Swiss Bank Introduction

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The Swiss 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:

  • Credit/lending business
  • Asset management and investment advice
  • Payment transactions
  • Deposit business (savings accounts, etc.)
  • Securities business (stock exchange transactions)
  • Underwriting business (issuing of bonds)
  • Financial analysis

This is directly opposite of banking systems in English-speaking countries which separate commercial banking from investment banking. The main advantage of this banking system for you is that you will find all banking services under one roof.

Central Bank

The Swiss National Bank (SNB) serves as the country's central bank. Founded by the Federal Act on the Swiss National Bank (16 January 1906), it began conducting business on 20 June 1907. Its shares are publicly traded, and are held by the cantons, cantonal banks, and individual investors; the federal government does not hold any shares. Although a central bank often has regulatory authority over the country's banking system, the SNB does not; regulation is solely the role of the Federal Banking Commission.

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. Credit Suisse is a leading global bank headquartered in Zurich. Credit Suisse is renowned for providing expert advice, holistic solutions and innovative products to a wide range of corporate and institutional clients and high-net-worth individuals globally, as well as retail clients in Switzerland.


UBS came into existence in June 1998, when Union Bank of Switzerland, founded in 1862, and Swiss Bank Corporation, founded in 1872, merged. Headquartered in Zurich and Basel, it is Switzerland's largest bank. It maintains seven main offices around the world (four in the United States and one each in London, Tokyo, and Hong Kong) and branches on five continents.

Credit Suisse

Credit Suisse is the second-largest Swiss bank. Based in Zurich, it was founded in 1856; its market capitalization (as of 2007) is US$95.2 billion, and the company has about 40,000 employees. Credit Suisse Group offers private banking, investment banking and asset management services. It acquired The First Boston Corporation in 1988 and merged with the Winterthur insurance company in 1997; the latter was sold to AXA in 2006. The asset management services were sold to Aberdeen Asset Management in 2008 during the GFC.

Cantonal banks

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. 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. At we advise our clients to negotiate primarily with cantonal banks of the canton in which the client wants to acquire a property. (Real estate lending is facilitated)

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.

Raiffeisen Group

As a group of banks with the largest branch network in Switzerland, the Raiffeisen banks together form Raiffeisen Switzerland, which is responsible for the entire Raiffeisen Group strategy and for group-wide risk management. It also coordinates the group's activities, creates the conditions for the business activities of the local Raiffeisen banks and advises and supports them in all issues. The bank group, which is structured as a cooperative, is one of Switzerland's leading retail banks. In recent years, Raiffeisen has positioned and established itself as the third largest bank group in Switzerland. Raiffeisen meanwhile counts 3 million Swiss citizens among its customers. Of these, some 1.4 million are members of the cooperative and hence co-owners of their Raiffeisen bank. They value the decisive benefits of Raiffeisen: Proximity to the customer, support, reliability and the exclusive benefits for members of the cooperative.

Private banks

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.

The term private bank refers to a bank that offers private banking services and in its legal form is a partnership. The first private banks were created in St. Gallen in the mid-18th century and in Geneva in the late 18th century as partnerships, and some are still in the hands of the original families such as Hottinger and Mirabaud. In Switzerland, such private banks are called private bankers (a protected term) to distinguish them from the other private banks which are typically shared corporations. Historically in Switzerland a minimum of CHF1 million was required to open an account, however, over the last years many private banks have lowered their entry hurdles to CHF250,000 for private investors.

Bank client confidentiality

Legal basis

The Swiss banker's professional duty of client confidentiality is rooted in Article 47 of the Federal Law on Banks and Savings Banks, which came into force on 8 November 1934. The article stipulates that anyone acting in his/her capacity as member of a banking body, as a bank employee, agent, liquidator or auditor, as an observer of the Swiss Federal Banking Commission (SFBC), or as a member of a body or an employee belonging to an accredited auditing institution, is not permitted to divulge information entrusted to him/her or of which he/she has been apprised because of his/her position.

One issue of the time that reinforced the passage of this law came during the era of Hitler when a German law stated that any German with foreign capital was to be punished by death. Swiss banks were watched closely by the German Gestapo. It was after Germans began being put to death for holding Swiss accounts that the Swiss government was even more convinced of the need for bank secrecy.

Although the Federal Law refers to "banking secrecy", it is important to note that this duty of discretion is not intended to protect the bank but the client. In that sense, the terms "bank client confidentiality" or "financial privacy" are much more appropriate.

Although a desire for privacy can play an important part in an investor's decision to deposit his/her assets in a Swiss bank, it is not the sole factor in the decision. One should not forget that Switzerland's political and monetary stability, its excellent infrastructure and the professional know-how and experience of its bankers are also attractive factors.