The majority of Swiss wealth managers are upbeat about their prospects. However, worries over everything from blockchain to collapsing margins are on the rise.
Banks in Switzerland don't have it easy: negative interest rates are eating into their profits, the Swiss housing market is in a froth, and digitization threatens to wipe out entire business areas once dominated by financial institutions. What else?
Consulting firm EY compiled a selection of worries and angsts among 100 top executives at Swiss regional, cantonal, and private banks as well as foreign lenders in Switzerland in its«Bankenbarometer 2019» (in German):
1. Housing Market
Seventy-six percent of the banks queried said the house-building boom and frothy rental prices pose a substantial risk for Switzerland's real estate market, compared to 71 percent last year.
The investment worry as well as a considerable vacancy rate likely worries more banks this year than last. If interest rates do tighten interest rates from historic negative levels, many new homebuyers will be caught unawares – which will ultimately hit banks.
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