Pictet & Cie of Switzerland, the world's 11th-largest private bank in terms of assets under management, has set up a branch in Hong Kong to foster its expansion into Asia.
The bank has been operating in Hong Kong for 26 years as an investment company and regulated by the Securities and Futures Commission.
Claude Haberer, the Asia-Pacific head for Pictet Wealth Management, said the bank gained its full banking licence last month.
It expects to hire more local staff to handle the reporting and regulatory requirements.
"Without a branch, we could not book our customers' business here," Haberer told the South China Morning Post. "This shows our long-term commitment to our clients."
He said the growing number of millionaires on the mainland had made Hong Kong an attractive market for Pictet.
"Many mainland millionaires are still young, but some of them have started thinking of ways to transfer their wealth to their next generations," he said. "Pictet is in a good position to give advice like that as we served many families for many generations."
Two of the partners that own the bank are from the Pictet family and the younger one, Marc Pictet, is a ninth-generation member. Haberer said it showed Pictet was a good example of a successful succession story and disproved the Chinese saying that "wealth could not be passed through three generations".
Although Pictet has a full banking licence, Haberer said it had no intention of expanding into retail or corporate banking. "Pictet has always focused on providing wealth management and private banking services for high network clients," he said.
Founded as a partnership in Geneva in 1805, Pictet is still owned and managed by eight managing partners who stand personally responsible for the bank's liabilities. Headquartered in Geneva, it has 3,000 staff and manages US$400 billion for customers. The minimum asset requirement for its private banking clients in Asia is US$3 million.
Besides Switzerland, the bank also operates in 20 markets in Europe and Asia. Its institutional and mutual fund asset management business has an office in Tokyo.
Looking ahead, Haberer said the bank would like to hire veteran bankers.
"We want people who have at least 15 years of experience in private banking. They also need to have long-term vision," he said, noting that Pictet was a closely held concern that did not need to chase quick profit to satisfy public shareholders.
On the investment side, Haberer expects the low interest rate environment to continue, which will lead to more investment demand.
"When bank interest rates are close to zero, it would be natural for clients to seek independent investment advice to achieve a better return," he said. "Bonds have performed well this year, but the price may be too high now. High-dividend-yielding stocks of companies with solid balance sheets may look attractive now."Topics: Private Banking Asia Pacific Business