Private baking is a branch of banking that deals with the financial services as well as investment subjected by banks for individuals’ investing. In the mass-market, private refers to be more personnel form of banking that adds to the customer service. As a matter of fact, it is regarded as dedicated service rendered by the bank advisors. Private banking is considered as an incorporated banking institution.
During earlier times, this form of banking used to be very much exclusive comprising of only high amount transactions for the individuals, usually exceeding $2 million. But now, it has been reduced to $250,000 for individual bank accounts, to attract the private investors. The private institution can provide the investors with various offers and planning such as wealth management, inheritance, savings and tax planning. Wealth management is considered as the highest profile form of private banking. The word private in this context often refers to bank secrecy that minimizes the taxes with care, by hiding the assets from the tax authorities. Many offshore banks with Swiss banks help the customers in hiding their income levels, thereby saving the amount spent in form of taxes. Fraudulent activities, be it with anyone, are regarded to be criminal offense, but tax evasion is the only activity that has been declared as civil offense in Switzerland.
For 2006, Scorpio Partnership’s Annual Private Banking Benchmark has nominated UBS AG as the largest private banking division of all time. Citigroup and Merrill Lynch are the next two that can gather more than $1 million assets under the label of wealth management for private clients.