The Association of Foreign Banks in Switzerland introduced its inaugural Foreign Banks in Switzerland Barometer during a presentation in Zurich. Authored by the economic research institute BAK Economics, the commissioned study draws on a non-representative survey encompassing 61 foreign banks and 79 Swiss companies. This premiere marks a departure from the association's traditionally reserved external communication style, a shift that became apparent following the collapse of Credit Suisse.
Timing for the study aligns with ambitions expressed by various foreign banks following the exit of Credit Suisse, when institutions publicly stated intentions to expand their corporate client business in Switzerland. Economic observers had feared a contraction and price increase in credit and financial services for domestic enterprises. The study examines the standing of foreign institutions three years subsequent to that market restructuring.
In the first segment of the report, foreign banks evaluated Switzerland as a location from the perspective of their international parent groups. Measured on a scale from 1 to 10, the barometer value reached 8.7 regarding the likelihood of recommending further investments or expansion into Switzerland. Regarding trends, 51 percent of participating banks consider Switzerland more attractive than three years ago, while 30 percent view it as less attractive. The overall assessment rests on nine central location factors. Regulation and compliance, artificial intelligence, digitalization and cloud computing, and market access to the European Union and European Economic Area scored the weakest.
The second segment reflects assessments from Swiss enterprises, predominantly larger and export-oriented industrial companies. Over a third of these firms already maintain business relationships with a foreign bank, a proportion exceeding three quarters among firms with export ratios surpassing 50 percent. Respondents particularly value the international network and global presence of these banking groups, with seven out of ten corporate users stating their foreign bank services could not be easily replaced.
Regarding fallout from the Credit Suisse collapse, nearly one in four surveyed companies either altered its primary bank relationship or established an additional banking connection. Several corporations also reported elevated financing costs, stricter credit limits, and extended processing times as secondary effects.
During the media briefing in Zurich, AFBS Chairman Adrian Nösberger advocated for a diverse domestic banking landscape to sustain competition and client choice, noting that a national champion capable of competing globally remains essential amid discussions surrounding the potential relocation of UBS. BAK Chief Economist Claude Maurer addressed digital assessments, clarifying that lower scores in artificial intelligence compared to digital assets do not indicate general technological backwardness. Instead, Maurer attributed the lower AI ratings to strict Swiss data protection and privacy regulations that restrict cross-border data exchanges required for cloud and artificial intelligence applications.
AFBS General Secretary Raoul Würgler cautioned against setting excessive expectations regarding foreign banks as credit providers, noting that foreign institutions lack the domestic retail deposit base utilized extensively by cantonal banks and UBS. Würgler also addressed regulatory hurdles concerning the European Union, stating that EU regulations complicate cross-border business from Switzerland and introduce new directives restricting potential clients from utilizing Swiss banking services. Furthermore, Würgler criticized the Swiss implementation of Basel III, pointing to stricter timelines and capital requirements compared to other jurisdictions, which he argued negatively impacts commodity trade finance operations due to the absence of exemptions for short-term lending.
