The Swiss private banking sector saw a resurgence in fortunes last year but faces an uncertain future as the Covid-19 pandemic continues to play havoc with financial markets.
This content was published on
2 minutes
swissinfo.ch/mga
Favourable market conditions in 2019 allowed the 84 banks surveyed by KPMG to grow client assets by 14%, according to a recently published report by the audit firm. Most of this growth was created by flourishing financial markets, with just 3% attributable to fresh deposits from the world’s wealthy.
Nevertheless, the annual “Clarity on Performance of Swiss Private Banks” report heralded the return of “net new assets” to Swiss coffers as a potential turning point in the sector’s fortunes. The ability to attract fresh inflows of money from around the world and to help clients grow their wealth are highlighted as key metrics in determining the health of private banks.
The situation so far this year is proving harder to judge. While the report suggests that some banks have leveraged the Swiss safe haven status to attract new funds, others are clearly struggling as clients bailed out of investments.
Julius Bär saw net new asset deposits of CHF5 billion in the first six months of 2020, but this was well down on the CHF6.2 billion recorded during the same period last year. Credit Suisse saw inflows drop by almost three-quarters while UBS saw little change.
KPMG predicts that private banks will struggle to attract new clients for the rest of the year as travel restrictions continue to hinder the all-important face-to-face meetings usually required to persuade people to open new accounts.
This could have a knock-on effect for revenues, which showed some promising signs of improvement in 2019. However, net profits continued to underwhelm as banks struggled to keep staffing, regulatory and IT costs under control.
Only one private bank ceased operations last year, bringing the number down to 101 from 163 in 2010. One more bank has disappeared already this year and two mergers are pending.
KPMG repeated its oft-quoted prophesy that more private banks will disappear from the landscape in the coming years, particularly smaller branches. Those that fail to adapt to the changes imposed by Covid-19 are most likely to fall, says the report. Its authors say as many as 30% of existing banks face such a risk.
Train vs plane: would you take a direct train between London and Geneva?
Eurostar is planning to run direct trains from Britain to Germany and Switzerland from the early 2030s. Would you favour the train over the plane? If not, why not?
Man charged with flying drone at women’s Euro 2025
This content was published on
A man flew a drone around the venue on Wednesday evening during the first match of the Women's EURO 2025 in St. Gallen. The 30-year-old violated the absolute ban on flying during match days. He was reported to the police.
More than 250 Swiss companies sign CO2 reduction initiative
This content was published on
A total of 257 companies from Switzerland have signed up to the Science Based Targets Initiative (SBTi). In doing so, they are committing to CO2 reduction targets that are compatible with the Paris Climate Agreement.
Swiss accident prevention group sees federal targets at risk
This content was published on
The Swiss government's target for accident figures is at risk, reckons Mario Cavegn, member of the executive board of the Swiss Council for Accident Prevention.
Feminicide: Swiss justice minister calls for electronic monitoring
This content was published on
Swiss Justice Minister Beat Jans has called for electronic monitoring and an ankle bracelet warning system for perpetrators of violence against women.
This content was published on
American artist Chaka Khan ‘and friends’ opened the 59th Montreux Jazz Festival on Friday. For over three hours, their show, dedicated to their friend and mentor Quincy Jones, thrilled the audience,
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.
Read more
More
Falcon exits Swiss private banking after 1MDB scandal
This content was published on
The company says it has changed its name to “Falcon Private” but will remain under the supervision of the Swiss Financial Market Supervisory Authority (FINMA) while it hands over its private banking clients and assets to the unnamed bank. “Three years ago, we gave Falcon Private Bank a new profile through innovative ideas and unconventional…
Credit Suisse-owned bank brand disappears in savings drive
This content was published on
Switzerland’s second-largest bank will ditch its subsidiary, Neue Aargauer Bank (NAB), as part of plans to save CHF100 million ($110 million) in annual costs. Credit Suisse group plans to reduce its number of branches from 146 to 109 and prioritise its digital services.
‘Next generation’ private bank plans to open doors in Switzerland
This content was published on
“Banking is to be redefined, and the use of technology should ensure that employees and customers receive a higher esteem than many banks do today,” says chairman David Bisang, who last year founded the blockchain company Heymate. But Tallyon is remaining tight-lipped about how exactly it plans to “democratise” private banking in Switzerland, other than…
You can find an overview of ongoing debates with our journalists here . Please join us!
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.