Swiss financial centre

Transcription

1 Financial System & Financial Markets Swiss financial centre Key figures October 2018 EFD State Secretariat for International Finance SIF

2 1 Basic elements Over the past ten years Switzerland s gross domestic product (GDP) has risen, whereas the absolute contribution of the financial centre to added value has fallen. Both developments together result in a lower share of GDP for the financial centre. Table 1 Added value, in CHF mn Financial services Insurance services Financial centre total in % of GDP Gross domestic product (GDP) Switzerland Data: Federal Statistical Office (FSO) / State Secretariat for Economic Affairs (SECO), annual aggregates of GDP, production approach (annual data). Figure 1 Financial centre s share of GDP (2017) The proportion of GDP from the financial centre shows its relative contribution to national added value. The size and sector structure of an economy can influence the extent of production by the financial sector in % Germany Luxembourg Switzerland Singapore UK USA Data: German Federal Statistical Office, Statistics Portal Grand Duchy of Luxembourg, FSO/SECO (Switzerland), Singapore Department of Statistics, Office for National Statistics (UK), Bureau of Economic Analysis (USA).

3 Over the last decade, employment grew only outside the core area of the financial centre. The decline in the traditional financial services sector is clearly visible. Table 2 Employees, in full-time equivalents Financial services Insurance services Activities auxiliary to financial services and insurance activities Financial centre total in % of overall employment Overall employment Data: FSO, Job Statistics (values for Q4 or Q2 2018). The financial centre makes a contribution to the receipts of the public sector. This results both from taxes on workers incomes and from taxes on employers revenue. Table 3 Taxes, in CHF mn Individuals Companies Banks Insurers Financial centre total In % of direct overall tax revenue Taxes on income and assets Confederation, cantons and communes Data: SNB, FINMA, FFA, FTA (annual data).

4 2 Global integration The current account surplus goes hand in hand with a rise in net foreign assets, whereby receivables in relation to foreign countries increase. The financial sector contributes to the creditor position. Table 4 Net exports, in CHF bn Financial services Export receipts Import expenditure Insurance services Export receipts Import expenditure Financial centre total in % of Switzerland s current account surplus Current account surplus Data: (SNB data portal; annual data). Direct investments are a possible indicator of globalisation and represent a dynamic form of the international division of labour. The close ties between economies contribute to a strengthening of human cohesion. Table 5 Direct investments abroad, in CHF bn Capital stock of banks Capital stock of insurers Financial centre total in % of total capital stock abroad Total capital stock abroad Data: (SNB data portal; year-end values).

5 Figure 2 Bank receivables from other banks ( ) Compared with domestic transactions, cross-border interbank transactions posted very dynamic growth. The deleveraging by banks in the Swiss financial centre vis-à-vis banks abroad that took place after the outbreak of the global financial crisis of 2008 is clearly visible. 900 In CHF bn Cross-border interbank transactions Domestic interbank transactions (SNB data portal; year-end values or those for the end of June 2018).

6 3 Banks and credit market Banking regulation following the global financial crisis has doubled the number of big banks. An economic structural change is also evident in the decline of over a third in banks under foreign control. The number of private bankers has even been more than halved. Table 6 Number of banks Cantonal banks Big banks Regional banks and saving banks Raiffeisen banks Stock exchange banks Foreign-controlled banks Branches of foreign banks Private bankers Other banks Total Systemically important banks 2 5 Data: (SNB data portal; year-end values).

7 The financial sector and the real economy are interconnected through bank lending. The credit volume in relation to GDP is a measure of systemic risk in the international Basel III framework. Table 7 Credit volumes, in CHF bn Domestic borrowers of which mortgage borrowers Foreign borrowers of which mortgage borrowers Total Data: (SNB data portal; year-end values or those for the end of June 2018). Securities holdings in client bank accounts are an indicator of the assets managed in Switzerland s financial centre. Table 8 Securities holdings, in CHF bn Swiss custody account holders private customers commercial customers institutional investors Foreign custody account holders private customers commercial customers institutional investors Total Data: (SNB data portal; year-end values or those for the end of June 2018).

