Private Banking Switzerland

Market Update July 2019

PwC’s Market Update on the Swiss Private Banking Sector 2019

The year 2018 proved to be challenging for Swiss private banks. The global equity market downturn in Q4 led to a significant decline in assets under management and profits. Swiss private banks reported a median return on equity of 4%, significantly lower than the sector’s average cost of capital. Only 20% of banks achieved a return on equity of 10% or more in 2018. Small private banks in particular are struggling, clearly illustrated by a cost/income ratio of over 100% for the first time in our records (median).

Maintaining momentum: seven deals in 2018

Announced Target Stake Buyer Seller Purchase price AuM

May 18

Notenstein La Roche Privatbank AG

100.0%

Vontobel Holding AG

Raiffeisen Schweiz

CHF 700m

CHF 16.5bn

Jul 18

MM Mourgue D'Algue & Cie

100.0%

Gonet & Cie, Banquiers privés

Private individuals

n/a

CHF 1.0bn

Jul 18

Schroder & Co Bank AG (Eastern European Portfolio)

Asset deal

CBH Compagnie Bancaire Helvétique SA

Schroder & Co. Bank AG

n/a

CHF 0.7bn

Sep 18

Banque Paris Bertrand Sturdza SA

40.0%

Investcorp

Private individuals

n/a

CHF 5.3bn

Sep 18

Berenberg Bank (Schweiz) AG

80.1%

Private individuals

Joh. Berenberg, Gossler & Co. KG

n/a

CHF 6.8bn

Oct 18

Lombard Odier (US Portfolio)

Asset deal

Vontobel Holding AG

Lombard Odier

n/a

CHF 0.6bn

Nov 18

Sallfort Privatbank AG

100.0%

Banque Heritage S.A.

Private individuals

n/a

CHF 1.13bn

Largest decline in AuM since the financial crisis

The 2018 stock market downturn resulted in the largest decline in assets under management since 2008. However, considering the rapid recovery of the market in early 2019, we expect many private banks to have quickly compensated these losses.

Small private banks in the centre of the storm

For the first time, the majority of small private banks (those with less than CHF 2bn in assets under management) are reporting an operating loss, indicated by a cost/income ratio of above 100% for this sector. Compared to mid- and large-sized private banks, smaller players seem to often lack the size to operate profitably.

“2018 has been a tough year for most Swiss private banks. Consolidation has remained relatively high, especially amongst small players. We expect this trend to continue in the near future.”

Martin Schilling, Director, Deals Financial Services, PwC Switzerland

About this Market Update

  • 83

    private banks in 2018

  • 88%

    market coverage

  • 14

    years of data

  • 75

    KPIs

Contact us

Christoph Baertz

Partner, Deals Financial Services, PwC Switzerland

Tel: +41 58 792 14 18

Martin Schilling

Director Deals Financial Services, PwC Switzerland

Tel: +41 58 792 15 31