What exactly is a private bank / private banking?

I have been approached by Fortis Bank which is a private bank with an excellent credit rating. I'm wondering whether to return the call....mmm.... Does anyone know what precisely a private bank is and what it offers?

Is money on deposit with them any safer than with the banks and building societies where its safety is guaranteed up to £35,000 with any institution. And are interest rates comparable? Or do they hope to "professionally" run my investments? (No chance!)

I have a larger holding. I thought about splitting it between a few banks up to the maximum safe threshold but it seems a bit bothersome.

So what do the very rich do?

Private banks are banks that are not incorporated. A non-incorporated bank is owned by either an individual or a general partner(s).

usually private banking is more about the personal services and approach they provide, in particular with regards to wealth management. AFAIK there is no additional protections are afforded.

Thanks Arbitrageur!

So how do the super rich ensure their money is safe? Where do they lodge it?

catt said:

Thanks Arbitrageur!

So how do the super rich ensure their money is safe? Where do they lodge it?

Click to expand...

Northern Rock?

catt said:

Thanks Arbitrageur!

So how do the super rich ensure their money is safe? Where do they lodge it?

Click to expand...

Can't speak for the race in general but I know of at least one super-rich (we're talking millions here - and it's not me!) who entrust to a top-notch firm of financial advisers who invest in very boring mundane but relatively safe funds / gilts etc etc. Allocation for clients is done according to investor's requirements in relation to risk & return - and I do know that much time, effort and expertise is expended. Just like any sensible person would look after their money, presumably.

catt said:

Thanks Arbitrageur!
So how do the super rich ensure their money is safe? Where do they lodge it?

Click to expand...

If you need access to the cash quickly you can buy T-Bills.

Treasury bills for ordinary folks | Wise Bread

There must be some uk equivalent ..

The super rich will actually have their own private offices with a personally employed team to manage their investments. I had a look at working in one in Geneva - about five people whose job it was to manage an old family's money across a range of asset classes. The 'merely' rich have to make do with commercial private banking, where the same services are offered on a larger scale. Its far more about wealth management, so they are after your liquid assets to invest on your behalf (and is how they make their money) - if all you want is a 100% secure deposit account they won't really be interested.

If I just wanted security on deposits over the £35k g'tee, I'd either spread it around, or put it all in Northern Rock which is now as safe as a government gilt.