Equity research analysts at Zürcher Kantonalbank, which is itself unlisted, reviewed 20 Swiss banks and financial service providers whose shares are traded on the SIX Swiss Exchange. The study, published on Thursday, October 22, 2026, incorporates half-year results and other company-specific developments. While the study brings no changes to the existing categories of overweight top picks, neutral, and underweight ratings, it updates the sector's operating environment and incorporates recent financial reporting.
The timing aligns with the reporting cycle, as most covered financial institutions report detailed results semi-annually, ahead of third-quarter figures from UBS. Analysts Ausano Cajrati Crivelli and Daniel Regli examined three macro factors shaping the industry. On interest rates, the Swiss National Bank's zero-interest policy continues to weigh on domestic banks, though results from the first half of the year show this impact remains manageable. A slightly steeper yield curve and robust equity markets provide positive momentum, alongside potential upside from any future Swiss key interest rate hikes. Regarding the broader economy, the Swiss economy displays resilience despite geopolitical tensions, higher energy prices, and trade conflicts, with clear positive growth expected for 2026 and 2027. On regulation, stricter capital requirements for UBS desired by the Council of States could limit its capital flexibility and competitiveness, creating a favorable side effect that relatively strengthens the competitive positioning of domestically focused banks.
The research recommends overweighting seven financial institutions as sector top picks, ranked by market capitalization. For Partners Group, the study deems the share price correction related to negative news on gating and slower growth in evergreen funds as exaggerated, projecting continued growth in assets under management despite temporary softening in high-net-worth private client demand. At Julius Bär, analysts see the conclusion of the FINMA investigation marking the start of a new chapter where the bank can refocus on normal operations, anticipating improved sentiment among investors and staff alongside a gradual reacceleration of net new money efforts and attractive shareholder returns through buybacks and dividends. For VZ Holding, fears that artificial intelligence could disrupt the business model are viewed as overdone, with AI potentially offering opportunities for service expansion and margin improvement, supported by strong growth in advisory mandates and a new branch in Berlin. Swissquote benefits from expanding client and asset bases with low market shares in Switzerland and Europe, while margins draw strength from improved rate prospects, higher volatility driving client activity, and diversified income from the Yuh online banking venture.
Additional overweight picks include EFG, noted for transitioning into a prominent private banking brand with attractive net new money growth, efficiency gains, and improved return on equity following completed cost programs and resolved legal disputes. St. Galler Kantonalbank is highlighted for resilience, stability, growing wealth management activities, a solid earnings profile, and an attractive dividend profile. Banque Cantonale de Genève offers growth potential from wealth management expansion, a diversified credit portfolio, and a valuation gap relative to peers despite above-average return on equity.
Half of the covered financial institutions fall into the neutral category. This group includes three cantonal banks representing Vaud, Lucerne, and Thurgau, alongside UBS, CFT, Cembra Money Bank, Leonteq, Liechtensteinische Landesbank, Valiant, and VP Bank.
Three institutions receive underweight ratings: Graubündner Kantonalbank, Glarner Kantonalbank, and Vontobel. Glarner Kantonalbank faces structural challenges as a mortgage-focused bank with fintech attributes due to small scale and low efficiency. Graubündner Kantonalbank faces high valuation and an asymmetric, downside-skewed risk-reward profile, alongside a pending lawsuit filed by Remo Stoffel involving a disputed amount of 400 million to 600 million francs. At Vontobel, the asset management division continues to suffer from outflows, and analysts identify potential for improvement in cost management.
