution, the

number of departments involved in serving that family are com-

prised of territorial people who don’t want to expose their clients to

potential risks inside the institution. So providing pieces of custom-

ized advice in a sophisticated manner probably changes the role that

an institution plays in support of a financial family and their family

office, but it’s a really valuable role to have them there as resources

to access new and innovative strategies. I seldom meet sophisticated

family office executives who don’t want to know about the best

thinking inside leading financial institutions.

CAL, Lowenhaupt Global Advisors But aren’t we also talking about

the concept of trust? I see David’s point that maybe the banks are of-

fering services beyond their competency, but families can deal with

that. What I’ve noticed is that our clients no longer trust the banks.

JA, Barclays Wealth Institutional trust does exist. Families with

huge amounts of wealth sometimes have difficulty in being able to

entrust their money to individuals or a group of family members.

There are still major families out there who will use institutional fi-

duciaries to hold their money, and that means that there is still that

fiduciary trust that’s out there, it hasn’t completely gone away.

DA, AzureTax It has diminished though.

JA, Barclays Wealth I think some wealthy families get comfort from

the institutional pocket.

JAMH, The Hutchinson Consultancy That was the case, but I do think

tremendous damage has been done to the reputation of some very

major Swiss banks over the last 12 months over the sub-prime situ-

ation. How can you expect families or family offices to entrust their

wealth to those organizations?

CAL, Lowenhaupt Global Advisors Good banks say: “Look, we made

mistakes, we do make mistakes, but we also correct them, so you

have our assurance that if we make a mistake, we’ll make you

whole”. People used to believe that but don’t believe that any more.

Trust has to be reintroduced somehow.

LT There’s going to have to be a huge rebuilding exercise. And

there’s also going to have to be a rebuilding exercise between two

very fundamental divisions within these global banks – the private

banks within the global banks, and the investment banks who’ve

cooked up a lot of these investment products that have gone wrong,

because the managements of these global banks wanted these divi-

sions to work more closely together.

A/F P GINA EUROMONEY 210X286 OK 26/8/08 10:05 P gina 1

Composici n

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Vienna-based Bank Gutmann: Private banking “from entrepreneur to entrepreneur”With its unique approach of providing partner-led services to wealthy private clients for more than 30 years, an international team of experts, long-standing experience in the world of private equity and a strong, client-driven system of values, Vienna-based Bank Gutmann is one of the top names in private banking in Europe

Specializing in asset management and investment advice for foreign

and domestic high-net-worth individuals and institutional investors,

Vienna-based Bank Gutmann is a leading private bank in German-

speaking countries, operating also in central, eastern and south-

eastern Europe as well as in selected overseas markets. A strong

international private banking team works closely with an interna-

tional pool of advisers, including lawyers, tax advisers and business

consultants. Bank Gutmann currently manages total assets of more

than 10 billion euro for high- and very high-net-worth clients, trusts

and foundations, and institutional investors.

Owner-managed bank with tradition and a futureFounded in 1922 by the Gutmann family, one of central Europe’s

most influential industrial dynasties with a long tradition of entre-

preneurship as owners of leading industrial enterprises in the Aus-

tro-Hungarian Empire, Bank Gutmann has always been independent

and privately owned.

Since 1959, the Kahane family has been the majority shareholder

of Bank Gutmann AG. Twenty per cent of the share capital is held

by 10 senior managers of the bank. The consistent involvement of

these partners in the day-to-day running of the business is one of

the bank’s key distinguishing features: Gutmann clients are served

by the bank’s owners – from entrepreneur to entrepreneur. They

make their clients’ affairs their own business, for which they as-

sume long-term responsibility. This Gutmann partnership concept

ensures independent and speedy decision-making processes as

well as the special personal commitment of the bank’s owners,

based on discretion and trust.

At home in central and eastern EuropeNot only its historic roots but also Vienna’s geographical proximity

to the east European markets explain why Bank Gutmann has been

working successfully with high-net-worth investors and entrepre-

neurs in this region for more than a decade. In addition to serving

customers in German-speaking countries, the bank focuses on

customers from Hungary (where Gutmann has its own investment

advisory subsidiary), from the CIS countries, the Czech and Slovak

Republics, Romania and Bulgaria, where it is expanding vigorously.

Apart from offering asset management, Bank Gutmann has suc-

cessfully added private equity umbrella funds to its portfolio of

activities. Gutmann invests not only in private equity funds itself

but also helps its customers to participate in attractive invest-

ments. Sepp Maier, a Bank Gutmann partner and head of its

international private banking division, explains: “Over the years,

we have established close links with leading international private

equity investors. This co-operation has provided us with an avenue

to extraordinary investment projects. We are happy also to make

such investments available to our entrepreneurial clients, who

would not be able to gain access to such projects on their own.”

Gutmann, however, is also a sought-after partner for entrepreneurs

who have sold shares in their companies to private equity inves-

tors and now wish to invest the proceeds in the best possible way.

The Gutmann team is assisted by a network of international and

local best-of-breed advisers, among them law firms, tax advisers

and business consultants.

Through its many years in the business, Bank Gutmann has

developed not only a strong bond with the region but also a

deep understanding of the needs of investors from these markets.

Thanks to its geographical location and very favourable legal and

fiscal conditions, Vienna is an excellent platform for serving inter-

national high-net-worth investors.

Individual one-stop asset management Bank Gutmann offers personal, efficient and discrete customer service.

Solid, customized solutions, security and capital preservation – that is,

the clients’ long-term interests – are top priorities. Gordian F. Gudenus,

The Bank’s partnership concept ensures personal commitment and continuity in customer service

Bank Gutmann CEO Rudolf Stahl about ...

... an owner-managed bank and personal responsibility:“Everything that concerns banking must be handled with utmost

care. Gutmann is an owner-managed private bank – therefore, our

business policy is strongly marked by our partners and our system

of values. Our partners are entrepreneurs and thus committed

to the fortunes of the company and its customers over the long

term. This status breeds a special sense of responsibility. Each of

our clients may trust that one of the partners will feel personally

accountable for their affairs.”

... Bank Gutmann’s special offer in central and eastern Europe:“I believe there are few specialists who offer their private banking

services in central and eastern Europe with as much sense of

purpose and reliability as Gutmann. Customers in this region enjoy

the advantage of receiving services from a Vienna bank that has

always been firmly embedded in the traditions of Western banking

while being able to fully exploit the logistic benefits of being based

in Vienna. There is hardly any major place in the region that cannot

be reached within a few hours. For a long time, Vienna used to be

the eastern-most city of the free world. Now we benefit from the

fact that all decisions on business policy are taken in Vienna, in the

heart of Europe, based on a profound understanding of the east

European market.”

