“Their actions prevent systemic collapse but the deeper underlying problems remain,” he said in a statement to shareholders.
The City grandee and member of banking’s most famous family said policy was tempting people to increase how much risk they take with their investments, a strategy he would ignore.
RIT Capital Partners, the fund Rothschild founded in 1988 and still chairs, lost £77.9m in the six months to September after a £10.3m loss on sovereign bond and currency hedges. Almost £18m of losses were also made by external asset managers given money by the fund to manage.
“We intend to focus our investments on such individual situations and on external managers who recognise the new reality,” he said. Analysts said the drop in value meant Rothschild’s fund was now trading at an attractive discount.