Banking secrecy issues could be eclipsed by new focus
BASEL, SWITZERLAND – The Swiss banking industry is not taking changes to its world lying down, with its traditional specialty of international wealth management looking increasingly fraught with difficulties. Asset management is the new buzz word for Swiss banks, whose Swiss Bankers Association (SBA) and Swiss Funds Association Thursday 6 December issued a white paper outlining the industry’s new focus for the future, although alongside its more traditional business.
Asset managers are already doing it, it requires little capital and is a low-risk business for banks because it’s not part of the balance sheet, say the two groups. Swiss banks already offer reliability, independence and quality, they point out, and strengthening this should make Switzerland a world capital for asset management.
“Trade associations, infrastructure providers and other industry bodies can promote recognised standards, good infrastructure and training issues. Regulation, market access and the tax situation, by contrast, are largely in the hands of politicians and the authorities, who must also do their bit to promote asset management,” they add, in a statement.
SBA CEO Claude-Alain Margelisch says, “The entire financial centre is backing this initiative to turn Switzerland into a top location for asset management. We hope that Swiss government bodies and regulators will support this. By doing so, we will put the financial centre on a broader footing, minimise systemic risks and create opportunities for the future.”
The white paper comes after months of attacks on the nation’s banking secrecy laws, supervision problems that led to a massive trading loss for UBS, legal tussles with the US government, data theft and tax dodging fallout with European neighbours not to mention the larger context of new capital requirements and a global industry that hasn’t recovered from the 2008 crisis.
Eight areas for action
The white paper offers eight areas “where targeted measures should create an optimal operating framework for offering products and services in Switzerland and abroad”, the two groups say in a statement issued Thursday.
1. Establishing asset management as a brand
2. Developing and applying standards for asset management
3. Ensuring appropriate regulation
4. Improving market access
5. Promoting the right vehicles and structures for asset management
6. Establishing an optimal tax environment (including various levies) for investors
7. Expanding infrastructure in a targeted manner
8. Providing specific training