Banking Barometer 2025: Switzerland confirms its position as the world's leading location for cross-border asset management  

Mr. Hess, today sees the publication of the Banking Barometer and the Swiss Banking Outlook. Can you briefly explain what these publications do? 

Martin Hess: I'd be happy to. The Banking Barometer analyzes developments over the past year and the first half of the current year, based on figures from the Swiss National Bank and surveys of our member institutions. The report explains and classifies the most important key figures on business performance, balance sheets, asset management, and employment from an industry perspective. The Swiss Banking Outlook supplements this review with an assessment of future developments. It is based on a survey of chief economists and chief investment officers at our member institutions. Together, these two publications have provided a comprehensive picture of the situation and prospects for banks in Switzerland for many years.

The Banking Barometer shows a 3.5 percent decline in aggregate business performance for 2024. What led to this? 

The decisive factor was the significant decline in interest income. Interest margins came under pressure because refinancing costs rose while mortgage interest rates fell. At the same time, banks in Switzerland posted strong results in trading, which partially offset the decline in interest income. In a highly volatile global environment, customer demand for hedging services rose sharply. Commission and service business also increased slightly. Overall, however, it is clear that dependence on interest income represented a major challenge for many institutions.

The picture is different for asset management. 

Yes, Swiss banks achieved record levels in this area: assets under management rose by over 10% in 2024 to more than CHF 9,200 billion. It is particularly noteworthy that Switzerland has confirmed its position as the world's leading location for cross-border asset management for private clients. Especially in times of geopolitical uncertainty, investors are looking for stability – and they find it here thanks to a robust political system and strong institutions.

How have employment and jobs developed? 

Domestic employment rose slightly in 2024. At the end of the year, a good 94,000 people were working full-time equivalents at banks in Switzerland. This is a welcome and somewhat surprising increase of over 1,000 jobs in the first year after the collapse of Credit Suisse. The outlook is also particularly encouraging: 96 percent of the institutions surveyed expect employment to remain stable or increase in 2025. This is the highest figure in ten years and a clear sign of the industry's importance as an employer. However, the success of digitally savvy banks also shows that those who want to remain competitive must keep personnel costs under control.

What are the expectations of the Swiss Banking Outlook for 2025? 

Overall, experts anticipate a modest development in business performance. The interest rate environment remains challenging, and the vast majority of respondents expect the Swiss National Bank to maintain its zero interest rate policy. Credit growth is viewed positively, especially for mortgages. We also expect inflows into Switzerland to continue in the area of cross-border asset management. Political stability, legal certainty, and a strong currency are key location factors that will continue to inspire confidence in the future.

What does this mean for the Swiss financial center as a whole? 

Despite challenges, the financial center is proving resilient. Record levels of assets under management, stable employment prospects, and Switzerland's role as a safe haven demonstrate its strength. It remains crucial that we preserve these locational advantages while not weakening competitiveness through excessive regulation, which is considered one of the top risks.