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.