Swiss Private Banking Shifts Towards Smaller Players

Tax-news.com

07 February 2000

Switzerland's biggest private bank UBS continued to lose market share to smaller, more aggressive competitors last year. UBS had originally set out to double its funds under management within five years after it merged with Swiss Bank Corporation 18 months ago, but poor performance in its private banking business has caused UBS to abandon this target.

Stepping in to fill this void were Switzerland's two biggest quoted private banks - Julius Baer and Vontobel, both of whom matched UBS last year with more than one third growth in funds under management. However, despite comparable growth figures, the profits performance of UBS's competitors was not so consistent.

Julius Baer increased its non-global custody funds by 35% to SFr 128 billion last year, but reported only a 6% rise in its dividend to shareholders due to increased taxes and operating costs. Vontobel, on the other hand doubled its dividend last year based on a 30% rise in funds to SFr 71.1billion.

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