... “Tailoring” instead of “retailing” services to customers:“A good private bank works

for its clients like their family

offi ce. Our approach to serving

customers is highly personal,

with 200 specialists attending

to fewer than 2,000 Gutmann

clients. Instead of selling off-

the-shelf products, we listen

to our customers and fi nd

individual solutions to their

specifi c requirements: which

means we are “tailoring“ rather

than “retailing“. Trust in a

private bank is also created by the right atmosphere and the convenience

it offers. Bank Gutmann boasts Vienna as its attractive base, excellent

logistic links and a special cultural environment, with our account

managers speaking our clients’ languages. This very personal approach

in providing our services has enabled us to compete successfully

against the best international private banks. External experts such as the

international fi nancial magazine Euromoney and the renowned German

publication Fuchsbriefe have consistently awarded us top ranks among

asset managers in German-speaking countries.”

Rudolf Stahl, CEO, Bank Gutmann

deputy head of international private banking and a Gutmann partner,

explains: “We offer attractive services to high-net-worth individuals, en-

trepreneurs and their families. As the leading Austrian private bank with

a strong international focus we offer our customers tailor-made cross-

generational personal asset management. Thanks to the independence

of the bank’s owners, our recommendations are always objective and

not infl uenced by the interests of international fi nancial groups.”

For Bank Gutmann, private banking is more than simply the optimal

management of individual portfolios. The starting point for tailor-

made investment management is a careful analysis of each custom-

er’s current needs and plans for the future. “Our customers can avail

themselves of the services of a strong international private banking

team that is thoroughly acquainted with the markets and operates in

16 languages,” is Gudenus’s concise description of Bank Gutmann’s

multi-cultural competence.

Core competence of portfolio managementGutmann is also closely involved in fi nancial studies and research.

In 2001, Bank Gutmann and the University of Vienna co-founded

the Gutmann Centre for Portfolio Management. Academic advisory

board members include not only numerous professors of notable

international universities but also Nobel Prize laureate William Sharpe,

inventor of the world-famous Sharpe ratio.

In portfolio management, Gutmann works closely with independent

research partners, the Gutmann Centre for Portfolio Management

and the world’s leading securities experts.

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13Modern wealth management with tradition and vision in the heart of Vienna

For further information, please contact:

Bank Gutmann AktiengesellschaftGordian F. Gudenus, PartnerSchwarzenbergplatz 16, 1010 Vienna, AustriaTel: +43-1-502 20-290Email: gordian.gudenus@gutmann.atwww.gutmann.at

The Standard Chartered Private Bank: a new global force in the marketThe launch of The Standard Chartered Private Bank last year and its acquisition of American Express Private Bank soon after made a big splash in the staid world of wealth management

Private banking is often regarded as a staid business where things move

at a glacial pace. The launch of The Standard Chartered Private Bank in

mid-2007 changed that. Not only did the bank open in 11 markets in

just five weeks, it then deepened its network to 30 offices in 17 markets

through the acquisition of American Express Bank in September 2007. A

new – and different – force has clearly arrived in private banking.

“We considered opening a single office before rolling out a broader net-

work,” explains Peter Flavel, global head, The Standard Chartered Private

Bank. “But during the planning stages, we realized that we had the skills

and momentum to create a launch with a scope and scale never seen

before in private banking. Moreover, our entry into private banking was

driven by demand from our existing banking relationships and it made

sense to meet those needs in the fullest way, in the shortest possible time.”

Standard Chartered Bank operates in more than 70 countries across

Asia Pacific, North and South Asia, the Middle East, Africa, Europe and

the Americas. The bank derives over 90% of its profits from the trade

corridors of Asia, Africa and the Middle East, positioning it perfectly to

grow a significant private banking operation. With a presence in nine

out of 10 of the world’s fastest growing markets for private banking, The

Standard Chartered Private Bank has a fertile basis for growth.

Standard Chartered Bank’s existing connections and networks have

largely dictated its target market of high-net-worth first- and second-

generation entrepreneurs. “These people understand world markets

and have businesses and family arrangements that span a number of

countries,” notes Flavel. “They need a bank that can meet their needs geo-

graphically, technically, intellectually and intuitively. We are in the right

markets at the right time – offering the right investment opportunities.”

Crucially, The Standard Chartered Private Bank was able to draw on

the full resources of its parent bank in planning its launch. While many

private banks operate at arm’s length from their parent, Standard

Chartered Bank was eager to put the entire resources of its global

operation at the disposal of its new operation. “Such a collaborative

approach was the only way to achieve the scale of operation we

wanted in a relatively short time,” says Flavel.

More importantly, the decision to use Standard Chartered Bank’s

commercial and other banking operations in the creation of a private

banking business reflects the bank’s broader philosophy of using in-

ternal expertise where

it is most needed.

“Private banking is a

strategic priority for

Standard Chartered,”

says Flavel. “The bank

works as a team

– unlike some banks

where there is little

crossover of resources

– so it was a natural

choice for us to bring

the resources of the

entire bank to bear.”

A perfect fitHaving opened

its doors in mid-

2007, The Standard

Chartered Private

Bank’s acquisition of

American Express Private Bank that September – the deal closed at

the end of February 2008 – dramatically raised the bank’s profile and

expanded its reach and capabilities. The purchase tripled The Stand-

ard Chartered Private Bank’s distribution strength to 30 offices, gave it

a staff of 1,100 and took assets under management to over $35 billion.

“The opportunity to buy American Express Private Bank was too good

to miss,” says Flavel.

The attraction of American Express Private Bank was not just its

client base. The bank used the same back office system as Standard

Chartered Bank, making integration of the two operations much

more straightforward and seamless. Additionally, as a long-estab-

lished operation American Express Private Bank already had a Geneva

booking centre, a trust and fiduciary capability, a discretionary wrap

programme and a web offering that enabled a global account view.

“The Standard Chartered Private Bank had originally planned to spend

two years following the launch expanding its capabilities but Ameri-

can Express Private Bank was a perfect fit,” explains Flavel. “One way

of describing the relationship between our operation and American

Express is that it was long on infrastructure and short on distribution

Peter Flavel,Global Head, The Standard Chartered Private Bank

Offices reflect the heritage of The Standard Chartered Private Bank

whereas we had the opposite position.” In addition, as a result of

the acquisition, The Standard Chartered Private Bank gained a Latin

American operation that extended its distribution.

Executives from The Standard Chartered Private Bank spent several

months on the road in advance of completion of the acquisition visit-

ing American Express Private Bank offices around the world develop-

ing relationships with new colleagues and learning about their opera-

tions. “That period of hard work enabled us to hit the ground running

on 1 March when the acquisition completed,” recalls Flavel.

To that end, when American Express Private Bank offices opened

worldwide on 1 March, each one had a senior representative from The

Standard Chartered Private Bank in place to welcome staff. “The signal

that sent to our new colleagues at American Express Private Bank was

crucial,” says Flavel. “It indicated that the staff in the acquisition were

valued highly and we were fully focused on working together to cre-

ate a better offering for our new clients.”

