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Investment bankingApril 1 2014

Is private banking a global or local game?

Recent years have seen private banks hit by heavy regulation, fines and spiralling compliance costs, all of which have taken their toll on profits and brand value. As banking groups redefine their exposure to wealth management across the world, will private banking become a game better played by local and specialised names?
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Is private banking a global or local game?

The retreat of US giant Merrill Lynch from international wealth management two years ago is a high-profile example of the challenges that private banks have been facing since the financial crisis. New regulation from the US to the EU and other jurisdictions have made wealth managers’ offshore models crumble.

Private banks need to ensure international clients’ investments comply with the rules on taxation and consumer protection in the jurisdictions where products are sold. New rules have also hit wealth managers who are having to correct past behaviour and, in some cases, pay heavy fines.

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Silvia Pavoni is editor in chief of The Banker. Silvia also serves as an advisory board member for the Women of the Future Programme and for the European Risk Management Council, and is part of the London council of non-profit WILL, Women in Leadership in Latin America. In 2019, she was awarded an honorary fellowship by City University of London.
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