GENEVA (Reuters) – Swiss banks should shift extra operations to the European Union if Switzerland fails to safe a treaty with the buying and selling bloc, Geneva personal bankers mentioned on Tuesday.
After 4 years of talks, a deal defining Switzerland’s relationship with the EU stays in limbo, with issues about preserving Swiss sovereignty holding up a decision to the nation’s greatest overseas coverage concern.
Geneva Monetary Heart, representing 104 banks, mentioned that reviving the stalled treaty was a “vital precondition for negotiations on a future settlement that will give Swiss banks and monetary intermediaries free entry to EU markets”.
“Failing that, they are going to be compelled both to relocate or to develop a few of their actions within the EU, adversely impacting jobs and tax revenues in Switzerland at each nationwide and native stage,” Yves Mirabaud, president of the group and chairman of Mirabaud & Cie SA, instructed a information convention.
Brussels has mentioned the Swiss will get no elevated entry to the one market till the treaty, which might see Switzerland routinely undertake single market guidelines, is settled.
The Heart urged the Swiss authorities to ship a “robust sign” backing a deal after the parliamentary election on Oct. 20.
Requested whether or not he feared banks would possibly go away if there have been no deal, Mirabaud mentioned: “What I concern is just not that they go away the monetary heart, however that they pursue their progress outdoors of Switzerland – particularly as we’ve seen in Luxembourg or different European facilities.”
The banking sector employs 35,600 folks in Geneva and contributes 12% of the canton’s economic system, in line with the group.
Almost half of the belongings managed in Switzerland, nonetheless the world’s largest monetary heart for cross-border personal wealth administration, come from overseas, together with some 1 trillion Swiss francs ($1.01 trillion) from the EU, it mentioned.
Edouard Cuendet, the Heart’s managing director, mentioned Switzerland was “nonetheless primary” in cross-border administration, although he mentioned market share had dipped for the reason that automated alternate of shopper data with tax authorities got here into drive.
“Most institutions count on subsequent 12 months to be tougher than 2019,” Cuendet mentioned, citing uncertainty and strain on margins.
Geneva bankers are additionally “on edge with regard to the dangers generated by unfavourable charges, which look to be right here to remain,” Mirabaud mentioned.
The Swiss Nationwide Financial institution’s (SNB) unfavourable rates of interest had been driving buyers to “over-allocate” to sure asset courses equivalent to actual property and have additionally hit pension funds, he added.
Reporting by Stephanie Nebehay; Modifying by Jan Harvey