Summit Notebook

Exclusive outtakes from industry leaders

Napolitano defends bringing Guantanamo detainees to U.S.

Photo

Department of Homeland Security Secretary Janet Napolitano defended the Obama administration’s plans to bring terrorism suspects held at Guantanamo Bay, Cuba, to the United States — countering critics who questioned whether it would create security risks.

“There’s no question in my mind that those detainees who would be moved to the United States would be held in such a fashion that they would not be any threat to public safety, and I say that as a former prosecutor,” Napolitano said in an interview during the Reuters Washington Summit. She served as a U.S. attorney in Arizona during the Clinton administration.

President Barack Obama has pledged to close the controversial prison by Jan. 22, 2010, including bringing some of the terrorism suspects to U.S. soil for trial in military commissions or U.S. criminal courts. There have been questions and doubts about whether his goal can be achieved because of political, legal and logistical complications.

Napolitano held out hope that the administration could meet the fast-approaching deadline: “I would hope so.” She declined to comment on the likely location of where the detainees could be held in the United States.

Senator Levin: partisanship has no place during war

Photo

A war of words over U.S. policy on Afghanistan is heating up between Democrats and Republicans on Capitol Hill as they await President Barack Obama’s new strategy.

“This kind of partisanship in the middle of a war I find to be really out of place,” Senate Armed Services Committee Chairman Carl Levin, a Democrat, said.

Time private bankers got professional

It’s hard to imagine that a banker who represents multimillionaires would be anything but professional – but a top executive at a leading global bank thinks that’s precisely the wealth management industry’s problem.

“There is so much mediocrity in the industry we have to raise the bar here,” said Gerard Aquilina, vice chairman of Barclays Wealth, at the Reuters Global Wealth Management Summit in Geneva.

Everyone needs a private banker

Everyone needs a private banker. Full service means exactly that for one speaker at the Reuters Wealth Management Summit. The ’normal’ range of extras that wealth managers are offering super-rich clients under the banner Lifestyle Management has expanded as they scramble to keep on board clients whose massive wealth was rendered a little less massive during the financial crisis.   Citigroup’s private banking arm keeps an art curator on staff to make sure clients don’t overspend at auctions and maximise the value of their collection – it’s a real problem apparently.   But one of the smaller banks represented at the summit goes a lot further than that. “We do pretty much whatever they want.” On further investigation this stops short of walking the dogs but it does include managing fleets of vehicles, relocation for tax exiles, school selection for the rich in-waiting, wine cellar stocking, art advice (of course) and payroll services for the hired help.   But what was the most unusual request he has ever had from a client? “We were once asked pick up some strange medication and we organised the redecoration of the interior of a private jet in questionable taste,” said one private banker. He wouldn’t say any more, but some might think that was too much detail already.

Tax evaders on the run

  By Neil Chatterjee
    The U.S. has promised it will hunt down tax evaders.
    And it seems tax evaders are on the run.
    DBS bank, based in the growing offshore financial centre of
Singapore, told Reuters it had been approached by U.S. citizens
asking for its private banking services. But when told they would
have to sign U.S. tax declaration forms, the potential clients
disappeared.  
    Swiss banks also approached DBS on the hope they could
offload troublesome U.S. clients to a location that so far has
not been reached by the strong arms of Washington or Brussels.
    DBS said no thanks. In fact many private banks and boutique
advisors now seem to be avoiding U.S. clients.
    Will this spread to other nationalities, as governments
invest in tax spies and tax havens invest in white paint?
    Is this the end of offshore private private banking?

Private bankers chanting new mantra

Private bankers still getting their ears bashed from clients enraged about massive portfolio losses now are chanting a new mantra.

    Murmur along with me, those seeking inner peace and appeased clients: the word is “holistic”.

Investment tales from private bankers

Photo

By Neil Chatterjee

Top private bankers are no different from the rest of us when it comes to looking after their money.

Some, such as Citigroup’s head of investments in Asia and ex-Lehman banker Debashish Dutta Gupta sold everything when his former employer went bust. Others held on and took the paper losses, before increasing their fixed income exposure and slowly edging back into equities this year.

from Blogs Dashboard:

Count on it: in three generations your rich client will be poor

It turns out that advisers to ultra-rich aren’t always so flush themselves. So, what happens, if, say, you spend a day on your client’s fancy yacht, then go back to your own tiny dinghy?

It’s simpler, more elegant . . . or just smaller.

“It’s an awkward position you’re in when you’re dealing with high net worth individuals and families because even if you have a pretty nice lifestyle at home you go on a trip and visit three or four clients and you come home at the end of the day and say, ‘Wow, how do I suffer through this five bedroom house and four bathrooms, and woe is me,’” BNY Mellon Wealth Management Managing Director of Family Wealth Services Thomas Rogerson told the Reuters Global Wealth Management Summit in Boston.

Private Bank finds synergy in public bar

It is a little known fact that private bank Wegelin, Switzerland’s oldest bank is also active in the bars and restaurants business.

In its ‘Nonolet’ bars – a play on the Latin saying pecunia non olet (money doesn’t stink) – in St. Gallen and in Geneva, hedge fund managers and other financial professionals rub shoulders with other locals in the early evening over sparkling wine or champagne and snacks.

Swiss brand key to banks’ cache

One question kept coming up when I announced four years ago that I was moving from Washington to Geneva: ”Will you get a Swiss bank account?” There is an unmistakeable international cache surrounding Switzerland’s financial sector, whose infamy as a hiding place for Nazi gold has given way to Hollywood mystique about secretive numeric codes cracked by Da Vinci Code protagonists and James Bond.  But within the small Alpine country, which remains stubbornly outside the European Union despite sharing borders with France, Germany, Austria and Italy, bankers are in fact celebrated for being as dull as they are discrete.  Christian Raubach, managing partner of Switzerland’s oldest bank, Wegelin & Co, told the Reuters Wealth Management Summit that the biggest Swiss banks rely on their “Swissness and security and boringness” to attract clients from abroad. Guillaume Lejoindre, managing director at the Swiss private banking arm of France’s Societe Generale, said it was precisely this reputation that made Switzerland such a powerful financial power, even in an age when total secrecy has been abolished and big institutions like UBS admit to taking big risks akin to those that took down Lehman Brothers.  Droves of Saudi and Gulf banking clients file into Geneva to spend the summer with their families every year and wealthy Latin Americans are also clearly inclined to store their funds in Switzerland to try to make them less likely kidnapping and extortion targets. The strong overall brand means that the banks can charge a premium over other centres and also continue to draw in new funds even in dark economic times.  “What is the price of trust and confidence? What is the price of expertise? We all know that a Hermes bag is more expensive. Is it a problem? I don’t think so,” the Societe Generale executive said.  In this way, much like Swiss watches, Swiss hotels, Swiss chocolate and Swiss beauty creams, the biggest asset even the most endowed Swiss bank has is clearly its brand — which may actually hold more value internationally than at home.
  •