“With respect to American Express, which is obviously a strong payment

services company, its private bank operation was not at the core of the

business,” says Flavel. “Now its staff are at the centre of a new business

in a dynamic bank and receive all the attention and investment that

implies. Their expertise is being used in a fuller way than in the past.”

Deepening relationshipsThe Standard Chartered Private Bank caters to two high-net-worth

client groups: private banking clients, who typically have between $1

million and $10 million invested with the bank; and key clients, who

usually have more than $25 million in investments at the bank. In

total, The Standard Chartered Private Bank has around 19,000 client

accounts in the 17 markets in which it operates.

The Standard Chartered Private Bank’s sizeable client base is a huge

achievement for an operation that is just a year old. However, it is

important to remember that its parent bank, Standard Chartered,

has first-hand experience of wealth management services over many

years and in many markets. “As a bank, we already have existing rela-

tionships with numerous customers that are qualified to be private

bank clients,” says Flavel. “It is a question of talking to them and show-

ing them our expertise and what we can deliver.”

Indeed, while The Standard Chartered Private Bank is open to new clients

to the Standard Chartered banking network, its initial push to gain clients

is focused on existing bank clients. With a huge client base in consumer

banking, strong small and medium-sized corporate relationships and a

powerful local corporate and multinational company franchise, the pri-

vate bank has plenty to build on. “The long-standing relationships of trust

many people have with Standard Chartered are invaluable,” says Flavel.

“We aim to leverage them into partnerships that are deeper and broader.”

A unique modelThe Standard Chartered Private Bank stands out from other private

banks through its combination of onshore and offshore banking.

While most private banks offer only offshore banking, Standard

Chartered is able to make full use of its existing formidable banking

network – it is the longest established foreign bank in China and

has the largest network of any foreign bank in India.

The ability to offer practical day-to-day banking services, in addition

to the financial flexibility of offshore banking, gives The Standard

Chartered Private Bank customers a unique level of convenience and

integration in their transaction and banking affairs. “Delivering a full

domestic banking service, including local transactions, in the markets

in which we operate is hugely beneficial for clients,” says Flavel. “It just

makes life easier and ensures that The Standard Chartered Private

Bank provides a truly complete service.”

In its offshore banking operation, The Standard Chartered Private

Bank is refreshingly honest about the realities of contemporary

wealth management. “It’s tough to differentiate oneself in private

banking through products,” admits Flavel. “Products are replicated

extremely rapidly in today’s marketplace.” Consequently, Standard

Chartered has decided not to play that game with its private

banking offering.

The bank offers a full service open architecture client proposition that

gives access to a myriad of markets and products. The range includes

liquidity funds and capital guaranteed products, client directed

mutual funds, discretionary portfolios – where professional manag-

ers handle asset allocation and investment selection – and signature

portfolios, which offer a choice of geographic focus and fixed income,

equity or balanced orientation and are managed by investment man-

agers chosen from the best in the business.

THE

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“We realized that we had the skills and momentum to create a launch with a scope and scale never seen before in private banking”

The private bank has 30 offices, globally

Clients can also access structured products, offering exposure to cur-

rency, interest rate, bond, commodity, fund and equity markets. And

alternative investments such as hedge funds and private equity – which

offer exposure to asset classes that are less correlated than equities and

bonds, and form an element of any balanced high-net-worth portfolio

– are also available, as are straightforward investment options such as

foreign exchange trading.

“The point is that we have no internal fund management operation

because we want our clients to have access to the best wealth man-

agement talent in the world, whoever may be providing it,” says Flavel.

“We carefully select the best products in the world – either from single

managers or from funds of funds that represent the best the industry has

to offer. Our extensive array of products is designed to appeal to a wide

range of clients with varying needs and objectives – indeed, some of our

products are eligible to provide margin for a loan.”

Rather than aiming to create every product that a client might require

internally, The Standard Chartered Private Bank is able to focus on ensur-

ing its clients get the leading offering – whatever investment choice they

make – while leveraging its heritage and expertise in dynamic growth

markets to make the right choices for clients. And, most importantly, The

Standard Chartered Private Bank is able to add value – in addition to

gaining access to the world’s leading financial products – by understand-

ing the needs and expectations of its clients.

Perceiving risk and rewardThe Standard Chartered Private Bank has a steadfastly principled approach

that informs its entire wealth management strategy. It aims to develop a

thorough understanding of, and appreciation for, each client’s unique cir-

cumstances and objectives. Then, working with clients to understand their

vision and expectations, the bank’s relationship managers devise a strate-

gic, long-term approach focused on clients’ needs, rather than individual

financial transactions, before recommending innovative financial solutions

that meet an objective assessment of each client’s goals.

Each of these stages of the investment process, which anchor The

Standard Chartered Private Bank’s thinking and the way it interacts

with clients, requires a deep understanding of the mindset of clients.

As a private banking group built around growth markets, the bank has

an unparalleled insight into how its clients perceive risk and reward

and, more generally, how they live their lives. “Approaches to wealth

differ the world over and with operations in Asia Pacific, North and

South Asia, the Middle East, Africa, Europe and the Americas, we are

acutely aware of regional, local and, of course, individual differences,”

says Flavel.

However, while all global private banking markets differ, many that The

Standard Chartered Private Bank operates in have a number of features

in common. Generally, clients in emerging markets have a reluctance to

subscribe to traditional asset allocation models that were designed for

clients who perceive wealth in strikingly different ways to them. “We find

that clients don’t want 25% of their money in markets that would be

chosen by a US private bank, for example,” says Flavel. “In contrast, our

asset allocation models are built around what our clients find comfort-

able in their local markets.”

Similarly, The Standard Chartered Private Bank is able to accom-

modate the investment behaviour of its client base because it

understands their expectations. “Obviously some of our clients have

international lifestyles and might have the same approach to trad-

ing as any private banking client,” says Flavel. “But more commonly,

our clients will have first- or second-generation wealth – which will

have been gained by hard work and being market savvy and being

quite focused on trading.”

Typically, such clients have higher return expectations than tra-

ditional private bank clients. “It is accurate to say that our clients

might be higher on a risk/reward scale than clients in, for example,

Europe,” says Flavel. “What we observe is that they are generally

averse to handing over large sums of cash to a banker – who has

just flown in from head office – before they jet off on long holidays.

They want to be actively involved in how their money is invested

and many are likely to be quite active traders.”

In practical terms, that means that The Standard Chartered Private

Bank relationship managers must be considerably more skilled

than a traditional private banker. “For our clients, this is not just a

feel-good relationship with someone who can be relied on to select

a good wine at lunch and who can help settle family disputes,” says

Flavel. “This is a dynamic partnership with a professional that has

technical competence in multiple markets and asset classes and

who understands investment products, foreign exchange and the

complexities involved in managing a family’s wealth.”

