|Variety within the Swiss banking system
Apart from numerous other qualities, the Swiss banking system is noted for its variety.
The Swiss banking system is based on the concept of universal banking, whereby all banks
can offer all banking services. Nevertheless, it has seen the development of different
bank groups that have come to specialize in certain areas.
The Swiss universal bank offers it all
The Swiss banking system is based on the model of universal banking. This means that all
banks can provide all banking services, such as:
is directly opposite of banking systems in English-speaking countries and in Japan
which separate commercial banking from investment banking. Legislation is, in fact,
currently underway in the United States to liberalize the system.
- credit/lending business
management and investment advice
- payment transactions
business (savings accounts, etc.)
- securities business (stock
- underwriting business (issuing of bonds)
- financial analysis
The advantages of universal banking include the ability to spread risk over a greater
number of banking businesses and customers from all sectors of the economy.
Specialized bank groups
Banking in Switzerland is extremely diverse, even though it is based on the principle of
universal banking. Several bank groups are now fully or partially specialized:
The "big" banks
The two "big" banks - UBS AG and the Credit Suisse Group - together account for
over 50% of the balance sheet total of all banks in Switzerland. UBS AG is the world's
leader in wealth management and also Switzerland's leading bank for individual and
corporate clients. It is also an important global player in investment banking and the
securities business. The Credit Suisse Group is a globally-active financial services
provider. Besides offering comprehensive financial advice to private clients, it offers
solutions through the Winterthur insurance company to pension and insurance questions and
as a financial intermediary it also serves global companies and institutions as well as
Formerly one to two per canton, there are today a total of 24 Cantonal banks (in
Switzerland's 26 cantons and half-cantons); Cantonal banks are
semi-governmental organizations with a state guarantee. Liberalization is currently
underway with respect to the state guarantee. Despite their close connection to the state,
cantonal banks must comply with commercial principles in their business activities. Their
objective, according to cantonal law, is to promote the canton's economy. Field of
activity: engaged in all banking businesses; emphasis on lending/deposit business.
Regional banks and savings banks
Smaller universal banks with an emphasis on lending/deposit business. These banks
voluntarily restrict their activities to one region. Advantage: customer proximity -- they
are acquainted with local circumstances and with regional business cycles.
The Raiffeisen Group
The Raiffeisen Group consists of affiliated independent banks with strong local roots and which are
organised along cooperative lines. They have a history of more than a century. The Raiffeisen banks
have the highest number of branches in Switzerland and they are all affiliated to the Swiss Union of
Raiffeisen Banks. The Union has the strategical leadership of the whole Group and is responsible for
the Group’s risk management. The Union also coordinates the Group’s activities, provides on-the-ground
framework conditions for the business activities of the individual local banks (e.g. IT, infrastructure,
refinancing) and advises and supports them in all matters so they can concentrate on their core business,
namely advising clients and selling banking services. The Raiffeisen Group is one of Switzerland’s leading
retail banks and has significantly increased its market share over the past few years.
Among the oldest banks in Switzerland. Legal form: individually owned firms, collective
and limited partnerships. Private bankers are subject to unlimited subsidiary liability
with their personal assets. Field of activity: asset management, chiefly for private
clients; as a rule, private banks do not publicly offer to accept savings deposits.
Foreign-control means that over half of the company's votes are held by foreigners with
qualified interests. Origin of banks: Europe, predominantly EU (over 50%), Japan (around
20%). Fields of activity: foreign business (share of foreign assets in the balance sheet
total is 70%), asset management.
This bank group includes banks with various business objectives, such as: institutes
specializing in the stock exchange, securities and asset management businesses; commercial
banks: as a rule, these are universal banks for which mortgage investments play a
significant role, in addition to commercial loans to trade, industry and commerce; and
consumer credit institutes: institutes specializing in small loans (to private individuals
and the industry).