Americans turn to Swiss banks, seek safe haven
Keystone-SDA
Americans are knocking more and more insistently on the doors of Swiss banks, although few institutions now cater to this type of clientele.
The attraction is Switzerland’s reputation as one of the most stable countries, with a prosperous economy and a tradition of neutrality, a sort of safe haven in the storm of Washington’s tariffs.
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Already in March, the Geneva-based private bank Pictet had noted an increase in demand from existing and new clients at its PNAA (Pictet North America Advisors) facility, which is registered with the SEC, the US financial regulator. “We have been observing the same trend since April,” a spokeswoman for the group confirmed to news agency AWP without providing numbers.
The observation is shared by Billy Obregon, managing director of Vontobel Swiss Financial Advisers (SFA). “In recent months we have seen increasing demand from our US clients who want to diversify their investment portfolios more”. Also attracting them is the “inherent stability” of the Swiss financial sector. “Rather than reacting to short-term market fluctuations, it is in investors’ interest to focus on long-term fundamentals and the lasting benefits of diversification.”
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According to the Vontobel Group’s half-yearly financial report, 52% of the bank’s assets come from abroad. As of June 30, North America contributed CHF18 billion out of a total of CHF 306 billion, not far behind the UK with CHF24 billion and Germany with CHF23 billion.
The Zurich-based bank also appointed a head of private clients for the Americas region, based in the US, to lead the next phase of expansion. “We have seen strong interest from US investors,” explains a press officer. “An interest that, in our view, should be maintained in the near future.” There are significant inflows in the private and institutional client segments.
There are few financial firms in Switzerland that cater to American clients. In addition to Pictet and Vontobel, UBS and Julius Bär are particularly noteworthy. The strict regulations imposed by the Foreign Account Tax Compliance Act (FATCA) since 2014, which oblige institutions to report Americans’ accounts, have led to administrative burdens, costs and legal risks, particularly after the sanctions imposed by the US.
According to the experts, however, one thing is clear: US President Donlad Trump’s policies are pushing investors towards reassuring and familiar financial centres such as. Singapore, London and Frankfurt. “The geopolitical and macroeconomic uncertainties lead one to remember the value of Swiss stability: the rule of law, institutions and the strength of the franc,” Ariane de Rothschild, managing director of Edmond de Rothschild banking, told AWP. The Swiss banking system retains great advantages: exceptional know-how, the result of a long banking tradition, but also an ecosystem of innovation in ESG (environmental, social and good governance criteria), fintech (more than 500 in Switzerland) and crypto-assets.
According to Martin Hess, economist at the Swiss Bankers Association (SBA), “geopolitical tensions have clouded the outlook and caused sharp fluctuations in exchange rates: in such an environment, security has become a much sought-after commodity”. For Switzerland, there are advantages. “The willingness of investors to pay a premium for safe assets leads to lower interest rates and thus lower investment costs for companies. Consumers, for their part, pay less for imported goods and thus have additional means for consumption or wealth building”.
Switzerland remains number one in most world rankings in wealth management. Of the CHF8,400 billion in assets managed by Swiss banks, 45% (CHF 3,800 billion) come from foreign clients, the SBA calculates. Swiss financial institutions manage more than 20% of the world’s cross-border private assets.
Adapted from Italian by DeepL/ac
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