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Review 2016/2017

Review 2016/2017

In the last 12 months, the Swiss Bankers Association (SBA) organised its structure along clear strategic areas of focus and aligned itself in a business-orientated manner. The team is complete and the SBA is positioned to act as a think tank for the stakeholder groups and members. The SBA has a clear ambition for the Swiss financial centre to maintain its leading position.

The best prerequisites are already in place today for continued success tomorrow. Switzerland is the world’s biggest location for cross-border wealth management. The Swiss financial centre has an exceptional variety of banks in international comparison, and the Swiss banks are internationally competitive. To ensure the Swiss banks remain successful in future, they must work to achieve the best possible framework conditions today.

The following three principles form the basis for preserving and increasing the appeal of the Swiss financial centre:

  • Firstly, openness: the SBA stands resolutely for market access and open markets, and is opposed to isolationist tendencies both at home and abroad.
  • Secondly, innovation: the SBA addresses industry trends proactively. Keywords here include developments relating to the cloud, how digitalisation is affecting the change in the customer interface, and outsourcing issues against the backdrop of rising industrialisation and efficiency gains.
  • Thirdly, competitiveness as a clear objective of regulation: there should be no rushing ahead when it comes to implementing international standards, we must keep an eye on what competing financial centres are doing.

Select issues addressed in 2016:

Promotion of the financial centre

Greater promotion of the financial centre in Switzerland and abroad

In its 2016 financial market report, the Federal Council formulated the objectives for the further development of the Swiss financial market strategy. In the report, the Federal Council recognises the important role that the financial centre plays for the Swiss economy and commits to promoting Switzerland as a competitive, leading global financial centre. Another welcome development is that according to its strategic goals to be achieved by 2020, the Swiss Financial Market Supervisory Authority FINMA is pursuing similar objectives. Close and intensive collaboration between all financial market participants, business, the authorities and politicians is necessary in order to credibly represent the interests of the financial centre and clearly position the Swiss financial centre at home and abroad.

One good example of how international awareness of the strengths of the financial centre can be further raised is the trip made by a delegation of industry representatives to Beijing, Shanghai, Singapore and Hong Kong over Easter 2017. The delegation was led by Federal Councillor Ueli Maurer, Head of the Federal Department of Finance (FDF). Discussions at the meetings in Beijing and Shanghai centred primarily around issues relating to market access, while in the global financial centres Singapore and Hong Kong, similar interests to Switzerland were expressed when it comes to the development of international standards such as Basel III / IV and the Automatic Exchange of Information (AEOI). The trip represents a milestone in the efforts of the SBA and the Confederation to better position the Swiss financial centre abroad. In the medium term, such and similar trips will play an important role as a financial market policy tool for Switzerland.

Occupational pension plan

Proposals for the optimisation of occupational pension plans

With the study “The 3rd contributor to occupational pension plans – Proposals for optimisation”, the SBA and the Asset Management Plattform provided proposals for the optimisation of occupational pension plans and have opened a dialogue in order to contribute to strengthening the Swiss pension system in Switzerland. To date, the returns generated on pension assets, the so-called 3rd contributor, were the most important contributor to our retirement capital. Notwithstanding its substantial contribution of around 40 percent, this fact has as yet not been taken into consideration in the political debate. It is becoming apparent, however, that in future it will not be possible to achieve the current target returns. There is therefore a threat of funding shortfalls and cuts to benefits in the pension system. In the study “The 3rd contributor to occupational pension plans – Proposals for optimisation”, asset management experts from various banks together with the SBA explore how the 3rd contributor can be strengthened in order to avert such an outcome. The study aims to bring momentum into the discussion surrounding occupational pension plans and provides concrete proposals for how to change the framework conditions. Pension funds and politicians are called on to reinforce the 3rd contributor in the interests of active pension plan members. The study also contributes to strengthening Switzerland as a location for asset management.

