Mirabaud builds cautious digital update to traditional business

As the seventh-generation steward of a 200-year-old private bank, Lionel Aeschlimann, senior managing partner of Geneva-based Mirabaud, is surprisingly bullish on the future.

Where others see challenges, he sees opportunity in the sweeping technological overhaul of private banking, in the growing complexity of client needs and in the surging interest in portfolios focusing on private markets.

When asked where client capital is flowing, Mr Aeschlimann does not hesitate for one second: “Private markets.” The trend is unmistakable, and, in his view, sensible.

“About 70–80 per cent of the world economy is unlisted. We’re an unlisted firm ourselves. It’s a mistake not to include private assets in long-term allocations.”

The firm has been here before, and he urges clients to proceed with caution. Mirabaud staff well remember the hedge fund scandals and over-selling of 2008, when wealthy Swiss investors were left stunned at their losses. In the wake of the Madoff scandal, Mirabaud was one of the first Swiss banks to recommend blacklisting alternative investment vehicles which did not use external administrators.

This safety-first philosophy is key to Mr Aeschlimann’s way of doing business, warning that private markets are not for everyone. Illiquidity, complexity and duration risk make them a poor fit for investors expecting fast returns or daily liquidity.

“We avoid mismatches,” he says. No matter how fashionable the strategy, you cannot offer liquidity on an illiquid asset, that’s how people get hurt, he believes. His approach to hedge funds, which Mirabaud first introduced to clients in the 1970s, is similarly conservative.

“If you’re patient, you’ll look back in five to seven years and realise you’ve outperformed, with half the volatility,” he says.

Mirabaud “is a boutique firm that strongly focuses on its traditional values such as independence and responsibility”, says Sandra Daub, board member at Noumena Digital and guest lecturer at the University of Lucerne in Switzerland. In recent years, she notes, the firm has doubled down on its two core businesses, wealth management and institutional asset management, and exited its brokerage arm to stay focused.

That streamlining is reflected in a more focused investment offering, particularly for ultra-high net worth clients. Ms Daub points out that Mirabaud offers “dedicated mandates that combine liquid asset classes with private investments”, a hybrid structure she suggests can make a real difference in client portfolios.

Swiss commentators note that their numbers are not particularly impressive compared to rivals like Lombard Odier, Pictet and Julius Baer. Indeed, Mirabaud’s 2024 asset growth has lagged. While its approach may appeal to more cautious investors, it faces growing pressure to keep pace with industry peers.

In 2024, Mirabaud also faced compliance scrutiny. A FINMA report published in September identified weaknesses in the bank’s internal controls. According to Swiss analysts, regulatory obligations weigh more heavily on smaller institutions. The fixed cost of compliance infrastructure, from anti-money laundering systems to cross-border controls, creates a structural disadvantage for smaller firms.

Less not more

In a world dominated by multinational banking giants, Mirabaud claims it can compete with the Goliaths by doing less, not more. “The list of what we don’t do is longer than the list of what we do,” Mr Aeschlimann says, smiling. “We only manage money. That’s it.”

This simplicity is deliberate. With the group’s own capital invested alongside that of clients, alignment must be absolute. And without complex balance sheet risks, the kind that felled Credit Suisse, SVB and others, Mirabaud says it emphasises resilience over revenue maximisation.

“We probably make less money than some other banks,” he suggests. “But we’re still here after 200 years. That counts for something.”

It is now his view that this more conservative approach is making some headway among potential clients, weary of high-octane strategies that have long been pumped by smooth-talking sales forces. This shift in client expectations is colliding with digital transformation, reshaping an industry deeply shaken by human concerns, he says.

Speaking from the Centre Pompidou in Paris, where the Mirabaud private banking group has been a key partner, Mr Aeschlimann reflects on these profound changes.

“I believe clients are increasingly moving away from product-driven wealth managers to holistic advisory-driven managers,” he says. “People who can understand better their needs, their goals, their constraints, their visions, their biases, their family stories,” he adds.

Intimate model

While this revolution plays on Mirabaud’s strengths as a family-owned institution, championing a more intimate model of private banking, he is also acutely aware of the digital investment needed in AI tools and robo-advice to update his traditional set-up, prizing stability and discretion over short-term gain.

“Fortunately enough, three years ago we started the biggest digital transformation project in the 200 years of Mirabaud,” Mr Aeschlimann explains. “We are now finalising it. It’s one of my priorities as chairman of the group, as the new senior partner, to finalise and cross the line this year on this project.”

This overhaul, modular, cloud-based and designed to be “non-monolithic”, reflects Mr Aeschlimann’s conviction that technology must serve human relationships, not replace them.

“Clients are not interested in technology. They’re interested in the quality of the relationship and quality of performance, but technology allows this quality,” he adds. He draws an analogy, comparing technology to the hidden mass of an iceberg that keeps it afloat.

Mirabaud’s “long-term view” also shapes its approach to succession planning and intergenerational wealth transfer. With vast sums expected to pass from baby boomers to their heirs over the coming decades, private banks are racing to understand the next generation of wealth holders.

Highly personal

Mirabaud’s answer is highly personal and very Swiss. Each summer, it runs the Mirabaud Academy, bringing together 20 to 30 next-gen clients for several weeks of “deep engagement” with the bank’s team and philosophy.

“These families are complex, blended families, cross-border lives, divorces, new businesses,” Mr Aeschlimann says. “So the solutions must be personal. But we can relate. We’re a family-owned group ourselves, grappling with the same questions of succession.”

That alignment between client concerns and the bank’s own experience is one of Mirabaud’s quiet differentiators, bearing in mind the bank has been forced to wrestle with generational transition internally, just as its clients do externally.

As the private wealth industry digitises, diversifies and decentralises, Mr Aeschlimann is staking Mirabaud’s future on a hybrid model: old-world discretion with new-world tools. But the bedrock, he insists, remains the same, a trusted relationship. Advisers to younger generations must be able to “relieve the burden”, he explains. “Wealth is a responsibility. You want to be served and served well.”

In a business increasingly defined by noise, scale and speed, Mr Aeschlimann claims to offer something quieter and perhaps more lasting. “Service is noble,” he says, with conviction. “And the quality of service is obvious when you see it.”