Bank Syz Ltd — Annual Report 2020 “Preserve and grow your wealth for the future with a private bank that understands what matters to you. Invest for the long-term, for your family with ours.” We’re here to help you to protect, grow, enjoy, transmit, and give purpose to your wealth. We founded Syz to offer an alternative to the traditions of Swiss Private Banking. Instead of secrecy and product pushing we’re focused on asking the right questions, listening to what you tell us, delivering good performance, and providing great service. Put your wealth to work for the days, decades and generations ahead with Syz, for the future… Delivering Performance Through 2020 2020 delivered the greatest economic and social shock of our low and inflationary pressures, at least in 2021, are more about working lives. Despite the challenges to our health at a personal catching-up with the ongoing recovery. and global level, still, the support of governments and central banks This is providing tactical opportunities to capitalise on higher growth meant that our economies and even markets have weathered the and inflation in the first part of 2021. The recovery is temporarily challenges of a year none of us are likely to forget. challenging duration risk and structural growth equity positions as The economic shocks had a volatile impact on valuations, testing our markets turn to cyclical sectors. investment philosophy. We were gratified to see that this investment Gold played a role in contributing to cushioning some of the model, first put in place in 1996, proved robust and allowed us to market’s downturns in March 2020, and just like other assets, we report resilient returns to our clients. For the portfolios that we had to manage our allocation tactically along with long-duration US manage on behalf of clients, these returns were often significantly treasuries throughout the year. From a geographic point of view, ahead of our peers. we actively increased our investments in China to create a direct Once again, the pandemic proved that investing through a crisis exposure to the country, which became one of the best performing demands a combination of skill, experience, and cool heads. In regions. phases of extreme market volatility, that can mean taking difficult From an investment perspective then, in 2021 we need to maintain decisions. We were able to mitigate the risks that otherwise an active approach to seizing possibly short-lived opportunities, undermine portfolio performance. without taking an eye from the broader environment. One of our roles as wealth managers, is to help clients to achieve In 2020, video streaming technologies allowed us to remain in close their long-term goals through sound decisions. As the pandemic contact with our clients, including through online events to offer struck, we had to react fast. By applying the data gathered from expertise and address concerns. Communication technologies gave market indicators, we were able to cut exposures early, and us the chance to interact more frequently with clients, reacting more significantly, reinvest quickly, as early as the end of March 2020. The quickly than if we had merely relied only business trips and in person year also showed that sometimes, it pays to pay for a little portfolio meetings. The process of on-boarding clients in 2020 of course protection, specifically in the form of put options; last year the gains became more dependent on technology and these processes will far outweighed the costs. keep evolving in sophistication as we work through the pandemic. By the time we reached the second half of 2020 and new lockdowns, Last year, we continued to adapt our global footprint so that our a combination of fiscal stimulus and changed work patterns created locations better suit our clients’ changing needs. Specifically, opportunities in everything related to work-from-home and locked- we closed our Miami office, completed a management buy-out in down living. Then, toward the end of the year we took advantage of the Bahamas and opened a representative office in Istanbul. Our the equity market rallies to reinvest in value sectors, as we saw the footprint will continue to evolve over the coming years as we look first signs of inflation in many years. to strengthen our presence in our existing offices in Switzerland and While we see rising yields and interest rate expectations on the seek ways to better serve clients in Latin America and in Africa. back of recovering economies in 2021, longer-term, we believe We have also developed a Syz “ex-custody” offering, which that we are still in a deflationary environment. We have labelled this allows clients to leave their assets deposited with other banks, ‘Japanification.’ The underlying levels of economic growth remain Annual Report 2020 Bank Syz Ltd 5 DELIVERING PERFORMANCE THROUGH 2020 while benefiting from our discretionary portfolio management or Leveraging Group Expertise advisory and trading services. This offer streamlines the onboarding The Group remains convinced that performance in a ‘Japanified’ process and provides consolidated reporting for clients’ portfolios, world requires access to alternative wealth management simplifying their experience of working with several advisors. instruments. These tools can offer uncorrelated returns. This is why Furthermore we extended our wealth planning offering by launching since 2018 we have developed Syz Capital, a business that provides a Family & Investment Office (FIO). Our wealth planning capability is qualified clients the chance to invest alongside the Syz family and structured to work with clients worldwide through a select group of access alternative sources of return including direct private equity, partners with specific expertise in areas such as pension planning, special situations, uncorrelated strategies and hedge funds. Many wealth transfer, mobility, and philanthropy planning. In 2020, the of these investments are traditionally hard to access for private launch of our FIO brings an integrated, cross-functional and multi- clients but through Syz Capital, we are able to offer our clients the disciplinary approach to wealth planning, whereby the team can opportunity to invest in some opportunities which they would have call on all the bank’s areas of activities to find solutions that best traditionally been excluded from accessing. serve clients’ present and future projects. For example, in addition to The team has managed to provide investors high single-digit to traditional discretionary and active advisory services, it offers clients double-digit returns through the year and is working hard to add direct access to its trading room, specific forex mandates, tailored focused investment strategies and thematic opportunities. alternative and private equity investments, along with exclusive partnerships for capital raising, merger & acquisition and strategic As banks began in recent years to pass on the costs of holding advisory. As a result, the FIO provides a tailored approached built cash, including for smaller sums, our money market clients have around clients’ personal, family, business and wealth objectives. increasingly sought our expertise to mitigate short-duration costs in Swiss francs, euros and US dollars. Syz Asset Management is For our independent manager clients, the team continued to invited to tender on most institutional fixed income mandates in focus on offering a full range of custody and investment services. Switzerland as one of the key players in this space. We also continue We developed new relationships with independent managers in to see demand for our Swiss-domiciled Green Bond offering, the Switzerland. Additionally, we helped some of the independent first of its kind, which offers clients the opportunity to proactively managers we work with to build their managed portfolios by giving support a sustainable, carbon-neutral economy. Our approach them direct access to our investment experts and our trading earned Syz Asset Management a position among the top ten ESG platform, as well as extending their loan book strategy. As the asset managers in Switzerland by the Hirschel & Kramer Responsible regulatory landscape for our clients evolves, and the demands on Investment Brand Index (RIBI TM) 2020. their businesses have increased in recent years, it has become more difficult for some managers to operate viably. While we have been We also continued to reinforce our advisory platform while deepening often able to help them to find solutions for their businesses, we our investment talent pool. Finally, we look forward to welcoming a also believe that the environment is stabilizing, as regulators have new Head of Advisory in 2021. Despite the challenges of 2020, we recognized the value of offering investors choice from a broad range are proud that the hard work and professionalism of all our staff and of banks, wealth managers and independent advisors. are pleased to report a net profit of CHF 4.2 million for the private bank. 6 Bank Syz Ltd DELIVERING PERFORMANCE THROUGH 2020 The private bank maintains ambitious targets to attract new clients We believe that the structural decisions taken in recent years for in the next few years, both through organic growth as well as the business, while sometimes difficult, position us well to offer our appropriate acquisitions of like-minded wealth managers. clients excellent opportunities through our work together, for the future…. Philippe Reiser Yvan Gaillard Chairman, Board of Directors CEO, Bank Syz Ltd Annual Report 2020 Bank Syz Ltd 7 FROM THE SYZ COLLECTION: /David Hominal, Untitled, 2015_Oil on canvas, 220 x 180 cm David Hominal (1976 in Evian, lives and works in Berlin) Since graduating from the Lausanne University of Art and Design (ECAL) in 2000, David Hominal has expressed himself primarily through painting, as well as via screen printing, photography, video and even performance. Despite this multiplicity of mediums, painting remains central to his artistic approach. In his work, David Hominal examines the issues and place of painting today, while at the same time considering the legacy of modern and abstract art.