Fintech and digitalisation

Fintech and digitalisation are not just on the SBA’s radar, the SBA is actively contributing to the establishment of framework conditions for the banks, which are also part of this structural change. The SBA is doing so by campaigning for the best-possible, modern regulatory environment and created a fintech group of experts to this end in the summer of 2016. Its members consist of high-ranking representatives from all the banking groups. Among other things, the fintech group of experts monitors seminal fintech developments and analyses the suitability of framework conditions with a view to strengthening the finance industry and ensuring a level playing field for banks. By taking advantage of synergies and coordinating activities with other associations, for example Swiss Fintech Innovations and Swiss Finance Startups, efficient methods of operation are ensured. Through these efforts, the SBA is making an important contribution to the Swiss financial centre of the future.

FinSA/FinlA

Competitiveness, legal certainty and exportability with FinSA/FinIA

The major legislative project pertaining to the revision of financial market legislation remains in full swing. Over the last few years, the SBA has advocated both scaling down the draft in the interests of the sector and the economy as a whole, and ensuring that the requirements for financial services providers and products do not turn out to be more stringent than in other countries. The Council of States significantly improved and streamlined the bills for FinSA and FinIA, and adopted them in December 2016. As a result, Switzerland will have practicable investor protection. By virtue of the fact that predominantly existing laws will be systematically taken over into one source of law, legal and planning certainty will increase both for investors as well as for the sector. Positive momentum can also be expected in terms of the competitiveness and exportability of the Swiss finance industry. FinSA and FinIA reinforce legal certainty, competitiveness and the reputation of the financial centre. If the National Council is efficient in concluding its further considerations during the 2017 autumn session and FinSA and FinIA are implemented rapidly – at the latest by the beginning of 2019 – an important prerequisite for access to the EU market will have been established. Up-to-date financial legislation is in the interests of all financial services providers and their custom¬ers, and therefore a basic prerequisite for a healthy economy.

International exchange of information

After completing its peer review, the Global Forum on Transparency and Exchange of Information for Tax Purposes (Global Forum) gave Switzerland a “largely compliant” rating on 26 July 2016. This positive evaluation reflects the progress made in recent years in implementing the international standard on the automatic exchange of information upon request. Switzerland is also on track for the Automatic Exchange of Information (AEOI). Since January 2017, Switzerland has been applying AEOI with 38 states and in 2018 will exchange information with all EU countries and ten other nations for the first time. A further 43 countries are to be added next year. From a Swiss perspective, it must be ensured that confidentiality and data protection are adhered to and the relevant competing financial centres also enter into AEOI with these countries.

The fight against money laundering

In 2012, the Financial Action Task Force (FATF) revised its 40 Recommendations, resulting in a necessary revision of Swiss anti-money laundering mechanisms. The revised Agreement on the Swiss banks’ code of conduct with regard to the exercise of due diligence CDB 16 came into force on 1 January 2016. With the revision of this comprehensive set of rules, the Swiss financial centre responded to the increasing efforts to fight money laundering at the international level and the concomitant regulatory requirements and international standards. In its December 2016 Mutual Evaluation Report, the FATF recognised the quality of the Swiss mechanisms for fighting money laundering and terrorist financing, and the Swiss financial centre achieved an above-average result compared to those countries that had already been reviewed. The FATF also listed certain criticisms relating to legal mechanisms. The SBA expects sound judgement to be applied to any potential amendments to Swiss laws and ordinances, and that any form of “Swiss finish” is dispensed with.

Training and education

Uniform standard of quality: certification for client advisors

Competent client advisors constitute the core of all successful wealth management. With its recommendation that members certify their wealth management advisors under the Certified Wealth Management Advisor CWMA standard of the Swiss Association for Quality (SAQ), which meets the requirements of the international ISO standard 17024, the SBA in December 2016 declared itself in favour of a common standard as regards content. The additional person certifications for the private and individual client advisory segments, corporate banking and SMEs, as well affluent client advisors comprehensively cover the spectrum of client advisor profiles and will also be considered for recommendation. Using a common certification standard as a basis, it is possible to effectively and sustainably promote quality, professionalism and excellence among client advisors. And not least of all, a common industry standard allows transparency in terms of the level of training within the Swiss finance industry, which will also serve as an international seal of quality.