Bank groups

Bank groups

In addition to numerous other qualities, the banking sector in Switzerland distinguishes itself through its diversity and heterogeneity. Over time, very different banking groups have developed and to some extent become specialised.

The model "Swiss universal bank"

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
  • deposits and deposit business (savings accounts, etc.)
  • asset management and investment advice
  • payment transactions
  • securities business (stock exchange transactions)
  • underwriting business (issuing bonds or shares)
  • financial analysis

Banks that are active in Switzerland can be divided into the following banking groups:

Big banks

The big banks offer essentially every type of transaction, particularly investment banking (capital market transactions, trade with securities, performance of money market transactions, financial engineering, securitised lending transactions as well as consulting in and conducting mergers and acquisitions). A strong international focus and business network is a characteristic shared by the big banks. The group of big banks includes Credit Suisse and UBS AG. Both big banks have branches and subsidiaries in more than 50 countries and are present in all major financial centres around the world. Together, the two big banks account for over 50% of the balance sheet total of all banks in Switzerland.

Cantonal banks

Most cantonal banks operate in all fields of business, although they are particularly strong in the savings and mortgage business. In a few cases, asset management for domestic customers also plays an important role. Cantonal bank operations are largely focused on their own canton, although some of them have branches outside their canton or offices even outside the country. Most cantonal banks are institutions under public law, with their own legal status. There are also some semi-private and private joint-stock companies. The Association of Swiss Cantonal Banks was founded in 1907. It acts for the category as a whole and promotes co-operation between its members. Since the revision of the Banking Act on 1 October 1999, a cantonal guarantee has no longer been regarded as the constitutive feature of a cantonal bank. The Canton of Berne then began to phase out its state guarantee in a gradual process terminating in 2012. However, it is the only canton to take this step. Even before the revision of the Banking Act, there was no cantonal guarantee for the Banque Cantonale Vaudoise while the cantonal guarantee for the Banque Cantonale de Genève was limited. All other cantonal banks will retain an unlimited cantonal guarantee. As at the end of 2014, the cantonal banks’ total assets ranged from CHF 2.6 billion to over CHF 158 billion.

Foreign banks

Many foreign-controlled banks operate in all fields of business, but some of them focus on asset management or investment banking. In the case of asset management, the clientele is usually foreign. In addition, a number of these institutions are active in trade finance. Since 1972, all foreign banks have belonged to the Association of Foreign Banks in Switzerland. Foreign banks include both the foreign-controlled banks operating under Swiss law and the branches of foreign banks operating in Switzerland.

Raiffeisen banks

Raiffeisen banks are the only group of banks structured as co-operatives. They are associated in the Raiffeisen Switzerland co-operative. At the beginning of 2016, the Raiffeisen Group consisted of 292 independent, regionally rooted co-operative banks with a history that goes back more than a century. The Raiffeisen banks focus mostly on traditional interest rate business with mortgages and corporate loans, on the one hand, and customer savings and deposits, on the other. Although most of the business done by individual offices is regional, the Raiffeisen Switzerland Cooperative operates throughout the country. Within the Raiffeisen group, Raiffeisen Switzerland Cooperative takes on operational and strategic tasks and is the body bearing ultimate liability. In this function, Raiffeisen Switzerland Cooperative guarantees all Raiffeisen bank liabilities. The Raiffeisen banks bear joint liability for one another. In business operations, Raiffeisen Switzerland Cooperative is responsible for various functions including central banking (equalising cash holdings, holding liquidity balances and refinancing), bank transactions (interbank transactions and securities trading) and risk diversification.

Other banks

This category covers all banks that cannot be included under another heading. Consequently, there are no significant features in common.

Banks that specialise in stock exchange, securities and asset management business

Stock exchange banks operate mainly in the field of wealth management. They serve clients both inside and outside Switzerland. Since 1981, the Association of Swiss Commercial and Investment Banks has represented the interests of the banks in this category.

Regional and saving banks

Most banks in this category focus on traditional interest rate business with mortgages and corporate loans, on the one hand, and customer savings and deposits, on the other. Their business operations resemble very much the business operations of the smaller cantonal banks; their geographic field of business is generally smaller. Their advantage is customer proximity; they are acquainted with local circumstances and with regional business cycles. Most regional and saving banks have preserved their local character and are still today often organised as cooperatives or as stock companies with their securities being held by their own customers or the local population. Most regional banks are present on The association of Swiss regional banks (RBA) was established in 1971, and most of the banks in this category then joined the association. The RBA-Holding AG was created in 1994. Its membership is decentralised and autonomous. RBA-Holding AG services are available to assist members in back-office operations. 14 banks withdrew from the RBA-Holding AG with effect from 1 January 2006. Most of them combined to form the Esprit interest group. In 2004, Clientis Group was established as a collaborative venture between medium-sized and smaller RBA banks and Clientis Ltd. The Clientis Group is organised legally in the form of a simple partnership, with Clientis Ltd carrying out the executive functions. Clientis Ltd provides members with access to money and capital markets, as well as centralised support and transaction services.

Private bankers

Most private bankers work in the field of wealth management and consist of individual enterprises, collective and limited partnerships. Their clientele is both domestic and foreign. The Swiss Private Bankers Association, founded in 1934, represents private bankers. The association’s main function is to preserve and safeguard private bankers’ professional interests. Only banks within the private bankers category are included in the association. At the beginning of 2014, a new Association of Swiss Private Banks (ASPB) was founded alongside the Swiss Private Bankers Association. It represents the interests of privately owned Swiss banks specialising in asset management. The new association was founded when four private bankers converted to joint-stock companies on 1 January 2014 and were reclassified under the stock exchange banks category instead of the private bankers category, as previously. Together with other private bankers, these four banks belong to the new ASPB. Membership of the ASPB therefore includes banks from two categories – stock exchange banks and private bankers. A differentiation is made between two different categories of private bankers – those which actively seek deposits from the public and those which do not actively seek deposits from the public. Until 2001, institutions were listed in both categories. Since 2002, there have only been institutions which do not actively seek deposits from the public. Private bankers who do not actively seek deposits are not required to publish either annual or interim financial statements.

Further organisations of the Swiss banking centre