Banque Bénédict Hentsch, a Swiss private bank in the process of merging with US hedge fund Fairfield Greenwich Group, has axed the tie-up after both firms disclosed exposure to investments linked to Bernard Madoff, the US billionaire accused of securities fraud.

Banque Bénédict Hentsch says the termination of its three-month partnership with New York-based Fairfield Greenwich Group is immediate.