Switzerland is perhaps best known for its impactful financial industry. The country has cultivated a reputation as a global center for private wealth management and plays a pivotal role in shaping the financial services industry. While the trends in this sector echo global patterns, Switzerland adds its distinctive touch, creating a financial landscape that is both dynamic and robust. What has worked in the country’s favor is the embrace of sustainable investments. The government, along with the Swiss Financial Market Supervisory Authority (FINMA), is taking a closer look at the environmental, social and governance (ESG) aspects of financial activities. This scrutiny reflects a growing awareness of responsible investing and a commitment to aligning financial strategies with sustainable practices.
The implementation of the Federal Act on Financial Services (FinSA) and the Federal Act on Financial Institutions (FinIA) has been a transformative journey since January 1, 2020. These acts have a far-reaching impact on the market as they introduce relaxed rules for foreign investment schemes targeting qualified investors. Additionally, new licensing requirements for portfolio managers and collective asset managers are reshaping the regulatory landscape with an emphasis on transparency and accountability.
The monumental merger between Credit Suisse and UBS, announced in March 2023, has triggered significant regulatory responses. In a bid to ensure financial stability during and post-merger, FINMA has issued directives to Credit Suisse that mandate the complete write-down of its additional tier 1 instruments (AT1 bonds). This move shows Switzerland’s strategy to maintain a resilient and stable financial environment amid transformative industry shifts, which are coming in fast over the past five years.
As Switzerland navigates these trends and developments, its financial sector remains characterized by precision, reliability and adaptability. The commitment to sustainable practices, the evolving regulatory framework and the response to transformative events exemplify Switzerland's resilience and strategic foresight in the ever-changing global financial landscape.