8 Figure 3 Shares per bank group in the balance sheet total (2017) Although there are 253 banking institutions in Switzerland, the four big bank institutions account for almost half of the entire balance sheet total. The degree of consolidation may indicate a possible restriction of competition. 3% 0% 7% 6% 18% Bank groups: Cantonal banks Big banks 7% 7% 4% 48% Regional banks and savings banks Raiffeisen banks Stock exchange banks Foreign-controlled banks Branches of foreign banks Private bankers Balance sheet total for all banks: CHF billion Other banks Data: (SNB data portal; year-end values).

9 4 Insurers and occupational benefits schemes Consolidation can be observed not only in the banking sector, but also among insurers. This is mainly due to a decrease in the number of captives and health insurance funds with supplementary insurance business. Table 9 Number of insurers Life insurers domiciled in Switzerland branches of foreign insurers Non-life insurers domiciled in Switzerland branches of foreign insurers Reinsurers of which captives Health insurance funds with supplementary health insurance business Total Data: FINMA, Report on the insurance market direct insurers (year-end values). The rising numbers of members in active employment and pension claimants are spread across fewer and fewer occupational benefits schemes. Table 10 Number of occupational benefits schemes, members and benefit claimants Occupational benefits schemes Members in active employment Current pension claimants Data: (STAT-TAB interactive FSO database; year-end values).

10 Despite low interest rates, fixed-interest securities have accounted for almost half of all capital investments in the past decade. Table 11 Capital investments of insurers, in CHF bn Land, buildings Mortgages Financial interests Shares, bonds and investment funds Fixed-interest securities Loans, debt register claims Other investments Total capital investments Data: FINMA, capital investments of all insurers (year-end values). Over the past ten years, collective assets have become more important in the capital allocation of pension funds. Table 12 Capital investments of occupational benefits schemes, in CHF bn Cash and cash equivalents Bonds Mortgages Shares Real estate and land Alternative investments Other investments Total capital investments of which collective assets Data: (STAT-TAB interactive FSO database; year-end values).

11 5 Stock exchange and capital market Figure 4 Equity market ( ) The low interest rate environment in recent years has made stock market investments more attractive in relative terms. With the exception of banks, many sectors have recorded positive developments in their basket of shares since the global financial crisis * Swiss Performance Index (SPI) Banks Health care Insurers Food and beverages * Up to end of July 2018 Data: (SNB data portal; own indexing based on end-of-month values).

12 Developments on the primary market, i.e. bond issuance, are determined by the (re)financing needs of companies and governments. The absolute financing costs (interest rates) are also important. Their level relative to other capital markets in the various currency areas likewise plays a role. Table 13 Net issuing value of bonds, in CHF bn Domestic borrowers Issues Redemptions Foreign borrowers Issues Redemptions Financial centre total Data: (SNB data portal; year-end values or those for the end of June 2018) The secondary market, i.e. securities trading, is dominated by domestic shares. Table 14 Securities turnover, in CHF bn Domestic securities Shares Bonds Foreign securities Shares Bonds Domestic and foreign investment funds, options and structured products Financial centre total Data: (SNB data portal; year-end values or those for the end of July 2018).

13 Figure 5 Collective capital investments: number and domicile (2018) Total: Luxembourg Ireland 278 France 174 Liechtenstein 394 Other Switzerland Data: FINMA (values for end of Q1). The most widespread in Switzerland are collective investments from Luxembourg (market share of over 50%) and from Ireland and Switzerland (market share of almost 20% each). Two thirds of Swiss investments are in shares and bonds (see below). 5% 14% Investment category: Shares Bond issues 2% 13% 38% Money market in CHF Money market in foreign currencies Asset allocations 1% 27% Real estates Miscellaneous Data: (SNB data portal; values for end of Q1).

14 Imprint This report is published on a semi-annual basis in the three official languages of French, German and Italian, as well as in English and Chinese. As a guide, it provides fundamental values for analysing Switzerland as a location for financial services using official key figures. Rounding differences appear in a few calculations. This publication is also available online at Explanations In addition to the publication, you can download statistical and economic history explanations on This document contains information on data collection and an insight into the history of the Swiss financial centre. Translation English, French, Italian: FDF Central Language Services, Bern BE Chinese: Grueber AG, Zurich ZH Layout and printing Federal Office for Buildings and Logistics FOBL, Bern BE Sonderegger Publish AG, Weinfelden TG Orders Art. no /18E Contact FDF/SIF Financial System & Financial Markets Daniel Schmuki Bundesgasse Bern fin@sif.admin.ch Tel: FSC-Logo einfügen / ; This issue was completed on 13 September 2018.