The difference this time, he tells The Edge Singapore in an interview, is that this scenario has occurred after an extended period of exceptionally low or negative rates followed by an exceptionally fast-paced rate increase.
The global banking industry has hogged the financial news headlines over the past month more frequently than usual. Right after the run on Silicon Valley Bank (SVB), the industry was further gripped by the “forced marriage” of two of the biggest names in private banking: UBS and Credit Suisse, so that the latter could be rescued and a wider crisis in the industry could be prevented.
For Frédéric Rochat, managing partner of Swiss private bank Lombard Odier since 2012, these changes — while headline-grabbing — is a known pattern that follows cycles of heightened inflation and interest rates, which translate to significant volatility across bonds and equities.
