Private bankers run into very public trouble

Matthew Lynn says banks that prospered by offering exclusive ‘wealth management’ services during the boom years are about to encounter some very angry customers

Of all the phrases in the financial lexicon, ‘private banker’ is one of the most evocative. It summons up images of discreet addresses in the more remote Swiss cantons, of luxuriously furnished townhouses in Mayfair, of chequebooks printed in florid script, of pinstriped executives who never stint on the second bottle of claret. Thriller writers find them as handy a plot device as a fully loaded Beretta. Nothing else manages to wrap up tradition, snobbery and timeless financial solidity quite so completely in one institution.

Until now, that is. Over the next few months, the private banking industry looks set to be rocked by a series of scandals. In this country, Sir Keith Mills, the multi-millionaire founder of the Nectar card business, has just launched a high-profile campaign against what was once the grandest of all Britain’s private banks, Coutts & Co.