Kathrein Privatbank: It’s Been a Tough Year All Round, But There Are Strategies to Cope

Austria’s Kathrein Privatbank has managed to deliver for its clients through active portfolio management — and an emphasis on sustainability.

Wilhelm Celeda, CEO of Austria’s Kathrein Privatbank, agrees with the international assessment: 2022 was a particularly challenging year for investors.

Wilhelm Celeda

It presented a rare scenario: both bonds and equities suffered negative performance and heavy price losses. From January, most stock markets have been in a bear phase. The mixture of high inflation, lower earnings expectations and generally poor sentiment continues to be “an unpalatable cocktail” for equities.

Resilience in the Portfolio

The investment environment may have been challenging, but active portfolio management allows for the continuous adaptation of investment strategy to the current circumstances. “We have implemented strategies in our portfolios that outperform the market in this challenging environment,” says Wilhelm Celeda.

“In the equity sector, the focus is on defensive stocks, and those with pricing power. We won a record of six Austrian fund-of-funds awards this year — something that underscores the quality of our portfolio management.

“In the bond sector we invest in local currency bonds of emerging countries to generate higher returns — but only in issuers with excellent credit ratings, such as development banks.”

To generate an upside for clients in such an environment, trend-tracking is another option. “Some of our funds and portfolio strategies offer the possibility to take short positions and create positive returns with significantly less risk.” Kathrein Privatbank’s investment strategy has been defensive since February 2022, “which has clearly paid off for customers”.

Long-term Sustainability

Sustainability is front and centre at Kathrein. “We’re convinced that responsible business practices contribute to a better quality of life for generations to come.” This is no knee-jerk reaction to recent global upheavals; the private bank began its first sustainable investments in 2012.

“We have invested around 50 percent of the total fund volume, abiding by the sustainability approach,” says Celeda. “We increased the number of sustainable funds, certified by independent organisations.” Three were added in 2022.

Kathrein was the first private bank in Austria to introduce sustainable gold. Its clients can buy bullion — certified by the London Bullion Market Association — in amounts from two to 1,000 grams. Gold adhering to this standard ensures minimum CO² emissions and exemplary ESG standards throughout the production process.

“We are proud to offer our clients an outstanding performance,” says Celeda, “paired with relentless commitment to sustainability.” There will be no change to that policy: “We strive to elevate the rate of our sustainably managed assets — and to deliver outstanding performance.”

Whatever market forces may present themselves, where there is a will, and resilience, there is a way. “To manoeuvre through turbulent times,” Celeda says, “you need patience, the right strategy, and a trustworthy partner by your side.”