The roots of the bank house go back to 1840. Safra Fréres et Cie. had offices in Istanbul, Alexandria, and Beirut. It financed caravans and trade operations. After World War I, the Banco Jacob Safra was opened in the Near East of Beirut. Later, the founder and his three sons emigrated to Brazil.
Death and Tensions between Brothers, Part 1
After Jacob’s death, the three brothers took different paths: Joseph and Moise took care of Banco Safra in Brazil, and Edmond built a worldwide banking empire in Europe and the United States. In 1999, he sold Safra Republic Holding in Luxembourg and Republic National Bank of New York to HSBC. Shortly thereafter, he died in his villa in Monte Carlo, in a room burned by his bodyguard. Joseph and Moise soon fought. Moise wanted to withdraw from the bank but did not sell his share to Joseph. It did not happen until 2006.
Death and Tensions between Brothers, Part 2
When Joseph was diagnosed with Parkinson’s disease, he and his wife spent a lot of time in Crans-Montana, Switzerland. From there, he ran the business. Later, his son Jacob took over the banking activities outside Brazil, with a focus on Switzerland. His son, Alberto, was in charge of the corporate customer business, and his younger son, David, took over the individual customer business. His daughter Ester led a private school called Beit Jaacov in Sao Paolo. Because of some tension between the heirs, the vice president of Banco Safra in Sao Paolo took over the role of mediator.
Alberto, the black Sheep of the Family?
In fact, the second-oldest Alberto was supposed to implement the bank’s digital strategy. But then Joseph decided that this should be done by the younger David. The founder never gave up control of his banking house. Later, this very fact turned out to be a mistake. A huge quarrel between the sons, heavily covered by the media, resulted in Alberto leaving the bank. He later founded his own fund company called ASA.
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Alberto accuses his family of reducing his shares with dirty tricks. In 2019, its value at the Safra National Bank of New York was only 13.5%, instead of 28%. It was supposed to be done through increased payments to the remaining family members. In addition, in Alberto’s opinion, his father´s will was changed. As he says, this happened at the time of illness, when the father was no longer able to decide for himself.
The family is resisting the charges. Their members say the father was so disappointed by his second-eldest son’s disloyal behaviour that he changed the will himself. Now the trial is to run in New York, but the family wants to relocate it to Gibraltar, where the bank holding has its headquarters.
Family Unrest, Success in Business
According to Bloomberg speculation, Alberto wants to sell his shares to the family in order to put an end to the quarrels. In Sao Paolo financial circles, it is said that the main reason for the family dispute is the far-too-late digitization of banking services. Banco Safra has just lost its time, and others have occupied the positions, such as Nubank, which suddenly acquired 90 million customers out of nowhere and reached a stock value of USD 38 billion.
But the damage has also brought good. According to Bloomberg, the fund ASA Investments of Alberto Safra has beat all its competitors in Brazil in return. And private bank J. Safra Sarasin is one of the most solid private banks on the Swiss market.
