Mainstay of the Swiss economy
Paradeplatz in Zurich: iconic heartland of the Swiss financial centre and home to some of the country’s most renowned banking institutions.© swissworld.org
When you mention Switzerland, most people automatically think of mountains and cheese, with banks coming a close third. This is not surprising given that the Swiss financial centre is a central pillar of the Swiss economy, generating over 11% of Swiss GDP. At the end of 2009, some 199,000 people (full-time equivalents) – or 6% of Switzerland’s total working population – were directly employed by banks, insurance companies and other financial institutions.
The term “financial centre” generally refers to major cities like New York and London, which have a dense network of banks, financial companies, stock exchanges, insurance companies and international trading firms. Either these centres boast a high concentration of myriad financial services or they specialise in specific areas of the industry. Switzerland’s financial centre has three main hubs - Zurich, Geneva and Lugano.
Players and services
The key players in the Swiss financial centre are the banks. One of their core businesses is asset management. The volume of assets under management in Switzerland is CHF 11,300 bn – practically 10% of worldwide assets under management –making it the third-largest financial market after the US, with CHF 49,200 bn, and the UK, with CHF 13,400 bn. However, in terms of cross-border private wealth management, Switzerland takes the lead with CHF 2,300 bn, which equates to a market share of 27% (cf. table below).
The second most important players are insurers. Close to 70% of their global premium income is generated overseas, indicating a high degree of internationalisation. Swiss insurance companies have increasingly specialised in re-insurance, i.e. where an insurer insures other insurers, making Switzerland the fourth largest re-insurer in the world.
The Swiss financial centre is also a major international force in currency trading, commodity trading and the management of funds of hedge funds. However, in other financial services, such as the funds business, institutional asset management, investment banking, as well as commerce and corporate banking, it continues to play only a minor role.
International comparison
Switzerland is a relatively small country in terms of population, but it is an international heavyweight when it comes to financial services.
The table below provides an overview of the largest asset managers worldwide.
Share of assets under management in international private banking, end of 2007
| Source: Boston Consulting Group, 2007 | |
| Switzerland | 27% |
| United Kingdom | 24% |
| Luxemburg | 14% |
| Caribbean | 12% |
| Singapore | 7% |
| United States | 7% |
| Hong Kong | 3% |
| Others | 6% |
Links to other websites
- Figures on Switzerland as a location for financial services Federal Department of Finance
- New financial market policy strategy Federal Department of Finance
- Swiss financial centre Swiss Bankers Association