Foreign lenders eye Swiss market post UBS-Credit Suisse deal
As Credit Suisse fades into history following its takeover by UBS, global banks are expanding their presence in Switzerland to seize opportunities in the wake of the former banking giant’s collapse.
France’s BNP Paribas, Germany’s Deutsche Bank, and US lenders Citi and Bank of America are among the major players increasing their staffing and courting Swiss companies.
Credit Suisse, long a dominant force in Swiss banking alongside UBS, was the go-to partner for many local businesses. However, its downfall has prompted companies to seek new banking partners, wary of overdependence on UBS, which has become the largest bank in Switzerland.
This shift has created openings for foreign banks to gain market share and alleviate concerns about a lack of competition, as highlighted by the Swiss competition watchdog COMCO.
Citi is expanding its commercial banking team in Switzerland from eight to 16 by 2028, focusing on smaller local firms with international operations. Jürg Hobi, head of Citi’s Swiss commercial banking, noted a surge in demand for alternative banking options following Credit Suisse’s collapse.
BNP Paribas, with around 50 corporate and investment banking staff in Switzerland, including 12 former Credit Suisse employees, aims to support smaller exporters and move into share buybacks. Enna Pariset, head of BNP’s Swiss operations, emphasized that the bank is now the second largest in the Swiss franc-denominated bond market.
Deutsche Bank has also expanded its Swiss corporate banking team by 10 per cent in 2023, now totaling 50 employees. Veronique Voser, head of Deutsche Bank’s unit for Germany, Switzerland, and Austria, mentioned the bank’s double-digit revenue growth in 2022 and 2023 as evidence of their success in winning new business and increasing volumes with existing clients.
Despite the influx of foreign banks, UBS remains a formidable competitor. Smaller firms, in particular, have expressed concerns over the lack of alternatives to UBS, especially in loan financing. BNP Paribas’s Pariset noted instances where clients have turned to them after competitors raised prices.
Swiss financial regulator FINMA recently stated that the UBS-Credit Suisse takeover did not pose significant competition issues, although COMCO has called for a deeper review to foster effective competition.
Brooke Wachtel, Bank of America’s head of corporate banking in Switzerland, emphasised that the window of opportunity for new banking relationships is closing, with companies expected to finalise their new partnerships within the next 12 to 18 months.
