Banque Pasche, the Geneva-based private bank, is about to be sold to Luxembourg. Crédit Mutuel, the French owner of Pasche, is about to conclude the divestiture it began two years ago, research by finews.ch showed.

The sale of Pasche, or what was left of it after parts had been sold over the past two years, was widely expected, because the bank was said to be heavily exposed to untaxed offshore capital, damaging the reputation of its owner Crédit Mutuel. Pasche today is reduced to its headquarters in Geneva and a branch in Zurich.

The buyer of Pasche will be Banque Havilland of Luxembourg, the research by finews.ch showed. Little surprise there: Havilland in 2013 bought the Monaco unit of Pasche, adding the majority of Banque Pasche Liechtenstein and Banque Pasche Bahamas to its portfolio last year.

Banque Pasche didn't want to comment the report by finews.ch and Banque Havilland said it couldn't comment at this point.

Zenith in 2007

Banque Pasche, founded in Geneva in 1885, at its heydays had offices in Geneva, Zurich, Nassau and Monaco, as well as branches in Lucerne and Dubai. Family offices in Marrakesh, Rio, Montevideo and Shanghai were also part of its network. It reached its zenith in 2007 following several acquisitions, amongst others of Swissfirst Bank. It had assets under management amounting to 7 billion francs.

Martin Sztremer was recently installed as chief executive, taking the reigns from Jean-Pierre Merlo.

Problems in the U.S. and France

Pasche may have relied too much on its business with untaxed assets, judging from the problems with the judiciary in the U.S. and France. It was forced to pay 7.2 million dollars to the U.S. authorities in July to avoid prosecution as finews.ch reported. The institute had been put into the category two of the U.S. tax program.

Banque Pasche was however also under pressure from neigboring France. Together with UBS, HSBC and Reyl it was on a list of companies suspected to have laundered money and for tax fraud. The French authorities accused Pasche and its owner Crédit Mutuel-CIC to have operated an organised tax fraud system from its office in Geneva.

France 3 to Air Program on Tax Fraud

Similar accusations had been levelled at the Monaco branch in 2013. Jürg Schmid, the former head of the Monaco branch was investigated following allegations by employees who had been released by the bank. Pasche denied the allegations.

French TV channel France 3 will air an investigative program about the alleged tax fraud system of Pasche and Crédit Mutuel on October 7. Originally, the program had been due to be aired by Canal + in May, but Vincent Bolloré, the head of Vivendi, who owns the TV channel, had personally stopped the program from being shown, according to French media reports.

Rowland's Private Banking Group

Havilland doesn't seem overly concerned by the allegations. It was founded with the remains of Iceland's Kaupthing in 2009 and is under control of the Britisch family Rowland. Rowland aims to build an international private banking group. It bought Banco Popolare in Luxembourg in August.

Havilland hasn't yet said how many assets it has under management. It made a profit of 2.8 million euro last year and employs about 90 people.

The sale of Pasche is just one of a string of transactions on the Swiss financial market. Most recently, Vontobel bought Finter Bank, as finews.ch reported.