Insights - Issue 12

From summer into autumn

As summer draws to a close and the first hints of autumn appear on the horizon, we present to you a new edition of Insights.

In this edition we take a closer look at the macroeconomic events that have significantly shaped the global financial landscape in recent months, resulting in significant changes in our asset allocation. Within this context, we explore the role of dividend stocks as a potential strategy for effectively navigating the challenges posed by inflation and recessionary conditions.

We are also delighted to bring you an interview featuring our Front Office Heads in Geneva and Zurich, Gabriel Gascon and Andreas Feller. They share their experiences of preserving wealth in an ever-changing world. Additionally, we spoke to Jonathan Levy and Giovanna Lagutaine, respectively our art curator and Market Head Swiss Onshore, as we delve into our remarkable in-house art collection and the latest in the art markets.

Shifting gears, our equity research team takes us on a road trip to the US, unveiling the potential and prospects of various industries.

Lastly, we venture into the realm of private markets, which has become a staple element of a well-diversified portfolio.

As the pages of this publication turn like the changing seasons, we hope you enjoy this edition of Insights and wish you a wonderful autumn!

Warmest regards,

Laurent Gagnebin
CEO, Rothschild & Co Bank AG

There are many myths surrounding private banking, an industry which has not only witnessed significant developments in recent years, particularly with the emergence of artificial intelligence, but which has also grappled with evolving client needs in an ever-changing complex financial landscape.

In an interview with Andreas Feller (AF) and Gabriel Gascon (GG), we find out whether these myths are justified, explore the key changes likely in the years to come and discuss how we can assist our clients with navigating complex market environments.

Q1. In your opinion, what distinguishes Rothschild & Co (R&Co) from other banks?

GG: We are a family-owned bank and this fact truly sets us apart. At R&Co, corporate and family interests are seamlessly aligned, complemented by the high-quality service we deliver. We have been advising families with substantial wealth for over 200 years, and we grant access to an unparalleled global network of expertise, including our Merchant Bank^[1] and Global Advisory^[2] businesses, which are an integral part of our heritage.

AF: What also truly distinguishes us is our core area of expertise: providing advice. Whether it’s in advisory services or investment banking, our DNA is deeply rooted in the art of counsel, which is a tradition passed down through generations. This sets us apart from many of our peers that primarily focus on launching financial products and funds.

Q2. In what ways has artificial intelligence transformed private banking?

GG: I believe artificial intelligence (AI) will have a similar transformative power as the internet had in the early 2000s. It will reshape our work processes and require us to invest in new technologies to ensure we offer our clients the highest level of service. At the same time, I don’t anticipate it altering the fundamental way private banking forges client relationships. Private banking is a people-centric industry, rooted in personal relationships and trust. While technology is a powerful tool to support and enhance our service, it will not replace the human interaction.

AF: I agree with Gabriel. Technology can never replicate the depth of a human relationship built over years of trust and meaningful interactions. I have personally navigated through numerous global financial crises in my career and while technology may produce superior charts and data analysis of the 2008 financial crisis, it cannot convey what it was like to live through it. I managed portfolios, experienced the emotions and supported clients, and today I can offer valuable advice to my clients based on those lessons learnt. This is where technology inevitably falls short.

_{[1] Merchant Banking is the investment arm of Rothschild & Co which deploys the firm's capital, alongside that of a select set of leading institutional and private investors.
[2] Global Advisory offers mergers and acquisitions, debt advisory as well as equity markets solutions.}