Austria wealth management: Vienna private banking, mandates and foundations

A private banking tradition in Vienna for wealth management in Austria

Austria wealth management covers the private banking services offered in Vienna, Salzburg and other major cities, overseen by the FMA and MiFID II rules, to manage financial assets through a discretionary mandate or an advisory relationship. Vienna hosts long-established private banks such as Bank Gutmann and Schoellerbank, besides the wealth arms of large groups, serving Austrian families, Central European entrepreneurs and foreign investors with a link to the country.

Vienna is home to long-established private banks such as Bank Gutmann and Schoellerbank, as well as the wealth management arms of the large banking groups. Their clients include Austrian families, Central European entrepreneurs and foreign investors with a link to the country.

Austria wealth management mandates: bank decides or client approves

Under a discretionary mandate, the bank makes investment decisions within an agreed risk profile; under advice, the client approves each transaction. In both cases MiFID II requires a suitability assessment and detailed disclosure of all costs.

The Wertpapierdepot securities account

An Austrian client's securities are held in a Wertpapierdepot kept separate from the cash account. If the bank fails, these securities are not part of its estate and can be transferred, which is the main protection for a portfolio.

Investor compensation up to EUR 20,000

The investor compensation scheme covers claims relating to a failed bank's investment services at 90%, capped at EUR 20,000 per person. It supplements, rather than replaces, the deposit guarantee limited to EUR 100,000.

Taxation of investment income for residents

For an Austrian resident, dividends and capital gains on securities are generally subject to 27.5% KESt deducted by the custodian bank, while deposit interest is taxed at 25%. A non-resident falls primarily under the tax rules of their country of residence.

The Privatstiftung, Austria's private foundation

Since the 1993 law, a private foundation can hold family assets and distribute income to designated beneficiaries. It is entered in the Firmenbuch, its beneficiaries appear in the WiEReG register, and banks identify it like any other wealth structure.

What has changed for banking secrecy

Banking secrecy remains in the Austrian Banking Act, but it no longer prevents automatic exchange of information with partner countries. A client resident in France has their accounts reported under the CRS and must also file form 3916 themselves.

A private bank's fee schedule

Austrian private banks usually charge an annual fee as a percentage of the portfolio, plus custody and transaction fees, or an all-in flat fee. The annual cost report required by MiFID II makes it possible to compare offers in euros.

Accessing the Erste group's private bank

At Erste Bank, wealth management is aimed at clients with significant financial assets, offering a dedicated adviser and mandates tailored to the risk profile. The entry amount and the terms for non-residents are discussed at a first meeting.

Source of wealth: what a foreign client documents

An Austrian private bank asks foreign clients to document the origin of their wealth: sale of a business, inheritance, professional income or earlier investments. Sale agreements, estate documents and older statements form the core of this file.

Starting wealth management in Austria: the steps

The first step is to clarify your objectives: preserving capital, organising succession, diversifying a portfolio or entrusting part of your securities to a manager. Depending on your choice, the bank will propose a discretionary mandate, investment advice or simple securities custody. Write down your expectations before the first meeting with the dedicated adviser. Austria wealth management is therefore prepared step by step.

The second step is choosing the institution. Vienna is home to long-established private banks as well as the wealth management arms of the large groups. Compare their entry level, fee schedule, conditions for non-residents and quality of reporting. Ask for these items in writing so that you can compare two or three offers rigorously.

The third step is filing the application, followed by the compliance review. In practice, timing depends on the bank and the complexity of the estate, and no acceptance is guaranteed in advance. Expect the bank to run a suitability assessment of your objectives and risk tolerance before proposing a mandate.

Source of wealth: documents for an Austrian private bank

An Austrian private bank asks foreign clients to document the origin of their wealth: sale of a business, inheritance, professional income or earlier investments. Sale agreements, estate documents and older statements form the core of the file. Gather these documents before the first meeting, in chronological order, with a short summary note.

Add a certified passport, recent proof of address, bank or professional references and proof of your tax compliance in your country of residence. If you are considering a Privatstiftung, the bank also identifies the structure, its beneficiaries entered in the WiEReG register and the people who control it. A clear chart reduces follow-up questions.

Be ready to explain amounts, dates and transfer routes. A large transfer without supporting documents almost always triggers a request for clarification. Keep correspondence with the bank, and the documents you sent, so that you can answer quickly during periodic file reviews, which are part of the normal running of a wealth relationship.

Common mistakes in wealth management in Austria and questions to ask

A frequent mistake is to confuse deposit guarantee and securities protection. The deposit guarantee is limited to EUR 100,000, while the investor compensation scheme covers 90% of claims, capped at EUR 20,000 per person. The real protection of a portfolio lies in holding securities in a Wertpapierdepot separate from the cash account.

Ask precise questions: entry amount, annual fee as a percentage of the portfolio, custody and transaction fees, or all-in flat fee. The annual cost report required by MiFID II lets you compare offers in euros. Also ask how the bank treats non-resident clients and what information it passes on under automatic exchange.

Finally, question the bank about the mandate: investment universe, risk profile, reference currency, reporting frequency and termination terms. Under a discretionary mandate the bank decides within the agreed profile; under advice you approve each transaction. Avoid promises of returns, which have no place in a serious Austrian private bank offer.

Tax, CRS and checks for Austria wealth management

For an Austrian resident, dividends and capital gains on securities are generally subject to 27.5% KESt deducted by the custodian bank, while deposit interest is taxed at 25%. A non-resident falls primarily under the tax rules of their country of residence, which remains the reference for declaring investment income.

Banking secrecy remains in the Austrian Banking Act, but it no longer prevents automatic exchange of information. A client resident in France has their accounts reported under the CRS and must also file form 3916 themselves. It is better to raise this at the first meeting about wealth management in Austria than to discover it later.

Finally, verify the information with the FMA, the tax administration and an independent adviser. This guide does not replace personalised advice, and no account opening or acceptance for management is guaranteed by a bank before it has finished its checks.