Swiss Private Banks Looking to Target Overseas Growth

Swiss private banks are looking to target overseas growth as the uniqueness of their brand diminishes. Despite the global crackdown on tax evasion, led by U.S. law authorities, many continue to see Swiss banking as the dodgy path for tucking away ill-gotten wealth, but this is allegedly no longer the case.

Swiss banking gained acclaim and notoriety due its prized secrecy. However, as it becomes more transparent some question, ‘Why choose Swiss banking?’ Well, the answer to that question isn’t necessarily a clear-cut answer, but the short answer is Swiss banks have so much more to offer than a private screen. Switzerland’s private banks are facing a harsh new reality, due to stormy global financial markets and lagging interest thanks to the regularisation of taxes.

Private banks are dwindling, and simultaneously there’s been a rise in regulatory costs that devour the profit margins for those remaining within that industry. With that said, supporters of the industry refuse to retire. They’ve proven their dedication by leading expansion into emerging markets, thus demonstrating strength in order to retain dominance in this realm. After all, private banking was invented and popularized in Switzerland, and Swiss bankers have long protected the assets of patrons. Some banks manage as much as $306 billion (U.S.) in client assets.

As there has been a broader decline in bank activity, some banks continue to be a trusted home for client assets. In 1995, there were 350 private banks in the nation, now there are just 150 private banks.

Since 2009, Switzerland has signed agreements that effectively changed the game. They’ve paid more than $780 million in fines in order to settle matters with U.S. authorities, and wealth managers have insisted upon their dedication to transparency regarding fiscal and tax matters. However, the Panama Papers leak did hint at the prevalence of past practices and whispered of illicit offshore accounts that house wealth for super-rich individuals, guarding it against taxes and audits. Three Swiss banks were among the ten lenders fingered for holding accounts.

Swiss bankers have spoken out in defense of offshore account, iterating that hiding something does not denote illegality. Instead, they understand that patrons simply seek the protection of privacy, estate planning, and etc. Also, Swiss bankers continue to believe they offer services that others can not: they speak more languages, they’re discreet, they issue a wider variety of tax statements than rivals, and they operate accounts in more currency. Moreover, Swiss banks have the experience.

While the Swiss tend to bank with Swiss private banks, non-Swiss foreigners seek out international institutions, which challenges assertions that American private banks are closing in on Swiss’ home turf. However, it takes more a Swiss registry or a Swiss owner to deliver results, Swiss banks have earned their stripes because they host some the biggest lot of wealth managers, they hold accounts for large enterprises, and they seek out international expansion, targeting Russia, Africa, and the Emirates. In order to accomplish this, Swiss banks rely on old strengths, which include offering incomparable service. Switzerland remains the epicenter for offshore funds.