Vestra Wealth profits from UBS court case
Just over a year since Switzerland's largest wealth manager UBS and boutique start-up Vestra Wealth faced each other in court, the start-up wealth manager is riding the storm, with new client assets growing by over £1bn in the last 12 months.
David Scott, the managing partner of Vestra Wealth, said: “We have managed to attract some of the best people within the industry. Vestra has been particularly successful in attracting a wide range of discerning entrepreneurial clients with strong support from professional intermediaries.”
London-based Vestra's new client base ranges from around £1m to £50m.
Vestra now employs over 125 members of staff – it has almost doubled its numbers since last August, when it had around 75 employees, almost all of whom had defected from UBS last year. Scott would not comment whether he has hired any staff from UBS since.
New starters have joined from larger peers including Kleinwort Benson, Merrill Lynch, Barclays and rivals Close Brothers, Newton, Brewin Dolphin and Panmure Gordon.
Last August UBS won an injunction against Vestra and reached a settlement that reportedly involved Vestra guaranteeing not to hire UBS staff for a certain amount of time. UBS won the injunction on the grounds that Vestra deliberately solicited clients and staff away from UBS, as a result of which four former UBS staff members breached a duty of fidelity.
Scott would not comment on whether the injunction is still active due to the confidentiality clause in the settlement.
Vestra was founded in September 2007 after David Scott left UBS and went live for trading last August. Scott was reportedly the Swiss bank's top private banker in the UK.
He said that the UBS court case had benefited Vestra. He said: "[The case] increased our profile and the financial crisis re-enforced the rationale behind setting up of Vestra".
He added: "Clients were averse to the proliferation of structured products where no-one was told about the credit issues inherent in many of them or the focus on short-term revenue maximisation".
Scott believes that the future of wealth management is to change radically. "I believe the [big] banks will focus on manufacturing and the HNW market will move to independent boutiques who can now compete with similar investment expertise."
– Write to: twilkinson@efinancialnews.com
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