00:00Look, you're part of a larger group now. I know you sold Stanhope. Talk to me a little bit about
00:04some of these wealth managers in general. Does size matter? Do you need to be, you know, bigger to reach
00:10more clients?
00:11Size matters. If you look at the landscape of wealth management, it is very polarized between two extremes. On one
00:19side, you have large banks that have substantial resources but are still in a model where you never know if
00:25they advise clients or sell to clients.
00:27And that creates a degree of ambiguity which many high net worth individuals do not accept. At the other extreme,
00:34you have hundreds, if not thousands, of independent wealth managers that do not have the conflicts of the banks but
00:40do not have the resources either.
00:43And what we have done with Coriant is we position ourselves as the best of both worlds, which is having
00:49the scale of a large institutions. We're currently managing close to 600 billion, but having the ethos and the lack
00:55of conflict of interest of independence.
00:57And as such, we are a magnet for firms that are smaller and understand the limitation of not having the
01:04resources to invest globally and across asset classes and join us to pursue their entrepreneurial journey under the Coriant flag.
01:12I mean, do you see any more acquisitions in Europe?
01:15We do.
01:15Again, this is a consolidating space for sure.
01:17We do, actually. We announced the acquisition of Bedrock, which is a firm based in Geneva and London managing about
01:2410 billion. We announced the acquisition of Lettuce Private Office, which is managing about 5 billion out of Paris.
01:31This is done. And we are in the process of looking at potentially more acquisitions.
01:38I mean, it's a funny old market. How would you describe it? There's a lot. You know, I'm looking at
01:41the 10-year Treasury above 5 percent. Are clients asking for-
01:46Yeah, I think there is a great degree of anxiety. And your guest reflected this kind of anxiety.
01:55I feel that it's important to step back. A few weeks ago, the level of anxiety was not where we
02:00are.
02:00It's all triggered by a sudden spike in oil prices. And you have to look at the other side of
02:05the coin, which is the minute oil prices come down, suddenly the stock about interest rates going from 5 percent
02:11on the 10-year to 5.5 to 6 to 6.5.
02:14These stocks will stop and people will become calmer. So what we tell clients is to step back, not overreact.
02:22Obviously, we had already taken the precaution of being fairly short in terms of our bond duration, which protected us.
02:31But the bottom line is that you have a year where earnings growth in the U.S. has been absolutely
02:36spectacular, 25 percent expected for 26, fueled by the profits of tech companies, but not just the profits of tech
02:45companies.
02:46Largely tech companies.
02:47Yes, no, absolutely. And I think that once you look at the positive side of what's going on, AI has
02:53been a tremendous source of productivity increase across the spectrum, not just productivity for tech companies, but productivity across the
03:02board.
03:03Just to give you a sense, over the last three years, productivity has gone up by 10 percent in the
03:08U.S. against 2 percent in Europe.
03:11It just gives you a sense for where things are going.
03:14How does AI actually change your space? You know, wealth managers, does it?
03:19Massive in every aspect of the business. And it's the case in every sector.
03:23In our business, obviously, on the operation side, you can do more with less in terms of investment decisions.
03:32Your analysis is enhanced by AI. We do not want to replace the analysis by AI, but AI informs you
03:40in a way that was not possible before.
03:42So it is a major, major source of change.
03:47I know you've said, let's look at the positives, but do you worry about the concentration in AI?
03:51I mean, we can even leave, you know, there was concerns this week about the end of humanity.
03:55So let's not talk about that.
03:56But just the fact that there's these big IPOs and it feels like the whole equity market is just beholden
04:02to five companies.
04:04Look, I'm not worried because this kind of revolutions, if you look at the economic history, always happen with a
04:10few leaders taking a huge share of the market and then the world spreads to others.
04:16So we are exactly at that stage.
04:19I am not as worried as most on AI and the talk about the end of humanity, et cetera.
04:24I think the genie is out of the bottle.
04:26You cannot put it back.
04:28When you hear that the three leaders of AI companies are saying we're going to slow down, you have to
04:33take into the pinch of salt.
04:34They compete fiercely and the thought that one of them will decide or collectively will decide to slow down is
04:41hardly credible.
04:44I think it's desirable.
04:45They should slow down, but I don't think it's going to happen.
04:47And also the competition of China forces U.S. companies to keep going.
04:52So I don't think I think there is more PR in this whole, you know, wave of interviews being given
04:59by the leaders of these companies.
05:00There is more PR than substance.
05:02I think they will carry on.
05:04I think the regulate, you know, the governments will need to regulate a bit more, but they need to be
05:09very careful because AI is a global business and China is there as a leader.
05:14Daniel, talk to me a little bit about high net worth individuals based in London.
05:18So you deal with them regularly.
05:20I mean, there are question marks about what's in the budget with this new government October 28th.
05:26Do they move?
05:26Do they stay in London?
05:28Like how do you see this moving?
05:29Look, there is concern.
05:31And I think the dispatcher will be a test as to whether this government can reconcile social ambition and fiscal
05:40credibility.
05:41We know about social ambition.
05:43The fiscal element is more complicated because they have said that they will not increase, they will not tax work
05:50more through, you know, rises in income tax.
05:53They have said I don't want to raise VAT.
05:56What's left capital, which basically means wealth tax, higher capital gain tax.
06:05And all of this is a worry because there is a lot of talk about the attractiveness of the UK
06:10and London in particular as a financial center.
06:13Guess what?
06:13You announce a raise in an increase in CGT.
06:17You announce wealth tax.
06:18It destroys credibility, it destroys the attractiveness of the UK.
06:23And that's the last thing you want to do.
06:25This country is indebted.
06:28The amount spent on interest payments is 110 billion pounds every year, which is more than a defense budget.
06:3645 percent of the UK GDP is spent, you know, is public spending.
06:40So what needs to happen is not more tax, it's less spending, and it's a government that has the courage
06:48to tell we should spend less.
06:50Do you think there will be a wealth exodus if this budget is too big?
06:54There has been already, and there will be more.
06:57But, you know, the issue with wealthy clients is not so much the absolute level of tax, it's the visibility.
07:04The minute you break trust and visibility, people go.
07:09They need to know, even if the absolute level of tax is high, if they feel that it's stable and
07:14they have a clear plan as to what might happen in the next few years, they stay.
07:19If they feel that every time, every budget, you have a new announcement, they go.
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