“One way of describing the relationship between our operation and American Express is that it was long on infrastructure and short on distribution whereas we had the opposite position”

Serving youThe Standard Chartered Private Bank delivers great

opportunities and benefits to clients, including:

• An unwavering corporate commitment that focuses on

serving the long-term wealth management needs of

clients and their families through generations;

• A pledge of exceptional client service from experienced

private bankers and the account management team;

• Connecting clients to opportunities in a broad network

encompassing 30 locations worldwide focused on the

growth markets of the world;

• A wide range of wealth management services – from

investment management and estate planning to credit

services and more;

• An award-winning offering – The Standard Chartered

Private Bank was named Global Best Private Bank

2008 by Euromoney, which cited the bank’s strength

in risk management, focus on growth markets, strong

performance, growth in client base and commitment to

client service and advisory as factors in its success.

Seeing through the cycleWhile many emerging markets initially escaped the credit crunch that

began in the summer of 2007, markets across Asia – and to a lesser

extent, Latin America and the Middle East – have come under increas-

ing pressure in 2008 as evidence has grown of a global economic

slowdown. “We remain cautious about the short-term prospects for

global markets,” says Flavel. “There will clearly be more bumps to

come before markets strengthen.”

However, Flavel notes that the fundamentals of many emerging

markets remain indisputably positive. “Growth in the most important

emerging markets – China and India – remains at a multiple many

times higher than OECD markets,” he says. “We still expect 7-9% a year.”

Growth in a number of other emerging markets, such as those in the

Middle East, also remains impressive as many countries in the region

reconfigure their economies – using massive oil revenues – to be less

reliant on oil production in the long term.

“It is vital for clients to have a strong partner that understands when

markets or asset classes are overheating and caution is required and,

equally where new opportunities may be emerging where it’s important

to be an early investor,” says Flavel. The Standard Chartered Private Bank

continually evaluates markets, products and asset managers on its clients’

behalf to ensure that its recommended solutions deliver the results that

clients expect. However, the bank is also keen to help clients see beyond

short-term fluctuations in markets. “We help our clients see through the

cycle because, in the long term, day-to-day timing is insignificant in terms

of returns compared to the long-term returns that can be created by tak-

ing committed views on where value is located,” says Flavel.

In turbulent times clients appreciate the solidity and financial stability

of Standard Chartered, which has a banking heritage spanning more

than 150 years. Rated A+ by Standard & Poor’s, Standard Chartered

recently reported results for the six months ending 30 June 2008 that

showed operating income 33% higher, profit before taxation up 31%

– an interim record for the bank – and total assets 34% higher at $397

billion “We are well capitalized and, as a group, we have a clear and con-

sistent strategy, which is do business in markets we know, with products

we understand fully, with clients with whom we build deep relation-

ships. This is important to clients and the Bank as a whole.” says Flavel.

Future plansWith the acquisition of American Express Private Bank finally com-

pleted in February this year, The Standard Chartered Private Bank has

plenty to occupy it at the moment. “We have plenty of growth oppor-

tunities on the horizon through our existing client base – both clients

that were previously with American Express Private Bank and those

clients of Standard Chartered that are qualified to become clients of

the private bank,” says Flavel.

But while The Standard Chartered Private Bank may be spending

much of the next year further integrating American Express Private

Bank, Flavel says that he is eager to consider new markets for the bank

for expansion. “We’re an ambitious operation – that’s what makes us

so successful for our clients – and necessarily we are always thinking

bigger,” he says. With Standard Chartered in 70 markets worldwide

and private banking currently in 30 locations, there is plenty of scope

for expansion in the future.

Regardless of how, or where, The Standard Chartered Private Bank

grows in the coming years – and it seems certain that it will continue

to be one of the fastest-growing banks in the sector – Flavel says that

the principles that the bank launched with will remain central to its

vision. “Our success has been built on a clear philosophy of wealth

management that reflects the expectations of our clients,” he says.

“There can be no compromise in terms of quality, service, investment

choices or flexibility. We are here to meet clients’ needs.”

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For further information, please contact

6 Battery RoadLevel 27 Singapore 049909

World Citizen Services: Life moves in good companyHigh-net-worth individuals enjoy increasingly mobile lifestyles including business or residences outside their home countries. However, many complexities arise from the multiple legal and fiscal regimes associated with an international existence. World Citizen Services, recently launched by ABN AMRO Private Banking, can offer these clients financial ease abroad

World Citizen Services is an exclusive ABN AMRO Private Banking serv-

ice concept that guides clients through new challenges abroad. As

we see many of our clients moving their lives across borders to coun-

tries like France and Spain, ABN AMRO Private Banking has extended

its existing service with local World Citizen Services offices on the

Côte d’Azur and the Costa del Sol. World Citizen Services is ready to

help clients in any respect: from finding and financing a home abroad

to tips on how to get settled in their new country. Regardless of the

financial requirements, we make sure that all matters are arranged

to perfection in clients’ new countries of residence, so that they can

focus on enjoying their chosen lifestyles.

A local guideLocal support can be invaluable to clients who are expanding their

lives across borders. Our local World Citizen Services teams give

access to their local network, as well as to any financial service in our

global ABN AMRO network, as well as to any financial service in our

global ABN AMRO network – with all the support of a top 10 global

private bank. Our local teams are knowledgeable about local real

estate, legal advice, credit requirements and taxation. They are there

to advise clients on all their questions regarding living in their new

country: from questions about every financial matter abroad to infor-

mation about the region and local market. World Citizen Services can

provide both immediate solutions and long-term arrangements.

Our local teams can speak to the client in his own language. Our

teams speak French, Spanish, English, Dutch and German, and know

best how to get things done in their respective countries. They com-

bine expertise and experience to provide personal, local advice that is

completely customised to a client’s situation and preferred location.

We want clients to experience unlimited enjoyment as they join the

exclusive company of those who have turned their international

lifestyles into an art form.

A home abroad: from dream to reality Where do you start once you have decided to realize your dream of

having a home abroad? World Citizen Services has already helped

many clients purchase homes abroad. The local team has developed

relationships with brokers over many years, and knows the market for

high value home like no other. We know what’s involved in buying a

home abroad and can point out relevant issues for the client.

Together with the client World Citizen Services will look for the best

financing, reviewing all opportunities to find the right solution. For

instance, financing with a client’s own capital is not always advisable. A

mortgage may be more beneficial, for which we can offer various options.

Daily banking easeA move abroad requires adjustments and familiarization with local cus-

toms, traditions and (im) possibilities. This includes banking. Some things

are exactly as they are at home; others are completely different. World

Citizen Services helps clients navigate their new banking environments by

facilitating the payment ease to which they are accustomed. In France, for

example, we can quickly arrange a current account for all banking needs,

including a cheque book, credit card or online facilities. Our service ranges

from a single, simple account to internationally distributed, multiple

account management. Our teams work with the worldwide ABN AMRO

network, allowing a client’s total account management to run smoothly.

