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Lugano WM CEO: why small players will win the US market

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Lugano WM CEO: why small players will win the US market

The US market presents a lot of opportunities for Swiss wealth managers, according to the CEO of Lugano Financial Advisors (LFA), Francesco Bernasconi. Indeed, offering financial services to US clients seems to be increasingly popular within the Swiss financial market, with both Vontobel and UBS announcing stateside expansion plans.

Talking to Citywire Switzerland, Bernasconi said that he thinks smaller, independent players have an advantage over big private banks and asset managers when it comes to serving US clients.

He said: ‘Smaller firms such as LFA are more client-oriented. We are independent so we do not need to sponsor or sell our own products, and we act in the clients’ best interests.’

Bernasconi said that even though bigger companies have processes in place to deal with administration and compliance, smaller firms can be organised too.

‘We have a risk manager and a compliance officer working in-house, and on top of that we have a law firm which does the auditing to check that we are working according to SEC regulations,’ he said.

The CEO explained that the firm needs to deliver the highest standards, as getting new clients is not easy.

‘We started in 2009. At that time, most Swiss financial institutions refused to deal with US clients, and the ones that still accepted them needed support from a SEC-registered organisation,’ he said.

Being one of the first Swiss players to enter the market after the 2008 crisis was helpful, but there is something else that gives LFA an edge according to the CEO – the language.

‘Often our clients in the US are of European descent, mostly Italians and Germans. We have offices in Lugano and Zurich, and we are fluent in English, Italian, German, French and Spanish.

‘There is a key difference between these clients and the ones that grew up in the US and have spent their whole life there. While the European-American clients are keen on diversifying their assets internationally, the Americans tend to have a home bias and presume that US banks are the best and that the dollar is the best currency. They are yet to discover the advantages of investing a portion of their assets outside of the country,’ he said.

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