Societe Generale's UK private bank unit is expecting low interest rates to dent its 2010 operating profit, although a rise in assets under management made its chief executive confident about next 2011.
Operating profit is expected to fall to around 20 million pounds ($32 million), down some from a record operating profits of roughly 30 million in 2009, Eric Barnett, head of Societe Generale Private Banking Hambros, told Reuters in an interview.
Barnett said the outlook was due to general global macroeconomic weakness and the impact of low interest rates. "This year has been tough in the sense that wealth creation in this country and the world is obviously at a slower rate than it was pre-crisis levels," Barnett said.
"Private banks do lend but they are dealing with wealthy people who by and large don't need to borrow," he added.
France's SocGen bought Hambros - one of Britain's oldest banks, with its origins dating back to 1839 - for 300 million pounds in 1997 after Hambros had a spell of weak results in the 1990s.
Barnett was more confident about 2011 as the company was winning new assets. He said SGPB Hambros was expected to end 2010 with around 10 billion pounds of assets under management, up around 600 million pounds since the start of the year.
"2011 will be a better platform. We're still looking to grow, we're looking at acquisition opportunities - not that there are many," he said.
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