“Local support can be invaluable to clients who are expanding their lives across borders. Our local World Citizen Services teams give access to their local network, as well as to any financial service in our global ABN AMRO network. ”

World Citizen Services help ease the complexities of life abroad

World Citizen Services: Life moves in good company

Estate, tax and legal adviceAn international move can have a number of consequences related to

taxes or legal rights. A foreign owner of a French home, for example,

has to take various tax issues into account. He will probably face

double taxation. He may also be categorized differently by the tax

authorities in each of his countries of residence and has to consider a

number of other important issues. World Citizen Services ensures that

the client receives specialized, made-to-measure tax advice from our

international estate planning specialists. They have solid experience

providing international tax and legal guidance to private banking cli-

ents so as to preserve wealth, make optimal arrangements and avoid

any undesirable fiscal consequences.

Exclusive engagementsA new environment often means acquiring new social and commer-

cial contacts and experiences. World Citizen Services welcomes the

client in our network by inviting him for local client activities in France

and Spain. These activities range from golf tournaments to economic

forums. For example, in France we were the main sponsor of the Day

for Change benefit golf tournament at the Royal Mougins Golf Club,

which concluded with an attractive evening programme.

In Spain, World Citizen Services Spain sponsored the Sotogrande

Silver Cup, Spain’s top polo tournament on the Costa del Sol, in 2007.

This year, we were the main sponsor of the Andalusian Dutch Open,

which was held in June on the magnificent course at La Quinta Golf &

Country Club.

In addition to golfing events, World Citizen Services organizes other

activities that range from culture and entertainment to informational

sessions on financial issues, and provide information on third-party

events planned in their areas. All this provides the client with an

excellent opportunity to expand his networks in France and Spain.

Our servicesThese are just some of the ways in which World Citizen Services helps

clients to flourish in their new environments. From insurance to ad-

vice to events, our expertise helps them to move their lives smoothly

and successfully.

For further information, please contact

France: Ab Meijer +33 497 038 332Spain: Marianne de Wit +34 952 90 88 43 www. worldcitizenservices. com

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your dreams our guidance your life abroad our local support

+33 49 70 38 332

your dreams our guidance your life abroad our local support

France: Banque Neufl ize OBC, Palais Marie-Christine, 20 Rue de France, Nice. Tel. +33 497 038 332

Spain: ABN AMRO Private Banking, Avenida Jose Banus, Edifi cio Malaga Local 2-B, Marbella, Malaga. Tel. +34 952 90 88 43

More information at www.worldcitizenservices.com or send an e-mail to world.citizen.services@be.abnamro.com

world citizen serviceslife moves in good company Making more possible

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AA_fullcolourC.epsABN AMRO full-colour for coated paperWidth shield: 20 mmOverlap: 0,05 mm

TechRules: online advice based on experienceTechRules has built on its years of experience in financial advisory services to design an online tool that helps institutions to give their customers the best advice in a cost-efficient way

Founded with the aim of combining extensive financial experience

with the development of new technologies, TechRules has become the

supplier of reference in consultancy and technology for the industriali-

zation of the financial advisory process.

TechRules forms part of a group of companies founded by the Bolívar

family, which provide services in the financial sector: Expert Timing

Systems, TechRules, Efite, Fundación Inversión y Cooperación, Opensea

and Quipu Technology.

TechRules offers financial institutions multi-functional and multi-chan-

nel solutions to improve the customer relationship by making it more

efficient and proactive, not only at the time of sale but also during

subsequent follow-up.

The company provides financial consultancy and the most advanced

technology to improve the quality and efficiency of analysis and advice.

This is the greatest need of all financial institution channels today.

Numerous entities from the national and international financial indus-

try have selected TechRules as their technological partner. Customers

include private banks, retail banks, asset managers, online banks, IFA

networks and family offices.

Integrated solutionUsing its wide-ranging experience in financial advice, TechRules has

developed Tower , an integrated solution that provides financial institu-

tions with the tools to make their business grow by offering customers

quality advice and reducing associated costs.

Designed as a web solution, it enables managers and advisers to

provide a differentiated service by optimizing the generation of invest-

ment proposals, creation, management and follow-up of portfolios and

elaboration of reports.

Tower is easy to use and highly scalable. It enables users to benefit

from a constant desire for functional and technological improvement.

It is a dynamic solution developed with the most modern technology. It

draws on more than 20 years’ experience in financial consultancy and port-

folio management. TechRules understands that technology is only a means

to achieve our main objective: the best financial advice for the customer.

Tower is fully compliant with the regulation in force: MiFID.

Some of Tower’s functionalities:Portfolio ManagerThe Tower portfolio manager enables users to access the most relevant

and updated information on their customers investments, presented

within a homogeneous and dynamic structure. Analysis of the portfolio

returns (following the GIPS® standard), absolute and relative risk, analy-

sis of correlations, asset allocation of the portfolio and origin of profits

and losses, comparison with benchmarks as well as the possibility of

simulating potential changes and even optimising the portfolio.

ReportingA good report offers the opportunity to improve customer relation-

ships by promoting constant communication. The tool allows elaborate

client portfolio reports automatically which increase the process ef-

ficiency: reduction of time and errors.

Model PortfoliosDesigned to help the manager with the construction and monitoring

of model portfolios. Flexible on the definition of components for portfo-

lios, advanced simulation tool and optimisation and very complete

tracking tools.

Investment Profile&ProposalsThrough a centralised system, your company can obtain the customer

profile (appropriateness, investor profile and suitability) and draw up

completely personalised investment proposals starting from an in-

depth knowledge of their capacities, expectations and needs, which are

key for the generation of long-term business.

Client ManagementFull information on your customers with the possibility of managing

commercial activity through a centralised system of personal, financial

and asset information for each one of them.

For further information, please contact

Business Development DepartmentCáceres 228223 MadridSpainTel: +34 91 398 36 73Fax: +34 91 357 50 05Email: tower@techrules.com

Creating value by getting the big picture right With more than 150 years of experience and a dominant position in the Nordic market, SEB is now taking the next step to provide a private banking offering that can compete with top-tier international private banks across the 14 markets where the bank is present

SEB played a major role in the industrial development of the Nordic

region in the last century, as both a credit provider and adviser to

all sectors of the economy. Throughout its history SEB has been

seen as a specialist in asset management and asset advice for

domestic and foreign high-net-worth individuals. SEB Private Bank-

ing manages nearly €32billion, and 28,000 private individuals, trusts

and companies have chosen the bank for its professional wealth

management and high level of service.

