An active player in wealth management consolidation

mai 2016

A decisive step towards a new future

Forum Finance Group: the company is awarded the LPCC licence and declares itself open to new managers.

A paralyzing regulatory environment and exorbitant costs – is it the end for independent wealth management? You could be forgiven for thinking so if it wasn’t for the fact that some firms have taken the bull by the horns and made the first leap forward. Following the awarding of with the awarding of the licence de gestionnaire de placement collectif The Forum Finance Group has signalled clearly that it is prepared to face the new order by positioning itself amongst the half-dozen Geneva-based firms ready for the future. I interviewed two of the five partners, Etienne Gounod and Egon Vorfeld.

The number of wealth managers with the LPCC license is fairly small. How and why did you obtain it?
FINMA notified us in mid-February that it was necessary to procure their authorization to operate as a fund manager. It happens to be the culmination of a process that we have ourselves been undergoing since 2002, to distinguish ourselves from the traditional model of individual managers and to position ourselves as a true partnership that assures both the firm’s durability and growth.

Do you genuinely need this licence?
Yes and no. Our funds are almost at the size beyond which it is necessary for us to hold this FINMA authorization, but more importantly, we realized that, regarding credibility with banks and clients as well as the development of our existing structure, it was time to take this step. To position ourselves at the heart of the FINMA regulatory environment is a true advantage for foreign clients. It is a guarantee that we can
allocate necessary resources such as time, equipment and personnel for a truly professional management of assets. Furthermore, it guarantees that our corporate governance conforms to international standards with an independent and technically competent board of directors. The rigour of the FINMA process endorses our existing procedures. It is spelling out in black and white what we were already doing at the firm.

Tell us a little about the firm’s history.
Forum Finance was founded in 1994 by Denys Chamay and Hervé Chanut. Etienne Gounod joined the firm in 2002, followed in 2009, after the departure of Denys Chamay, by Egon Vorfeld who previously ran his own firm, IWM (Independent Wealth Management). Subsequently in 2011, Hippolyte de Weck joined the company from UBS where he had spent 17 years, and recently, in 2013, Philippe Kern moved over from the bank Pictet after having worked there for 30 years. Unlike what was so often the case, Forum Finance was never about being a group of individuals working for themselves and sharing all or part of the costs. Instead, it was about a cohesive team in which each person plays a distinct role and works for the group. Egon Vorfeld is responsible for investments, Hippolyte de Weck runs the operational side, Philippe Kern has the marketing brief, notably for the international market, and Etienne Gounod is responsible for overall strategy. The idea was to unite the requirements of a private bank inside a small structure in order to assure its sustainability. Today we have almost 20 employees and more than 1 billion CHF under management on behalf of a roster of wealthy clients and family offices.

What are the key steps?
Since 2002, assuring the long-term continuity of the business by welcoming new partners into the firm; a strategy of all clients being fully compliant since 2011, cost transparency and finally, the abolition of retrocessions also since 2011.

Does this also mean that you reinvest your profits in the business, unlike the traditional business model where profits are distributed annually amongst the partners?
Yes, precisely. Our objective is to invest in infrastructure, in office equipment and in talent in order to diversify and grow our business. Furthermore, we divide the profits regardless of the revenues generated directly by each partner because we want to focus on the overall contribution of each person, independent of individual profit.

Until now you have remained remarkably discreet. Why are you now talking about the firm’s development?
For more than 20 years the motto of our profession was ‘to live well, you must live out of sight’ .That’s history. Progress today requires a certain visibility towards not only our partners, but also our clients. We have reviewed our corporate identity and we will soon be launching a new website. Our new image will be more consistent with our ambition to grow.

There is much discussion about the consolidation of independent managers. However, it’s a slow process.
The depositary banks are bending over backwards to support independent managers but not at any price. The first condition is not to compromise yourself with high-risk clients. Managers who have not adopted the necessary KYC model are no longer acceptable. The second is that the managers must reach a critical size smaller than which it is not worth giving them competitive terms. No bank is ready to risk its reputation by taking on a small two-man operation looking after one client in an at-risk country. We always thought that the consolidation process would be slow, but in fact it has accelerated due to the pressure from banks who have become proactive in converging the managers that they serve. There are few independent managers in Geneva who are able to work with the new requirements of the profession. More importantly, only a half-dozen are capable of it, as they must adhere to the rules of capital which take account of operational expenses as well as the amount under management.

What are your future plans?
These include a growth of funds with high-quality management approach, a possible doubling in asset size over the 5 coming years. Also the expansion of the office space and an increase in the number of employees to 25. Lastly, the addition of new managers whose style is compatible with the ethos of our partnership. We are almost more committed to the firm’s spirit than to the growth of our funds.
Will Geneva remain a key place for wealth management?
Swiss expertise of investing internationally is almost unique in the world. It is high time we exploited this.


Among the Top 10% of independent managers in Switzerland


The recent granting of the LPCC licence by FINMA to The Forum Finance Group has consolidated the firm’s business and further strengthened its wealth management activity. This latest step lays the foundations at Forum Finance for the company’s plans for future expansion as the industry leader in the area of independent wealth management in Switzerland at a time of an intense period of consolidation in this sector.

Established in Geneva in 1994, the independent wealth management firm, The Forum Finance Group, offers its global asset management services to an international client base of wealthy individuals and family offices. Managed by five partners (Hervé Chanut, Etienne Gounod, Egon Vorfeld, Hippolyte de Weck and Philippe Kern), Forum Finance comprises 17 employees and manages more than CHF 1 billion, positioning it among the top 10% of independent wealth managers in Switzerland.

At a time when independent wealth management is under the spotlight, Forum Finance is clearly signalling its ambitions and positioning itself as one of the role models in the sector. Indeed, its size allows the firm to apportion sufficient resources to ensure its continued development and gives it true credibility with regard to managers looking for a strong, entrepreneurially-minded business at the very moment when regulatory pressure and a squeeze on margins is forcing smaller business to make widespread adjustments.

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