The strategic decision to merge our Swiss and Liechtenstein banks matured a long time ago
Banque Havilland (Liechtenstein) AG can look back on another good business year. This obviously whets the appetite for more. With the merger of the Swiss and Liechtenstein organisations, the bank wants to grow further, as Marc Arand, who has now been promoted to Group CEO, explains.
BY HOLGER FRANKE
“Volksblatt”: Mr. Arand, the annual profit doubled last year to around 3 million Swiss francs, and assets increased by 11 percent to 1.1 billion Swiss francs – how would you sum up the past year?
Marc Arand: Basically, we are very satisfied with the development, because all income pillars contributed to the improved annual result. We were able to increase both interest and commission income, with only a moderate rise in costs. We are very proud of this result, because the revenues can only be increased with good service and happy customers.
“In a great team effort, we have succeeded in bringing the subsidiary from loss to profit in my first year.”
You left the Bank as CEO at the end of March and have been working as Group CEO of the parent company in Luxembourg since 1 April. What led to this change?
When Banque Havilland S.A. was founded, I was in the fortunate situation to be part of the transaction team and therefore I know the group very well. For the last 6 years, I have had the privilege of leading Banque Havilland (Liechtenstein) AG as CEO and at the beginning of my tenure, the bank had been loss-making for several years. In a great team effort, we succeeded in bringing the subsidiary from a loss into the profit zone already in my first year in office. Of course, this development was also noticed by the board of directors in the parent company and I was recently asked whether I wanted to lead the the group. Although, I am now strongly linked to Liechtenstein, the enhanced power to influence the group, being in the parent company, ultimately convinced me. It is foreseen that I remain on the board of Banque Havilland (Liechtenstein) AG.
Banque Havilland Group has decided to merge its private banking activities in Switzerland and Liechtenstein while maintaining and developing its activities in both countries. What is the background to these plans?
Banque Havilland Group currently operates in Switzerland through Banque Havilland (Suisse) S.A. and in Liechtenstein through Banque Havilland (Liechtenstein) AG. Both banks are subsidiaries of Banque Havilland S.A. in Luxembourg. The banking market has been undergoing material changes for many years. Rising operating and administrative costs are additionally are facing declining earnings. We believe that the time has come to create a new, sustainable and financially strong bank in the Swiss franc region by merging the two banks. We want to bundle our strengths and unite our strengths in order to be able to serve our clients across generations. After the merger, the combined institution deliver not only sustainable market coverage, but also growth in the market. The merger is subject to final approval by the supervisory authorities, in particular the Swiss Financial Market Supervisory Authority (FINMA).
What other goals have Banque Havilland Switzerland and Banque Havilland Liechtenstein set for the planned merger?
The merged organisation will position itself even more strongly as a modern, efficient financial partner. The strengths of the two banks are to be further developed in the future and complement each other. In the course of the merger, we naturally have our customers in mind, because we want to intensify customer relations and strengthen customer satisfaction with this transaction. Through synergy effects, we can strengthen our distribution power on the long term and strive to expand our market share in Liechtenstein as well as in Switzerland.
What makes you so sure that you will be able to achieve the ambitious goals you have set?
Due to the geographical proximity between Liechtenstein and Switzerland, but also due to the good development of Banque Havilland (Liechtenstein) AG, we are convinced that we will achieve the goals. The strategic decision to merge the banks has matured over time and was of course accompanied by strategic measures. I have no doubt that with our highly motivated team we will implement these measures and make the strategy a success.
“We believe that the time has come to create a new, sustainable and financially strong bank in the Swiss franc region by merging the two banks.”
A merger usually also brings changes. What changes will there be for your employees and for your customers?
The activities of Banque Havilland (Suisse) S.A. will be combined in the current Zurich branch, which will become “Banque Havilland (Liechtenstein) AG, Vaduz, Zurich Branch” after the merger. We will close our second location in Geneva, which will of course affect some employees. Banque Havilland (Liechtenstein) AG will assign the business transferred from Banque Havilland (Suisse) S.A. to its newly established branch in Switzerland, which will serve the transferred clients of Banque Havilland (Suisse) S.A. from its existing office in Zurich. We are convinced that this change will not affect the client experience.
The war in Ukraine is currently forcing many companies to rethink their business with Russia. How is Banque Havilland involved in Russia?
First, I would like to say that I am very sad about the developments in Ukraine. Fortunately, here in Liechtenstein we only have to deal with the economic consequences, but my thoughts are with the families who are suffering from the war. In our strategy, we did not put much emphasis on direct clients in Russia. Like all banks, we are of course busy implementing and complying with the sanctions. This requires good planning and execution. However, the public often mixes things up when it comes to this topic. Today, the sanctions do not only cover named persons and companies, but the packages go much further. I do not want to criticise the measures, but I want to make it clear that not only banks that have accepted assets from so-called “elites” in Russia are affected, but all financial market participants, which come into contact with Russia in one way or another.
We are currently living in extremely turbulent times. How do you assess the current challenges in the current year with regard to Banque Havilland’s business?
The global economy was in a recovery phase after the first impact of the Corona crisis, but at the same time, we saw rising inflation rates. Inflation is now being fuelled by the Ukraine conflict. At the same time, central banks are struggling with their decisions and weighing their options. For several weeks, key interest rate hikes have been considered or have already been implemented. However, the high government debts that have accumulated due to the fiscal policy during the economic crisis complicates the situation. In this difficult environment, our clients appreciate our advisory services even more in order to make the right investment decisions. Furthermore, we should not forget that there is a constant generational change in the distribution of wealth. Today, private banks often have to deal with young and, above all, technically advanced and well-informed clients. This also increases the demands on the innovation capacity of the bank and on each individual employee to meet the needs of the customers. The banking sector is one of the areas that is very strongly affected by innovation through digitalisation. The overall innovation in the digital world is unprecedented. Therefore, innovative decision-makers need to monitor developments and measure their own performance against these developments. Due to the increasingly short-lived nature of technology, banks need to be able to make decisions and implement them just as quickly. Banque Havilland Group enjoys advantages through its organisational structure to meet this challenge and implement appropriate measures to be prepared for the future.
( source: Volksblatt (German version))