You are creating jobs abroad?
It is regrettable that we have to create jobs outside Switzerland, but as we can't do the business from this country and as we have to be close to our clients, we have to invest outside our home market. The bank in Luxembourg now has branches in France and Spain, important markets for Mirabaud.
«Dubai is our hub»
We also have an important presence in the Middle East, covered from our branch in Dubai. We decided to reinforce our presence in the Middle East rather than move into Asia. Dubai is a hub wherefrom we can cover the Gulf, the Indian subcontinent, parts of Africa and the former Soviet republics. We also have, for historic reasons, a presence in Canada.
As the tax dispute with the U.S. is drawing to a close, certain banks have already moved back into that market again. Could the U.S. also be of interest to you?
As long as you respect the rules, the U.S. is one of the most open markets to work in. Once you're registered you can do business with some of the richest people in the world. However, you still need a proper organization to do so. We considered our options and decided that we currently have other priorities. We can't do everything. This may be one of the problems of small banks, but also a strength, because you concentrate on what you know best.
And Asia?
The same is true of Asia of course. We concluded some years ago that we may perhaps not be best prepared for that market.
First of all you need to hire the right people. And the typical Asian banker isn't always loyal to his employer, he's sort of a mercenary. So, salaries are very high for the good people.
«The customer in Asia tends to be buy-and-sell»
Second, the customer is traditionally demanding something very different from what we're offering at Mirabaud. He is oriented towards trading, and while we are long-term oriented, buy-and-hold, the customer in Asia tends to be buy-and-sell.
And third, we are not a commercial bank and don't have loans on offer for those who want to leverage their portfolios.
So we concluded in 2009 that we were better off reinforcing our presence in the Middle East than entering the Asian market. That doesn't mean we will never go there, but not for the moment. I believe that it is very difficult to make money in Asia. The big banks probably earn well enough, but for small banks business in Asia is certainly a heavy investment.
The CEO of Credit Suisse, Tidjane Thiam, said you had to invest to survive. How can you invest and survive without cutting costs?
We're investing continuously. The money of the associates of Mirabaud remains within the bank and though we earn a decent enough living, we are using our money to invest for the better of the bank. Not by acquiring other banks but by attracting talent and developing our services.
Naturally, in the rare case of a bank that would perfectly fit our institute, yes we could buy, but it will remain an exception. We did it when we bought Banque Jenni in 2004, but our way is to grow internally, by attracting good people and not through acquisitions.
Isn't it particularly difficult for smaller banks to keep costs under control as regulatory demands increase at a time when profits are harder to generate?
Absolutely. That's why we fight against the trend of «one size fits all» in regulatory matters. We need regulation that is adapted to the size of the companies. Even though Finma says it is aware of the problem we still are sometimes surprised about the decisions taken about rules that penalize smaller institutes much more than bigger.
It is also reflected in the way the central bank applied the negative rates. Some banks are much harder hit than others. The effect on banks with extremely solid balance sheets, with no commercial activity and who take smaller risks is much greater than on the big banks and the commercial and cantonal institutes, who all take much greater risks and have a less liquid balance sheet. The big banks so far paid no negative interest at all. The cantonal banks almost none. This is not the case for private banks.
«Distortion of competition»
Here we have a distortion of competition by an administrative decision that has an impact on the banking industry in Switzerland.