Thomas Ericsson, global head of SEB Private Banking, elaborates on

what he believes is the future of private banking: “Our primary goal

is the same as it always has been: to help our clients achieve their

financial goals. We have worked tremendously hard to find new

ways to make this happen. The importance of providing a holistic

customer offering can’t be overstated. “

“Often private banks focus too much on asset management issues. That

starting point might be wrong, not that one should disregard financial

theory and the importance of diversification. Private investors can’t be

handled in the same way as institutional ones. It is surprising that so

little has been done to address this problem. However, at SEB Private

Banking we have addressed this issue in our financial planning process.

This is an in-depth analysis of the client’s total assets and liabilities with

an advisory process that targets client-specific goals and risk factors.

Our modern approach to private banking will facilitate better com-

munication with our clients about complex quantitative issues that are

becoming ever more crucial to high-net-worth individuals as alterna-

tive investments become a greater part of the asset mix. In the end it’s

about finding the right solution for each and every one of our clients.”

Unique platformFew other players can match SEB when it comes to institutional

product resources in the Nordic market. “We have a somewhat

unique platform, with top-ranked analysis and a lot of institutional

products that are of great value for our clients,” says Ericsson. “Our

approach to holistic advice does not in any way mean that we will

not utilize these resources. On the contrary we have intensified

the work of channelling group intelligence and knowledge to our

private banking business.”

For SEB Private Banking this is about providing these products to

clients in the right context. “For example, in our new investment

programmes we can offer our clients the opportunity to invest in

a number of alternative investments and asset classes from across

the globe that are typically not open to other private individuals.

Our clients will benefit from our global relationships, size, purchas-

ing power and our urge to provide state-of-the-art advice. It is

gratifying to see how financial innovations can actually lead to an

investment solution with equity-like expected return but signifi-

cantly lower expected volatility.”

“Our private banking experience is a one-stop shop where the starting point is a thorough analysis of each client’s entire financial situation”

At SEB Private Banking clients can expect a wide range of services

transformed into customized solutions delivered by experienced

staff. Few, if any Nordic private banks can offer the same scope and

depth of solutions as SEB.

Ericsson explains: “Our private banking experience is a one-stop

shop where the starting point is a thorough analysis of each

client’s entire financial situation. We have the capacity to help our

clients with everything from everyday finances to wealth manage-

ment, legal matters, insurance, financing and tax issues. Also we

can adapt the solutions to match individual requirements.”

Open architectureDespite the impressive internal competence, SEB Private Banking

has for long seen the advantages of open architecture and built

up an impressive internal organization for conducting research on

third-party products.

This is natural, says Ericsson. “Everybody in this business should be

humble in the sense that one accepts the fact that competition is

fierce and our number one priority is to make sure that our clients

have the best potential to realize their financial goals. Thus an open

architecture approach with best-of-breed products is essential in

the modern private banking world. But this is nothing new for us.

One must remember that the success of this bank to a large extent

is dependent on the long-term relationships we have had and

continue to have with our clients. Some of our clients have been

with us for generations. This is a great responsibility which we treat

with uttermost respect. It should go without saying that we do all

we can to provide the best possible solutions to them.”

Keeping trackThe small and intimate family office unit is a special team within

private banking with an established track-record of caring for

wealthy families. “It is our aim at SEB to follow our clients in life and

over generations,” says Ericsson. “The family office concept is vast

but is often triggered by an important transition issue such as suc-

cession or sale of the family business. Families often underestimate

how difficult it is to keep track of a diversified fortune and some of

them have the feeling of having lost the big picture of their family

situation. Since we live and breathe these questions and have done

so for more than 150 years it is gratifying to see how more and

more clients appreciate the value added nature of these services.”

Another client group with complex needs which has been in focus

for many private banks is the entrepreneurs. “This is an important

segment also for SEB,” says Ericsson. “For many years we have

worked with entrepreneurs and we can offer specific entrepreneur

services. Often there is a connection between this sort of service and, for

example, our family office offer. Here you can see how we can serve the

client in various stages of life and adapt our value proposition to that.”

For further information, please contact

www.sebgroup.com/privatebankingEmail: privatebanking@seb.se Tel: +46 8 771 - 625 201 SE

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Thomas Ericsson, global head of Private Banking, SEB

“Our primary goal is the same as it always has been: to help our clients achieve their financial goals. We have worked tremendously hard to find new ways to make this happen. The importance of providing a holistic customer offering can’t be overstated. “

The future of the family officeFor centuries, family offices have been offering their wealthy clients special services. The Sal. Oppenheim Group has entered a whole new league with Oppenheim Vermögenstreuhand, which could be described as Germany’s first corporate family office

When entrepreneurial families sell stakes in their companies, they face

a major challenge. They are confronted with a large inflow of liquid-

ity, which they need to invest for long-term success in different areas.

Advice concerning management of these assets becomes increasingly

complex, and the various wishes of individual family members have to

be harmonized.

The owning family of Sal. Oppenheim jr. & Cie. also experienced a large

inflow of liquidity in 1990, when it sold its shares in Colonia-Versicherung.

It founded what is now one of the oldest family offices in Germany to

manage family assets sustainably together across generations –

Oppenheim Vermögenstreuhand (OVT).

In addition to the Oppenheim owner family, OVT now helps more than

50 other families and institutions to organize, continually optimize and

manage their assets. In so doing, the company has developed from a

single family office, with just one client family, to a multi-family office for

a larger number of clients. OVT has grown to the size of a real corporate

family office.

In-house expertiseA key criterion for a corporate family office is the ability to cover a wide

range of issues with its in-house experts, from strategic asset allocation

through equity investments to real estate investments. With a staff of

over 50, OVT can offer comprehensive management even for extremely

complex assets. In addition to traditional family office services, such as

reporting, management accounting and consulting, OVT’s competence

centre analyses investment products and strategies and prepares invest-

ment decisions. This gives OVT’s clients exclusive access to numerous

experts, for instance in real estate or equity investment.

“Family office is an integral part of our holistic asset management ap-

proach. One key aspect is the fact that clients receive one-stop compre-

hensive, neutral and independent advice for all of their assets and asset

classes,” explains Christopher Freiherr von Oppenheim, personally liable

partner of Sal. Oppenheim jr. & Cie. S. C. A. responsible for the asset

management division.

When a family chooses OVT to manage its assets, the first step for the

family office is to analyse the client’s risk profile. OVT then develops an

investment strategy together with the family on this basis. Not until

these parameters have been established will the experts in the OVT

competence centre select asset managers to implement the strategies.

Legal and tax experts are also involved in this process in addition to

the product experts and those in other areas.

Preserving capitalMost families have one requirement in common: Their prime objective

is capital preservation, with the maximum possible return ranking sec-

ond in terms of priority. For this reason, OVT’s primary focus is on limit-

ing potential risk of loss and preserving capital stock after deductions

for inflation and tax payments. To this end, the family office constantly

monitors the success of the commissioned banks and asset manag-

ers. Reporting and monitoring software specially developed for this

purpose allows the amount of success and risks taken by the service

providers to be measured, negative trends to be recognized early and

added value to be created for the client.

