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The difference in dynamic between Switzerland’s two largest banks becomes glaringly obvious in the way investors perceived their performance. The UBS share price has declined slightly over the course of the year, which makes the bank – together with Liechtensteinische Landesbank (LLB) – a clear underperformer. It is also the wealth-management giant’s biggest blemish.

One aspect, that makes the performance of the industry a slightly less benign reading, is the decline in profit at most banks – and that’s despite the share price surge at banks such as Julius Baer (plus 34 percent) or Vontobel (plus 26 percent). Both UBS, Julius Baer, Vontobel, as well as Geneva-based Pictet and Lombard Odier, and Liechtenstein’s LGT all reported a decline in profit. The 17 percent drop at Pictet in the first half was the most pronounced decline.

Signs of Life at EFG

All banks struggled with a persistent reluctance among wealth management clients to engage in deals – and almost all reacted with a tightening of the cost management. The cost-income ratio at almost all the banks finews.com looked into declined over the course of the year – with the exception of Julius Baer and Pictet, where the ratio jumped from 69 percent to 74 percent by the end of the first half.

EFG International showed clear signs of life this year, with a share price increase of 7 percent and a pretax surge of 36 percent in the first half. The cost-income ratio of 85.2 percent is, however, the worst among the banks in our survey. The ongoing integration of BSI clearly has some more potential for the bank to take advantage of.

The Liechtenstein Performers

VP Bank and LLB, two of the banks based in Liechtenstein, kept their costs under a tight reign. The companies both had relatively feeble growth rates and net new money performance. Still, VP Bank and LLB both increased their profit in the first half, which made them stand out in comparison with LGT. The bank of the principal family however attracted substantially more assets than its local rivals.