Financing solutions from BNP Paribas in Switzerland: a plus for external wealth managers
The value of money has been restored in recent months, and the cost of borrowing has soared. To curb inflation surges in September, the SNB raised its key interest rate to +0.5% through a significant 75 bp increase, putting an end to nearly eight years of negative rates. With this hike, the SNB mirrored the trend seen across most of the leading central banks including the ECB, which has added 200 bps to its interest rates since the summer. This widespread tightening of monetary policies, due largely to post-Covid supply chain bottlenecks and the Ukraine conflict, obviously weighs on credit markets. The brakes are on for both consumer spending and the loans that sustain it.
So now more than ever, the ability to devise effective financing solutions suited to every profile is a key factor in client relations. This is where BNP Paribas Wealth Management in Switzerland comes into its element.
BNP Paribas Wealth Management can address ever-more-sophisticated demands. Whether the assets are financial or real, teams work within a vast space and can implement highly structured financing solutions with maximum customisation.
Solutions include Lombard loans, home and building mortgages, and the financing of illiquid assets.
For example, Lombard loans can be used to finance individual projects or leverage an investment portfolio. The amounts granted depend on the value of the assets eligible for a loan.
The mortgage range covers both residential and business offers. In strict compliance with cross-border rules, it extends to properties located in several countries in Switzerland or abroad. It may concern a first or second home, a rental property to diversify a portfolio, or equity release.
The teams’ knowledge of Corporate & Institutional Banking also allows the Group to offer bespoke financing secured with less liquid assets. Private equity, the cornerstone of entrepreneurial wealth, tops this category, especially for cash-flow financing and bridge-to-IPO loans. The Group can also consider shares in private equity funds as collateral for credit facilities. Each individual scenario is analysed on a case-by-case basis to provide clients with the best possible support and the perfect answer.
Looking beyond its own clientèle, BNP Paribas in Switzerland offers the same financing solutions, and the same level of service, to independent wealth managers and multi-family offices wanting to add this kind of arrangement to their offering. Indeed, new regulations in January, turbulence on the markets and the inevitable squeeze on margins are forcing wealth managers to expand their range.
For them, customer relations management increasingly means adding new value-adding services. Financing solutions are one example of this. The opportunities that they create are particularly attractive as independent managers and multi-family offices are able to seize them while using the resources provided by BNP Paribas. This allows them to expand and enhance their offering by including quasi-institutional billing services for the benefit of their clients.
Raphaël PRETRE, Head of External Wealth Managers & MFO, BNP Paribas Wealth Management Switzerland
Raphaël Prêtre heads the Independent Wealth Managers department of BNP Paribas in Switzerland. After graduating from the University of Geneva in 1994, he spent five years working for the PricewaterhouseCoopers group. In June 2000 he joined Paribas, which later became BNP Paribas, in the Independent Managers department. A business connoisseur, he shares his expertise with Bank clients and the different BNP Paribas group entities on a daily basis.
Interview edited by AllNews