Swiss private banks expect merger activity
A merger boom in on the cards in the Swiss private banking sector, to judge by a survey published by adviser KPMG, where nearly 80% of respondents expect consolidation.
Only 14% of the 30 leading Swiss private banks surveyed said current profitability and gross margins are sustainable. Forty per cent say that clients are pressing for fee reductions. Around 96% believe clients prefer transaparent and simple products.
Nearly three-quarters of respondents believe the Swiss private banking industry must transform itself in order to overcome the challenges it faces. They see limits to growth in Switzerland, but see a brighter future for cross-border activities.
Less than a third believe Swiss domestic private banking will grow over the next three years, though more than half believe the industry will experience growth outside Switzerland.
Almost 90% expect intensifying competition. This brings the need for transformation even closer to home, according to the survey.
Current challenges will lead to greater consolidation, according to 79% of respondents. More than two-thirds believe there are good M&A opportunities and that valuations are attractive.
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