Immigration vote ‘threatens Swiss private banks’

The banking district in Geneva could come under pressure Keystone

The introduction of limits on EU citizens threatens the position of Geneva and Switzerland as a financial centre, warns Yves Mirabaud, president of the Association of Swiss Private Banks.

In an interview with the SonntagsZeitung, Mirabaud said that if no quick agreement could be reached with the European Union, private banks would be forced to reduce staff significantly and open branches in Europe.

He said it was not a question of whether Swiss banks survived, “but whether they remain Swiss banks or have to become Swiss banks abroad – with all the effects on the job market in our country”.

On February 9, 2014, a narrow majority (50.3%) of Swiss voters approved an initiative by the rightwing Swiss People’s Party to impose limits on the number of workers allowed into Switzerland from EU and EFTA countries. Parliament then had three years to implement this – in other words, by February 9, 2017.

With less than four months to go, no satisfactory solution has been found. The problem, as Brussels was quick to point out, is that curbing immigration in Switzerland would violate an agreement on the free movement of people, one of the EU’s central tenets, that Switzerland signed on to in 2002 as part of a package of bilateral accords.

The Swiss cabinet thus finds itself in the seemingly impossible position of implementing an initiative that demands limits on free movement while not jeopardising bilateral accords with the EU.

Taste of things to come

Geneva succeeded as a financial location for many years, but private banks have recently been going through a tough period. Mirabaud sees this development as a taste of things to come.

He said Switzerland had been working for a long time to get improved market access to the EU, but negotiations on this had been blocked by the acceptance of the People’s Party initiative.

Mirabaud avoided blaming the People’s Party directly. “I merely maintain that certain political parties and actors are intent on tearing down what Switzerland has successfully built up with the EU over the past 20 years,” he said.

At the same time, Mirabaud admitted that the banks had failed to do their bit to gain market access. Around 15 years ago, the EU offered Switzerland market access on condition of the automatic exchange of client data. The banks rejected this offer.

In doing this, Switzerland had lacked foresight, said Mirabaud, adding that he would have negotiated more decisively and with greater purpose.

“But giving up banking secrecy was at the time simply unimaginable politically,” he said.