SWITZERLAND- Two of Switzerland’s oldest private banks, Lombard Odier and Darier Hentsch are merging in a bid to cut costs and enable them to compete with larger competitors.

The banks maintain the deal will elevate the combined entity to an optimum size that will enable it to “compete against the ever-growing competition.” In particular, the banks say it will help them develop their European banking activities.

The new bank, Lombard Odier Darier Hentsch, will have assets of CHF140bn (e95bn), 20 subsidiary and branch offices and 2,000 employees.

Both parties are known primarily for their private banking business but have gradually built up their institutional asset management despite it being less profitable.

Of the Chf140bn in assets, half belong to private clients. The remaining Chf70bn constitute institutional and custodied assets although the new group would not specify the size of its institutional business.

The new bank will remain a partnership, headed by Thierry Lombard and Pierre Darier, and supported by a further twelve managing partners.

Pierre Darier, senior partner at Darier Hentsch, said: “we are taking the bull by the horns. Taking this decision shows that we are masters of our destiny in a period when our banks owe nothing to anyone and could continue independently.”