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Reinventing Banking, the Swiss challenge

Recent reports are showing a dramatic reduction of the number of participants and the importance of the Swiss private banking system.

A KPMG conducted study in cooperation with the University of ST Gallen reportedly stated that out of the 87 bank participating, 34% showed weak performance.

The number of strong performing private banks decreased from 26 to 19.

As secrecy rules were modified 5 years ago and with the increasing pressure for transparency, the famous secret jurisdiction has got a major hit while the industry is not showing signs of reinvention.

back in 2010 Switzerland had authorised 163 private banks versus the 101 standing as per 2019, and KPMG estimations are that soon the industry will be composed of below 100 participants.

The report notes that there is a high probability of numerous participants leaving the market in the next years to come.

The reported information stated: “Costs consumed a record 87.2% of income on average for small banks (with less than CHF5 billion AuM), leaving them with a wafer-thin profit margin of 12.8%.” making a link between regulation, salaries and other specifics of the financial sector with the reduced margins in a more competitive and far more cross-border activity.

Source

https://www.swissinfo.ch/eng/perfect-storm_many-swiss-private-banks-facing–extinction-/45178358

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Jaime Prieto

Mr. Jaime Prieto is a lawyer experienced in Financial Crime, Anti-Money Laundering and Counter Terrorism Financing having extensive professional experience in both public and private sectors. Mr. Prieto has been a Head of Compliance in the European Union, the Americas and the Caribbean for banks, trust companies, asset managers, Big Four audit and advisory firms, RegTechs, government agencies and other types of financial professionals. In addition to his experience, he has been legal and educational chair in several compliance and sectorial organisations and performed as a teacher and speaker for a number of organisations and in several local and international forums. Furthermore, Mr. Prieto is an experienced Money Laundering Reporting Officer anda Data Protection officer with additional experience in risk management.
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