The Syz banking group, 26 billion francs under management, recorded a net loss of 8.2 million last year, according to a selection of figures made official Tuesday morning. This is three times less than in 2019, but the reasons for the red figures are identical: the reorganization of the Geneva group and the consequences of, announced at the beginning of 2020. Among the three activity poles, private management (14 billion under management) generated a net profit of 4 million francs last year, according to information from the Time, confirmed by Syz. Asset Management is described as “profitable” while activity focused on alternative investments would not be far from balanced, according to the group, which does not provide more detailed figures.
2020 was the third year of the reorganization of the Syz group. It will be the last which will have negative consequences on the financial plan, assures Eric Syz. The fund business practiced under the Oyster brand, sold in early 2020, continues to have a cost, says the founder and chairman of the group: “In the context of low interest rates, it has become increasingly difficult to beat. continuously benchmarks, explains Eric Syz. Competition has also increased, with the arrival of new players and the development of ETFs, while the Oyster fund model involves a very wide distribution, with significant costs. It is for these reasons that we decided in mid-2019 to withdraw from this activity. ”
The buyer, iM Global Partner, acquired all the funds and the Oyster brand. But the group had to reduce fixed costs, “decommission the machinery”, according to the expression of our interlocutor. In particular with a social plan for around twenty people in mid-2020, but also with costs relating to IT or systems. Asset management is now limited to a Zurich team of five dedicated to Swiss institutional clients, which manages CHF 10.5 billion.
Launched in 2018, the alternative investments of the Syz group currently manages 1.5 billion. The Syz Capital entity offers private equity as a co-investment with the founder’s family, for example in the financing of legal disputes or maritime logistics. The entrance ticket is 100,000 francs for group customers, or 1 million for non-customers. “The key element remains the possibility that we offer our customers to invest alongside us, the added value that we provide, with performance, local service and different products”, summarizes Eric Syz.
Make pay for the added value
This service comes at a cost but some clients recovered during the acquisition of the Swiss entity of Royal Bank of Canada, announced in mid-2015, were used to floor fees. “Some were therefore asked to find another bank last year”, continues our interlocutor. As a result, net capital inflows were negative last year (the group does not specify a figure). Management performance is described as “strong”, and the investment grade capital ratio exceeds 27%.
Asked about the Compass affair, this Geneva independent manager who lost all of his clients’ funds, which were partly deposited with Syz. Eric Syz did not answer our questions, except to recall that “this independent manager took management decisions, the bank cannot be held responsible. People who give information to the press want to put pressure but I will not give in to blackmail. “