Depth report

　　

David de Rothschild (David de Rothschild) will step down as chairman of Rothschild (Rothschild) this summer and will be handed over to his son Alexandre de Rothschild, the French and British company This handover of investment banks is long awaited by all parties.

    As the seventh generation of this 200-year-old banker, Alexander has been trained for many years to succeed his father. Currently serving as executive vice chairman, he joined the bank in 2008. Prior to that, he had experience in investment banking and private equity at Bank of America and Bear Stearns.

    The dynasty handover is expected to take place in June. At present, the investment bank is committed to business diversification, reducing its dependence on core French and British consulting businesses, in order to better cope with the period when the European M&A market is not very active.

    Since joining the bank, the 37-year-old Alexander formed and helped lead the private equity business. The group is also increasingly investing in its small-scale business in the United States and completed its first large-scale acquisition last year to expand its private bank. Under the leadership of the old Rothschild, the previously independent French and British banking businesses were merged in 2012 to unify the two branches of the Rothschild family and consolidate the balance sheet. Prior to this, David had been in charge of the Rothschild Bank in the UK after his cousin Evelyn de Rothschild retired in 2004.

    The Rothschild "dynasty" no longer holds the power it had in the 19th century. But since 2012 (the year Rothschild merged its French and British holding companies into the same group), Rothschild stock has performed almost as well as US rivals Moelis and Evercore in boutique investment banks. Maintaining this momentum will be the responsibility of Alexandre de Rothschild. Later this year, he will take over the chairmanship of Rothschild & Co from his father David (David, second from left), which will be the most widely reported in the banking industry. Take over once.

    Three-fifths of Rothschild's profits come from the global consulting business, Macron once engaged in this business in Rothschild. In terms of the number of transactions in which Rothschild provides consulting services, it is already the sixth largest consulting firm, but its US business is obviously weak. To expand in the United States means that Rothschild has to compete with large investment banks and boutique investment banks on their home courts-this is a challenge for Rothschild who tends to hire individuals instead of poaching the entire team. .

    Rothschild also hopes to reduce reliance on a lucrative but cyclical consulting business. The group has two other businesses. Commercial banking is growing, but its scale is still small, with revenues only a little more than one-tenth of its consulting business revenues. The wealth and asset management business may be profitable; the group’s goal is to increase the operating margin of the business from less than 7% to 20% by 2020. But in this area, Rothschild's size is also very small, with only 67 billion euros in assets under management. The French-German joint Oddo BHF and the mid-sized Swiss private banks each have more than 100 billion euros in assets under management.