One of the greatest advantages of OVT is its independence; the family

office does not produce or market any investment products itself, nor

does it take the role of asset manager. “OVT is in fact an independ-

ent entity which protects and represents the interests of its clients,”

stresses Oppenheim. OVT thus receives no hidden commission; it is

solely financed through its clients’ fees.

Only a corporate family office like OVT can provide such strengths. If a

family forms its own family office, or several families have their assets

“Family office is an integral part of our holistic asset management approach. One key aspect is the fact that clients receive one-stop comprehensive, neutral and independent advice for all of their assets and asset classes”

Christopher Freiherr von Oppenheim, Personally liable partner of

Sal. Oppenheim jr. & Cie

managed by a multi-family office, they are unlikely to have the

necessary volume to give them access to experts on special issues.

But it is this opportunity to identify key questions in advance and

to provide correct and timely answers that is increasingly becoming

the deciding factor in the success of the overall assets. Furthermore,

the asset structures within a family are often very complex. So it is

not unusual for a family to have working relationships with over 30

asset managers. After all, assets usually comprise more than just se-

curities; they may also include real estate, equity investments, private

equity or works of art. And many families are made up of different

branches among which the assets are divided. A sophisticated IT

system is necessary to manage and monitor all of these assets ef-

ficiently and report on them to each individual family member, and

OVT has spent years developing just that.

It is usually more cost-effective for a family to have its assets

managed by OVT than by a single family office, due to economies

of scale, not to mention OVT’s many years of experience of all

management processes in connection with accounting or tax and

legal consulting. Clients pay a flat fee for the services, based on the

complexity of the tasks, not the amount of assets.

Laying the foundationsOVT has been heavily involved in providing services for founda-

tions and similar institutions for many years. “We are seeing an ever-

growing awareness, especially among wealthy families and entre-

preneurs, that foundations are one of the keystones of a sustainable

society,” says Oppenheim. Particularly in Germany, experts are talking

of a real boom in foundations. The Sal. Oppenheim Group manages

assets in Germany of more than 130 foundations with a volume total-

ling more than €2 billion.

OVT offers comprehensive advice; in the case of foundations, it works

with the client’s legal and tax advisers on concepts to realize individual

philanthropic ideas and asset strategies, taking into account specific

requirements of the foundation, such as its distribution focus. In ad-

dition, OVT supports its clients in implementing new or developing

existing philanthropic commitments.

OVT provides individual support concepts for asset investment

– both in administrative management and investment strategy.

Risk management is particularly important in the management of

foundation assets, because the capital stock must be preserved.

Foundations also rely on regular income to finance their cause. A

study recently published by the Berlin-based economic publishing

house Fuchsbriefe on quality and service provided by foundation

advisers placed Sal. Oppenheim far ahead of the competition. In the

conclusion to the study, the experts at Fuchsbriefe write, “At the end

of the day, the winning team from Sal. Oppenheim simply outshone

its competitors in all categories. ”

International approachThe Sal. Oppenheim Group has long followed an international

approach in its family office business. This is due to the fact that

wealthy families are increasingly based abroad, and also make cross-

border capital investments. To this end, Sal. Oppenheim strength-

ened the family office business in spring 2008 with an acquisition in

Luxembourg; the company took over the domiciliation business of

Mercuria Services. Sal. Oppenheim bought trust company SGG in

Luxembourg back in 2005, and plans to merge the new acquisition

with its business in the medium term. In the summer of last year Sal.

Oppenheim opened an office in Hong Kong which also offers family

office services. Furthermore, the family company founded a joint ven-

ture in Switzerland last year with the Dr Landert Group, to reinforce

services for families from Switzerland. “This joint venture in Swit-

zerland and the expansion of our range of services in Luxembourg

allows us to considerably extend our existing offering to our clients

internationally too,” explains Oppenheim.

The private banking group aims to expand its commitment to the

management of larger family assets also in the years to come. Sal Op-

penheim sees this business as an integral component of its holistic asset

management. The focus remains on the clients – they stand to benefit

across the globe from even more comprehensive services.

For further information, please contact

Oppenheim Vermögenstreuhand GmbHOppenheimstrasse 1150668 Cologne, GermanyTel: +49 2 21/1 45-2400Fax: +49 2 21/1 45-9 2409Email: info@ovt. de www. ovt. de Sal. Oppenheim Groupwww. sal-oppenheim. com

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Open Architecture for Quality, Innovation and Excellence in Private BankingMarfin Popular Bank, part of the Marfin Investment Group (MIG) of Companies, was created by the triple merger of Laiki Bank, Egnatia Bank and Marfin Bank to become one of the strongest players in the South Eastern Europe region. Based in Cyprus and with presence in more than 15 countries, this new international bank is developing a strong Wealth Management franchise through its Private Banking Division emphasizing in quality, innovation and client service excellence

Marfin Popular Bank, part of the Marfin Investment

Group (MIG) of Companies, was created by the triple

merger of Laiki Bank, Egnatia Bank and Marfin Bank to

become one of the strongest players in the South East-

ern Europe region. Based in Cyprus and with presence

in more than 15 countries, this new international bank

is developing a strong Wealth Management franchise

through its Private Banking Division emphasizing in

quality, innovation and client service excellence.

Private Banking has been developed based on a phi-

losophy of three main building blocks namely The Hu-

man Capital, Innovative and Independent Products &

Services and State of the Art Technology. High caliber

Private Bankers with international experience & train-

ing have been recruited to offer best in class advisory

and portfolio management services to our clients. Cli-

ent products and services choices expands through a

fully open platform in more than 500 funds selections

from the best of breed global providers that undergo

continuous monitoring and due diligence. The tech-

nological platform comprises one of our strongest

competitive advantages developed to support our

open architecture initiatives and allowing maximum

utilization of private banking talent & skills.

Our Private Banking Products & Services offering

to clients covers the space of Traditional Banking,

Global Investment and Wealth Management. More

specifically the Private Banker which is the single

contact relation between the Client and the Bank

is responsible to deal and accommodate all client

financial needs supported by the entirety of the

MPB Group resources, expertise and know how. In the Traditional

Banking space we include services like money transfers, mortgage

& personal loans, current account management and other similar

traditional banking services. In the global investment area we focus

on delivering innovative solutions through discretionary, advisory

and execution only mandates using global asset allocation models

and individual product selections. Relying on our independent

investment strategy team we exploit our extended third party

funds selection capacity as well as our dedicated structuring desk

to produce maximum value for our clients. Finally, our Wealth Man-

agement Division is responsible to provide solutions to our clients’

special project financing requests mainly through Lombard Loans

and design optimum structures corresponding to clients’ Estate,

Financial and Succession Planning needs.

