GENEVA (AFP) – Switzerland’s banking sector, facing the end of the secrecy that was once the bedrock of its business, is turning to China as it seeks new markets for the future.
“One of the first ports that the Swiss financial centre is steering for… is the port of China,” Claude-Alain Margelisch, chief executive of the Swiss Bankers Association, told reporters in Geneva this week.
“Together with our member banks, we want to make Switzerland an international hub for the renminbi,” also known as the yuan.
Switzerland will abandon its long-prized banking secrecy in 2017 when it starts automatically exchanging account details with other countries, and with it goes one of the main attractions of placing money in its banks.
For generations, investors have paid Swiss banks high fees to hide their money from tax authorities around the world, providing a lucrative stream of revenue for them.
But the global financial crisis prompted demands for a tougher regulatory environment. Switzerland was reluctantly forced to accept the new rules, leaving the banks facing an uncertain future.
Not only are private Swiss banks looking for new sources of revenue, but they have also faced probes and massive fines from countries accusing them of abetting tax dodging.
“The Swiss financial centre and the Swiss banks have recognised the need for action,” said Margelisch.
“We have drawn the necessary conclusions from previous mistakes and introduced counter-measures.”