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Swiss banks aren't finished consolidating, according to the new head of foreign banks in Switzerland. Citi banker Kristine Braden also tells finews.com where banks are creating new jobs. 

Kristine Braden, you’re governing an organization whose membership has shrunk in recent years. For whom is the financial center still attractive?

Switzerland remains an attractive financial market for many foreign banks. There are over 115 active foreign banks here and the AFBS (Association for Foreign Banks in Switzerland) remains the largest banking association in Switzerland. We often think foreign banks are purely focused on private banking, but our members are far more diverse than that, representing all facets of Swiss banking from retail and private banking to corporate banking and trade finance.

We need to think about Swiss banking in its entirety, not just one dimension. For the non-private banking side of the business, we continue to see growth due to the strength of the Swiss economy and the fact that Switzerland remains very attractive for multinational corporates and treasury centers. 

Foreign banks have been a big factor in the drop of finance jobs in Switzerland. Do you see the industry turning the corner on job losses?

We have seen three trends in the past several years. The first is private banks exiting the market especially where their owners abroad strategically repositioned their Swiss footprint in the wake of the financial crisis. The second is consolidation among banks to achieve scale due to heightened cost and regulatory pressures, which is affecting the wider industry both in Switzerland and abroad.

«We see a reorganization of the banking value chain»

My view is these trends are healthy and a normal part of industry development. As both 2017 and 2018 are strong years, we are seeing these trends abate. Lastly, we do see a reorganization of the banking value chain driven by digitization and operational efficiency, often to third parties. In this case jobs often reappear in the IT or outsourcing sectors through providers like Avaloq or Temenos.

What types of restructuring or shifts do you expect the AFBS’ member banks to still be making in the coming 12 months, or is that phase largely over?

There will continue to be some consolidation or exits among smaller banks but with Finma's «Kleinbank» program, some category 4 and 5 banks will hope to achieve some regulatory relief. This is a welcome development. In addition, our members continue to look at their operating models and the future impact of digitization on Swiss banking. Some of our members are increasingly active in cutting-edge banking solutions and see Switzerland as a very interesting location for new technologies.

Do you expect to attract new members, meaning new banks coming into Switzerland and if so, from where and why?

We have continued to welcome new members, more recently from Asia. In the past few months we have had new applications from banks, the most recent one being the Chinese bank ICBC. Two more Chinese players, Bank of China (BoC) and the Agricultural Bank of China (ABC), are preparing to start their activities in Geneva and we hope they will become members too. We welcome this new interest, which reflects the internationalization and development of financial flows to and from the Asian region. It also reinforces the strategic importance of Switzerland as a financial center in Europe.

What are the main concerns for the foreign banks right now?