An international trust group based in Geneva, Close Summit Trust Company, has been renamed as Summit Trust International, to reinforce the independent nature of the business at a time of major changes affecting the sector.

An international trust group based in Geneva, Close Summit Trust Company, has been renamed as Summit Trust International, to reinforce the independent nature of the business at a time of major changes affecting the sector, its chairman has told WealthBriefing.

The company was originally incorporated in September 1999 as Close Trustees (Switzerland) when it was formed as a joint venture company between London-based Close Brothers Group and the Geneva management team. The firm later moved to the co-branded Close Summit Trust name when management bought out a majority interest in the firm in 2008. Under that structure, London-listed Close Brothers owned 20 per cent of the company, which remains under the new brand.

Among other changes, Stella Mitchell-Voisin has been appointed as managing director. Daniel Martineau, former managing director, stays with the company as executive chairman.

Besides its base in Geneva, the company has subsidiaries in the UK, New Zealand and Cayman Islands.

“One difference that you should expect from the newly branded Summit Trust International is that we will be pursuing more international aspects outside of our main service platform in Switzerland,” Martineau said in a statement.

“We believe that our clients’ needs will take us to a stronger multi-jurisdictional presence,” he added.

Later, in a separate interview with this publication, Martineau said he predicts major changes in the trust sector, particularly on the retail side, where he said modest returns and rising regulatory costs are squeezing margins. On the other hand, for trusts catering to ultra high net worth individuals, the business outlook is much rosier, he argued.

"The retail part of the business is falling away and falling away quickly because of regulatory price pressures, and because of risks associated with structures that are not well planned and executed,” he said.

"With zero interest rates, people are paying more attention to the fees [on trusts]. There is a combination of rising fees and low rates of return. The sector is now under huge pressure," Martineau continued.

For the purposes of definition in this case, he said that  "retail" applies to any trust with £1 million assets or less.

Margins on the trust sector have been squeezed by a double-whammy of modest returns in recent years, aggravated by wafer-thin interest rates, and rising costs.

"This [margin] issue will affect everybody in the international private client business exposed to the lower end of the market. Banks have a further problem - they have a growing realisation that if they are running non-compliant [trust] structures, they are running a huge risk in terms of financial liability and reputational damage. The real opportunity is the multi-jurisdictional, independent business at the higher level. That is still very much a growing market," he added.