Banker explains Lombard Odier’s resilience vs Covid-caused meltdowns

By Andrei Skvarsky.

Swiss private banking group Lombard Odier has mainly owed its ability to stay afloat amid market meltdowns caused by the Covid-19 pandemic to not being listed on any stock exchange, to the focused nature of its business and to its level of capitalisation, according to one of its senior managers.

Independence – not selling shares on any bourse, being free from any external pressure and ability to make its own decisions – is one of Lombard Odier’s key remedies for riding out the current crisis, Karen Aslanian, head of Eastern Europe in the firm’s private clients division, explained during an online news briefing.

Another one is the bank’s limited business field. Investing in a diversity of sectors is not what it does. It practically confines itself to asset and wealth management, according to Aslanian.

Capitalisation is Lombard Odier’s third pillar of stability. The bank has a capital adequacy ratio (percentage of risk-weighted assets) of 28 per cent, Aslanian said. The Basel III international regulatory agreement sets the minimum necessary CAR for banks at 8 per cent.

The Geneva-based bank, which looks after assets worth 287bn Swiss francs (304bn), has survived more than 40 crises in its history of over 220 years.

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