«In good times and in bad»: the pledge made by couples marrying in a church equally applies to carriers of noble names. Financial institutes with a 'Hottinger' in their name know as much since the demise of Bank Hottinger in October.
The Swiss banking regulator Finma at the end of October opened bankruptcy proceedings against Bank Hottinger, a small Zurich-based institute with a history of more than 200 years. With the risk of the bank becoming overly indebted as a consequence of the costs incurred through the bankruptcy proceedings, Finma decided to order the liquidation of the institute.
The exemplary collapse led to some noticeable collateral damage in the company and family dynasty of the Hottinger family.
JCE Hottinger, a wealth manager in Zurich, had to act swiftly to make sure its customers and partners knew it wasn't implicated by the collapse of Bank Hottinger. More drastic however was the case of Hottinger & Co., a wealth manager in Basel.
Migros Bank Pulls the Plug
Bank Hottinger owns 51 percent of the company in Basel, but unlike the bank, the institute residing at a noble address on Basel's Hardstrasse has ample liquidity as sources familiar with the company told finews.ch.
It didn't help. Migros Bank, the commercial banking partner of Hottinger & Co. for the past ten years, pulled the plug. The compliance department in a preemptive strike froze all accounts of the wealth manager, without informing its client as an insider, who requested to remain unidentified, told finews.ch.
An intervention by Hottinger & Co. was to no avail and the accounts remained frozen for two weeks. The accounts were only deblocked, when the liquidators of Bank Hottinger, Wenger Plattner, approached Migros Bank.
Two weeks without access to your money will break most small wealth managers. Hottinger & Cie. seemed to have access to other liquidity to bridge the drought. The company now has access to its money again, but not at Migros Bank, which cancelled all accounts and deposits.
Migros Bank and Hottinger & Cie. refused to comment.
