There has been speculation for some time, but now it's confirmed: Flossbach von Storch (FvS) will withdraw the custody of its private banking funds from DZ Privatbank in the fourth quarter. The Cologne-based asset manager confirmed this after an inquiry from Börsen-Zeitung. „Finanz-Szene“ had reported at the end of last year that the cooperative bank could lose Flossbach as a client.

Now, there is certainty. Flossbach has expressed gratitude to DZ Privatbank, acknowledging their support and guidance for over a decade as a young company. Therefore, the decision to end the relationship was not an easy one, said Kurt von Storch.

Von Storch emphasised that the decision to switch was not due to any shortcomings in DZ's service quality. The bank provided excellent service. „In the coming years, we want to further advance the internationalisation of our business," he said. "Therefore, we have been looking for a partner who is even more internationally connected and rooted.“

Currently, approximately 20% of Flossbach von Storch's managed assets in private banking and wealth management funds come from abroad, from investors in Spain, Italy, Belgium, Luxembourg, Portugal, Liechtenstein, Austria, France, and Switzerland. The origin of funds is becoming increasingly international, reflecting the current state of fund usage.

As for which provider Flossbach von Storch will transfer its business to in the fourth quarter, the asset manager declined to comment. Given the international nature of the requirements, it's likely to be one of the major banks in this sector. BNP Paribas and HSBC are often mentioned in financial circles.

The transfer affects the business with private client funds, where Flossbach von Storch manages around 50 billion euros. Overall, the asset manager manages around 70 billion euros in assets. Institutional funds are already distributed by a variety of banks.

For DZ Privatbank – which serves as the competence center for private banking, fund services, and loans in all currencies within the Cooperative Financial Group – Flossbach von Storch, with its approximately 50 billion euros, was a significant client. As the bank said upon inquiry, its assets under custody amounted to 188 billion euros at the end of last year. In fact assets under custody had grown to over 200 billion euros by the end of April. While the bank said that it always regrets the loss of clients, it expressed pride in having accompanied Flossbach von Storch for over 16 years. Nonetheless, the bank also clarified that the departure of the Cologne-based asset manager would not have a significant impact on its own earnings situation

According to its annual report, DZ Privatbank commission income last year amounted to 219.7 million euros, primarily driven by contributions from private banking and fund services. However, margins in asset custody are significantly lower than in asset management. Managed assets were reported at 23.4 billion euros, substantially lower than the reported 188 billion euros in custody assets.