At present moment we manage E3.6 billion of some 2,500 client

groups in Greece and another E1 billion abroad through a total staff

of 80. Assets under Management developed very rapidly over the last

3 years. In 2005 onshore total AUM did not exceed E300 million to

undergo a tremendous increase of more than 12 times in over just 2.5

years period.

This result confirms our vision and strategy and provides enough evi-

dence that we are in the right path for our further development plans.

Our investment process is driven by client risk profile and cash flow

needs. Periodically we discuss and update client profiles in an effort to

ensure that we keep up with changes in our clients investment goals

and risk appetite. Client profile is the main driver in portfolio con-

struction and management. Our portfolio synthesis philosophy is to

suggest and propose positioning in a set of core holdings accompa-

nied by a satellite subset of investment positions dictated by client’s

tolerance levels to risk for yield enhancement reasons. The main core

portfolio will be positioned in traditional investments with high levels

of liquidity reflecting client’s risk profile and other special requests/re-

strictions for geographic, currency and asset class allocation.

Marfin Popular Bank has an open independent platform of over 500

mutual funds of well known, international investment houses in

its radar screen and through continuous close monitoring depicts

the ones that consistently and repeatedly beat benchmarks and

yield real returns. Our commitment and firm strategic decision is

to continue expanding our client selection potential by adding

established and value enhancing choices in the Traditional and

Alternative Funds Universe. The range of funds expands from the

very common main markets value investment space to the highly

specialized boutiques. A thorough due diligence and fund selection

process which is based on regular reviews of fund performance

and fund management mandates and style has been applied as the

main selection filter for our fund proposals to clients.

For further information, please contact

Marfin Private Bank 24 Kifissias Ave 151 25 Maroussi Athens, Greece D. Manailoglou, Group Wealth Management DirectorD. Scapinakis, Head of Sales Tel. +30-210-8170000

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“At present moment we manage E3.6 billion of some 2,500 client groups in Greece and another E1 billion abroad through a total staff of 80. In 2005 onshore total AUM did not exceed E300 million to undergo a tremendous increase of more than 12 times in over a 2.5 years period.”

At the present markets environment which is charac-terized by volatility hikes, macroeconomic uncertainty, geopolitical risks and low liquidity it seems that a typical equity/bond/cash portfolio or other tradi-tional investments, may not be enough to materialize expected returns and preserve capital. At the same time high deposit rates available in the market that the liquidity crisis has made available from institutions with increased liquidity concerns may also be a threat rather than an opportunity. In this environment our cautious direction to clients is to allocate more funds to cash than usual in order to position themselves for short periods of time exploiting opportunities that exist within an increased volatility environment and control their overall level of risk through specialised short duration products either capital guarantee or partially capital guarantee. Such products will augment the core holdings of an investor’s portfolio ensuring a better long term performance.

Current Investment Climate

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THE BIBLE.NOW WITHMOREREVELATIONS.Euromoney has always been chapter and verse on global capital markets. Now it gives you more. There’s more coverage of core market sectors and regions (and most issues, niche markets too). There’s more uncoverage – of the people behind the news, and the stories that are ahead of it. Stories that go deeper, because we get in higher. There’s more colour. And more opinion – from columnists who are as sharp on the markets as they are in their prose. If markets are your passion, take a look at what we’ve done with Euromoney.We think you’ll fi nd it a revelation.

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Banco Urquijo’s undisputed reputation as a benchmark of private

banking excellence is backed by more than 130 years of history.

The bank’s new focus on wealth management, on the back of its

acquisition in 2006 by Banco Sabadell Group - the fourth largest bank

in Spain - is already reaping benefits; in 2008 Banco Urquijo was recog-

nized by Euromoney as the second best private bank in Spain.

With the aim of adjusting client investment portfolios to current

market conditions and reducing the overall risk, Banco Urquijo advises

its clients to diversify their investment portfolios with structured

products and alternative investments.

Thus, one of the bank’s main aims

is to preserve capital. Nevertheless,

even in uncertain times, good invest-

ment opportunities may arise. So the

goal of Banco Urquijo is to focus on

monitoring its client’s portfolio risk

and to seek investment opportuni-

ties that diversify and reduce the

overall risk of its client portfolio.

Uniquely efficient market portfolioWith regard to alternative investments, Banco Urquijo dedicates a great

deal of time and effort to analyzing and selecting best-in-class products

for this type of investment. Consequently, it is able to offer clients a

selection of exclusive products such as private equity, real estate and art

funds, private equity funds of funds, hedge funds and funds of hedge

funds. Banco Urquijo is involved in finding real estate investment op-

portunities, paying special attention to the geographic area, the type of

investment (property development/property-related assets), as well as

the type of market (residential, office, shopping mall).

Another key alternative investment target has been renewable energy,

in particular wind power. Banco Urquijo recently launched a private

equity fund aimed at investing in Polish wind farms, taking advantage

of one of the fastest-growing economies that has recently joined the

EU and a new regulatory framework that favours this type of energy by

offering a very attractive yield (10% higher than the average EU yield).

Banco Urquijo offers an extensive range of structured products with

different risk profiles linked to a wide range of underlyings such as

stocks, bonds, currencies, commodities, inflation, indexes and hedge

funds, all with different time horizons.

This new phase of Banco Urquijo’s development underscores its strong

commitment to building up long-term relationships with its clients. Its

approach of delivering a uniquely efficient market portfolio with a 360º

relationship with its clients, while meeting each client’s risk profile and

providing an integrated range of products and investment solutions,

has paved the way for Banco Urquijo to be placed first in 13 categories

of the 2008 Euromoney best private banking awards in Spain.

Dedication and innovationIt is in this uncertain economic environment and increasing market volatil-

ity that Banco Urquijo’s long-standing commitment towards understand-

ing and meeting its clients’ needs comes into its own. To achieve this goal,

Banco Urquijo provides an integrated

range of products and services adapt-

ed to current market conditions.

The discretionary asset management

service provided by Urquijo Gestión

(Banco Urquijo’s asset management

unit) ensures that its client invest-

ment portfolios are professionally

managed by a team with a proven

track record. In collaboration with

the client’s private banker, the invest-

ment manager draws up a client risk

profile and the client’s portfolio is managed accordingly. Banco Urquijo

has developed its own innovative risk management tools to ensure that

each client portfolio is managed within its risk profile framework.

Banco Urquijo’s client portfolios are the result of its open architecture

policy and a team of product specialists (one product specialist for

every two private bankers) who implement this policy by analyzing and

selecting best-in-class products and by providing technical support to

private bankers so that they can focus on strengthening their relation-

ship with their present clients and gaining new ones.

By building up this team of product specialists, Banco Urquijo has been

able to position itself at the cutting edge of the Spanish private bank-

ing Industry, providing close support to private bankers and clients.

Specialist approach allows Banco Urquijo to weather market volatilityIn an uncertain economic environment, with increasing market volatility, Banco Urquijo’s long-standing commitment towards understanding and meeting its client’s needs comes into its own

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