Crisis seems to be everywhere right now, except in sunny, old-fashioned Switzerland. The stoic nonchalance of the Swiss seems to be proving its worth another time, says Fabian Käslin in a piece for finews.first.
This article is published on finews.first, a forum for authors specializing in economic and financial topics.
Anyone hiking through Switzerland right now, for example, in my home in Etzel near Zurich, will find lush fields, meadows, and pristine lakes. Beaming smiles fill the air, probably because of the weather and as it is summer vacation. Everyone says hello and stays to have a drink at the local restaurant while the occasional eBike flits by.
The world is in order. Far away from inflation, stagflation, recession, euro-crisis, Ukraine crisis, energy crisis, and, and, and… It looks like the stoic nonchalance of the Swiss is paying off once again as crisis seems to be everywhere except in old-fashioned Switzerland.
«It is these values that must be kept, even treasured, notwithstanding whatever else is going on in the world»
The picture seems to be the same in Zurich’s Paradeplatz, the central point in the country’s banking hub. Many have predicted the industry’s demise in some form or another at some point. Right now, it is the independent asset managers who are collectively about to commit some form of mass suicide even though Switzerland remains the leader in cross-border wealth management.
The number of embattled major banks right now is exactly one. What they are going through is likely due to a toxic corporate culture and a non-existent value proposition. It is probably not symptomatic of an ailing finance sector.
Banks, as the country, change constantly. But a stable foundation is there to support them. Both citizens and the wealth management industry are based on strong traditions and values, from the first oath marking the foundation of our confederacy to the contemporary finance center in Paradeplatz. It is these values that must be kept, even treasured, notwithstanding whatever else is going on in the world.
«African despots and Latin American tax evaders no longer send money to Switzerland»
Dependability, stability, quality, punctuality, modesty, independence, community, federalism, neutrality, and direct democracy. They still exert influence internationally even if we sometimes don’t think that is the case anymore. The inflows of net new money from strongly positioned private banks and wealth managers in the crisis years of 2020, 2021, and 2022 show that our values and traditions are recognized worldwide.
African despots and Latin American tax evaders no longer send money to Switzerland. Now it is entrepreneurs and wealthy families from those very same continents. They appreciate the country’s stability and quality in an unstable world barren of any kind of adequate service.
Stability, dependability, neutrality, and security go hand in hand. Outside Switzerland, that is no longer recognized as a matter of course, or it never was. That does not mean that the country just profits from crises but that it benefits from its tradition and values – a small, but decisive difference.
«We whisper quietly and give advice and we don’t say, loudly, that we know better»
Successful Swiss private bankers and wealth managers combine tradition and values with client needs without unduly ingratiating themselves or being too easily interchangeable. We look at things like ESG and help our clients pay heed to sustainable criteria in their wealth planning. But we don’t throw everything by the wayside and think that we can lecture clients or get banks to save the planet singlehandedly. We whisper quietly and give advice and we don’t say, loudly, that we know better. We don’t run with short-term trends but keep our eye on the long-term and stability.
In times where politicians put more emphasis on what plays best on Instagram or the next Tweet, there seems to be a growing tendency to throw everything set in stone overboard without realizing the long-term implications.
«It is little wonder that any prudent entrepreneur seeks security and advice for their assets»
That is when social conflicts increase. When little more than shit storms bring individuals down – when the principle of innocence before being proved guilty in a court of law seems to come across as old-fashioned, even sluggish. Questionable morals, even ethics, seem to void the very laws of physics, raising the potential for a wider, global crisis. In the best case, they are just economic ones. In the worst, they turn into armed conflict
It is little wonder that any prudent entrepreneur seeks security and advice for their assets. Switzerland, and the finance hub, remain as solid as a rock in the treacherous global waters. Our small, limited geographic size, our knowledge and understanding of diverse languages, and our lack of natural resources have always forced us to be cosmopolitan, and open, to have common sense and a strong work ethic - while remaining skeptical about any form of megalomania.
«That is why it makes no sense to replace our values and traditions with short-term social trends»
Clients still appreciate this and even admire it. Comprehensive wealth management is uniquely Swiss and requires care, discipline, and empathy, something that many other banks have lost. It may be the small difference between the old-fashioned Swiss banker and the modern Anglo-Saxon banker.
That is why it makes no sense to replace our values and traditions with short-term social trends. Swiss finance, as the country, embodies longevity, modesty, and healthy common sense. If this is seen as being old-fashioned and boring, then I am happy to be so. And I won’t even be modest about it, but even a little proud.
Happy birthday, dear Switzerland!
Fabian Käslin is CFO and COO of BIL Suisse, the Swiss subsidiary of the oldest bank in Luxembourg, Banque International à Luxembourg (BIL). Previous to that, he was a strategic advisor for China-based investment company Legend Holdings, a major BIL shareholder. His career started with UBS Switzerland in 2009. Between 2012 and 2019, he worked for Julius Baer in several global positions. He started as a client advisor and left the bank as Deputy COO International. He has an MBA from Edinburgh Business School and is a guest lecturer at various universities.
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