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Features - July 2017

 

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Match made in paradise

Match made in paradise

The Bahamas branch of EFG ramps up offering as it acquires BSI

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The Bahamas Investor Magazine
August 21, 2017
August 21, 2017
Catherine Morris

With an anniversary, a move and an acquisition, EFG Bank & Trust (Bahamas) Ltd is having a busy time of late. In 2016, as it celebrated 10 years of operations in The Bahamas, the bank’s parent company Zurich-based EFG International acquired fellow Swiss money manager BSI. The acquisition put EFG into the ranks of one of the largest private banks in Switzerland and increased its assets under management (AUM) to more than CHF 140 billion as of March 31, 2017.

Spearheading efforts to assimilate the new business and restructure operations in The Bahamas is Ian Comins, managing director of EFG Bahamas, who says the process is challenging, but will ultimately result in greater business, better service and more satisfied clients.

“The challenge of any acquisition is taking two organizations, each with their own history and ways of doing things, and ensuring you get the best of each and can deliver long-term growth,” he says. “The impact in The Bahamas is going to be what the two entities anticipated internationally– leveraging certain synergies and increasing our AUMs. As a result of joining the two entities, our clients now have increased access to a variety of banking centres around the world, as well as global investment services and a wider product offering.”

Integration effect
The trickle down effect of the headline-grabbing integration of two well-established Swiss banks is growth according to Comins, who says EFG Bahamas’ priority is to accommodate this additional business, while maintaining high standards of service. “An increased interest in EFG is leading to an increase in business, and we need to be able to manage that growth. We are building the necessary foundation to ensure we are well-positioned for it and have a robust and flexible team that provides opportunities for advancement and growth internationally,” he says. “The key going forward is servicing the business.”

EFG Bahamas currently has two offices, one near Lyford Cay and one in downtown Nassau, but is moving from the latter in the second half of 2017 as it has “outgrown” the space. The new premises will be in the Goodman’s Bay Corporate Centre on West Bay Street.

Currently employing more than 40 members of staff, Comins wants to further develop the bank’s competences and create “a challenging and interesting environment for people to work in.” EFG in The Bahamas offers a range of banking, investment and fiduciary services including portfolio management, trust creation, fund administration, credit services and e-banking. As a result of the BSI acquisition, the bank underwent a rebranding at the beginning of April. “We rebranded the bank and renewed our logo to reflect the corporate values and visual identity of both banks,” says Comins.

Emerging trends
M&A activity has been dominating financial services for a number of years and this appetite for consolidation does not seem to be diminishing. Last year alone, $3.6 trillion-worth of dealmaking was done worldwide and experts predict the trend will continue, driven by increasing regulatory costs, market pressures and a need to re-think the traditional private banking business model.

Comins says the move towards greater consolidation in The Bahamas, and further afield is unsurprising. “Any international organization in the current environment of lower interest rates and tougher competition is looking to ensure they have the most efficient way of offering services to clients. It is a question of economies of scale. The cost of a smaller office can be prohibitive.”

As a gateway to the Americas, and a long-established and well-respected hub, The Bahamas will continue to be an important part of the new entity as EFG and BSI join forces.

Comins says the jurisdiction has always been an important international base for both brands and still has a vital role to play. “The Bahamas is a key centre for us; it always has been. BSI, in its various guises, has had a presence here for 40 years, while EFG is proud to have been here for 10 years. We are looking forward to further strengthening and growing our position in The Bahamas.”

Regulatory change

As the jurisdiction moves to adopt the Organisation for Economic Co-operation and Development’s Common Reporting Standard by the end of 2018, it is drawing the attention of the world’s financial watchdogs. “It is important that the government continues to work with the industry to ensure that the legislative environment is one that puts The Bahamas on a respected footing, but also showcases The Bahamas as an environment in which clients want to invest,” says Comins, who believes that such tax transparency measures will help level the playing field between jurisdictions and result in more emphasis on service and client satisfaction. “The main differentiating factor is going to be the client service,” he adds. “We do have, and will always ensure that we have, the appropriate staff and the means to service our clients.”

As the regulatory backdrop shifts, so too do client needs, according to Comins, who says another emerging trend is the desire for responsive, flexible services. Client relationship officers must be prepared to consistently deliver, even under challenging circumstances. “Clients want to know that we are here for them and able to deal with their requests and instructions. We saw that recently with Hurricane Matthew. We continued to operate and did not have any downtime. While our clients are sympathetic, they still expect us to operate.”

And the clients themselves are changing, a new generation of wealthy entrepreneurs has sprung up–often younger, more technologically savvy and more demanding than traditional customers. “The private-banking landscape is changing and the way banks service clients is changing,” says Comins. “Banking is about people. We have the traditional private-banking environment, with long-established families and old wealth, but we are also now entering the era where you have young entrepreneur billionaires just out of college. They are the new high-net- worth clients and that presents challenges. Not every client is the same. Some want to use technology to bank, so, while we provide the human contact, we also need to ensure we have an industry leading platform.”

Day-to-day banking
Comins joined EFG Bahamas in July 2016, coming from the bank’s Cayman Island branch. He has hit the ground running, dealing with the integration of the assets from the acquisition, getting up to speed on regional initiatives and overseeing the day-to-day running of the bank’s normal operations. His priority for the short-term is to bring about a smooth integration of the BSI operations. Looking ahead to the future, he is preparing to build on that foundation.

“Every day we have new circumstances and new situations. I enjoy the opportunity to interact with the wonderful people in the office and our clients and potential clients. We have a strong management team. One of the nicer aspects of working in the offshore financial centre is that you get a huge amount of exposure to dealing with things at a local and national level. You can very quickly understand and assimilate with the key players and the Bahamian financial centre is agile, professional and well organized,” he says.

“The office has been excellent, and very welcoming. I have really enjoyed my exposure to The Bahamas and the Bahamian people. Bahamians are very proud people. There is a real heart and soul to The Bahamas. That is felt in the vibrancy of the office, as well as when you visit the islands.”

But relaxing on the Family Islands will have to wait for now, explains Comins, who says the joining of two banking giants has left him with little time for a vacation. “The integration is incredibly time- consuming, but I have been very fortunate to visit some of the out islands. I anticipate that I will be enjoying The Bahamas more, and everything it has to offer, once the integration is completed.”

The Bahamas is in a great position to retain and attract investors from the north

The jurisdiction's efforts to implement Common Reporting Standard ensures integrity

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