This Is the Bank Share of the Decade

This Is the Bank Share of the Decade

With the end of a decade looming large, the question arises, which of the Swiss bank shares performed the best. The analysis conducted by finews.com revealed some surprising results.

How lucrative is it for investors to bet on Swiss bank stock? After the turbulent 2018, the year proved very positive on average – but how did the banks do? After last year’s disappointment, the investors will be more happy with some of the bank stocks in 2019.

Looking at the stocks from the point of view of a long-term investor, the analysis also shows how well banks did on average.

Almost 280 Percent Growth

The Swiss Market Index (SMI), which includes listed companies with the highest valuations in Switzerland, increased 59.7 percent from January 1, 2010 through December 12, 2019. Only five of the 27 banks that finews.com looked into managed to beat the index. For a more precise comparison, one would actually have to look at the Swiss Performance Index (SPI). But with a performance of 124.5 percent over ten years, the banks fared even worse by comparison.

Top of the table (see below) came VZ Holding, which easily beat off the competition – adding a whopping 279.4 percent over the course of ten years. Second in line was Cembra Money Bank, which almost doubled its value (plus 99.8 percent) since going public in 2013.

On third place comes Banque Cantonale de Vaudoise, the best-performing cantonal bank, with a jump of 95.1 percent. Switzerland’s largest private bank, Julius Baer, also did well, adding 28 percent in the decade – the Zurich-based bank in April incidentally was kicked out of the SMI.

A Drop by Three Quarters

The worst performer by a distance was Credit Suisse, Switzerland’s second-largest bank. The value of the share dropped by 75 percent. It started out at a price of 51.10 Swiss francs ($52.10) per share and fell to 12.75 francs by December 12. It needs to be said that the bank had diluted the shares by a number of capital increases over the years.

The biggest bank, UBS, didn’t do that much better. The price may have declined by 26.5 percent only, but the bank hasn’t diluted its stock.
The second-worst performance was that of EFG International. The stock fell 55.9 percent over ten years. Valiant, the Bern-based regional bank, declined 53.6 percent.