Laurent Ramsey in

“It didn’t even take three seconds”

“We never discuss how to make more profit”, Pictet partner Laurent Ramsey tells in an interview, adding that of his six co-partners, “nobody thinks that any one of us is extraordinary but as a whole, we are relatively strong.”

Laurent Ramsey has been Managing Partner of the Pictet Group since 2016

Laurent Ramsey, isn’t it a burden to be a partner of such a large financial institution?

I wouldn't call it a burden but more of large responsibility. The good thing about it is that we are never under time pressure. We do not need immediate success or have to show short-term results. We can take the time to build a broader, more robust, form of success. Short-term pressure can be a burden but we don't have this at Pictet.

You once said that it is not your objective to launch new financial products every year. Are you not in danger of standing still?

You have to know that growth per se is not our target. We do not run after every passing fad. What we do is far more focused on building something that from our point of view makes sense for clients. It is really the investment case that counts and if it does not convince us, we let it go.

But you are in danger of losing your ability to innovate?

Of course, you can constantly launch new products. But that is not our thing. We are in the business of preserving and growing savings in the long term. That is why we are extremely cautious.

We calculated that it takes on average between four and five years for a new investment strategy to be successful and reach a size of at least one billion francs ($1.1 billion). When you calculate the time you also need to find the right experts, it can take up to six years.

So you cannot launch a product by looking at what worked recently, you need to anticipate, you need to look forward and you need to be patient for success to come through.

You can only do that when you are not thinking of short-term success.

Do you have an example?

In 2014 we launched a China bond fund. Up to about two years ago, we had between $55 million and $110 million in it. It was only last year that it changed, almost instantly. Now we have $2.2 billion in the fund. It took more than six years. You can only do that when you are not thinking of short-term success.

What role does Asset Management have at Pictet?

The wealth management business manages about $290 billion and we in asset management have about $270 billion. Today the profit contribution of the Asset management has surpassed the one of our wealth management. Wealth management is less cyclical but asset management is more scalable.

You have to explain that a bit better.

In asset management, if you have a successful investment product you can grow from 200 million to $5 billion without increasing your costs substantially. On the other side, in wealth management, if you want to grow you need to add bankers in order to keep the same level of service.

Doesn't your success depend on Pictet's private bankers in that they selling your products to clients?

Not at all. We do about 10 percent of our business through the wealth business of Pictet. In other words: 90 percent of our business comes from the outside, from «Third-party clients».

These numbers also answer the question as to whether client advisors in wealth management have any conflicts of interest in selling Pictet products. The answer is clear – they don't.

Asset management is consolidating radically. Many companies are disappearing or being taken over by larger companies. What do you need to do to survive in this environment?

I think that focus is important – or what you pay close attention to. You can say it differently. It depends on how you define success. Is it about numbers alone or whether clients are satisfied? We are not about being the largest asset manager, we are about being the finest. We do not have to please external shareholders and we do not have a share price we have to keep high.

What we do is take the time to make sure an investment strategy leads to client success. All the mergers and takeovers that we are seeing the only aim at satisfying shareholders. That is really not always in the interest of clients, which is what we focus on.

That all sounds very convincing. But doesn't an asset manager need to have the critical mass to survive?

Mergers and takeovers are mostly bad for business. You run the danger of losing your best people and clients. In an acquisition, you take over the people of another business culture that you then have to integrate.

That is why we prefer to hire talented employees and not take over the entire structure. It is also a fact that clients follow good investment experts.

But you don't feel forced to make a quantum jump now?

If you look at the largest asset managers and you see which ones are losing assets to competitors, it is always those that have been through M&A. You lose your focus on asset management and instead lose yourself in cost-cutting, integration, and rebranding. Our strategy of independence has given us a great deal more success.

Credit Suisse's Asset Management arm has had enormous problems recently. What do you think the reasons for that are?

I can’t comment on that. I think, however, that the perception that it creates for domestic asset management, and probably also Swiss finance as a whole is not positive. We need a strong domestic competitive landscape as a financial center.

How do you discuss business with the other partners?

We are seven partners and we meet three times a week. We have a close relationship and we are very transparent with each other. Nobody thinks that anyone is extraordinary but as a whole, we are relatively strong.

We also know that we are going to be together for another 20 years. That is the average tenure of a partner at Pictet. We all must take responsibility tomorrow for any decisions we make today. Our reputation is our most valuable asset. That is why we assess risks differently than other institutions do. But that does not mean we cannot do very innovative things from an investment perspective even though we are quite conservative.

Working from home cuts creativity.

What do you do when things don't go as planned?

I will give you an example. In 1997 we launched a telecommunications fund because we thought it was the next big thing. But it turned out, quicker than we expected, to be a sector that was not going to have the necessary growth rates. We redirected the focus of the fund towards a digital strategy. It can happen that you don't have the right focus at first. 

Many asset managers are focusing on sustainability, or ESG, criteria. Is that hype like the telecommunications industry was?

I don't think so. We started a sustainability fund in the mid-1990s and we have more than 25 years of experience. Everyone is talking about sustainability and impact investing today. But at the end of the day, it is about identifying factors that have a perceptible impact on the value of a share. Nothing more. I can't imagine that you would ignore the issue of sustainability as part of the investment process.

Was it harder to be innovative in the last 18 months because of the restrictions from the pandemic?

Basically yes. Working from home cuts creativity. It disrupts any kind of exchange that is not targeted but can lead to new things in and of itself. This kind of exchange got lost when you were just communicating through zoom meetings. I think that it was a problem for creativity. But 18 months is a relatively short period of time for a company like Pictet, which is focused on the long-term. 

You have been working at Pictet since you graduated. What got you into banking in the first place?

I was good at mathematics in school, which was certainly helpful. The financial markets fascinated me from an early age.

When I started at Pictet there were no programs for graduates. I started as a junior analyst for European shares. After that, I changed to portfolio management, where I worked in Asia, first in Hong Kong and then Singapore.

Swiss banks are stigmatized in the Anglo-Saxon media.

You also worked in London for a time. What are the biggest differences between the British and Swiss financial centers?

Well, London before Brexit was the most important financial center in the world for me. The dynamism, the diversity of people was always very impressive. All the most important participants were in London. 

London has a very decided picture of Switzerland. What do you think of when English media report about Swiss banks?

I don't really think of anything. Swiss banks are stigmatized in the Anglo-Saxon media. Why is that? Much of that has to do with the old perceptions of banking secrecy but it is also due to the fact that the Swiss banking sector has been able to reinvent itself and attract talent.

The strength of the Swiss franc has helped. All finance centers have challenges but some are simply not reported on as much here given Swiss banks are not involved.

What are your perspectives if you remain a partner at Pictet for another 15 years? Or, in other words, why did you come up for consideration as a partner to begin with?

You have to ask others, not me (laughs). Fundamentally factors such as experience and expertise count, and how one fits in the culture. Age also plays a role. Otherwise, there could be vacancies in the partnership committee. All in all, I was probably in the right place at the right time.

How long did it take you to accept the job?

I don't think anyone has ever refused an offer to become a partner in the entire history of Pictet. I had already been working here for a while when I accepted. It didn't even take three seconds for me to decide.

You know, for me it is something special that we as partners never discuss how to make more profit. That gives us a certain calmness that is incomparable. Instead, we talk about investment strategies that are useful for clients and can help profits if things turn out well.

Do you have any interests outside the bank?

My hobbies? My three children come first - 15, 13 and 4. I like scuba diving but I haven't had much time for it recently. The same goes for other sports in general.

Written by Claude Baumann, Editor-in-Chief,, 16 June 2021
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