Executive Summary

Annual profit depressed by reduced result from interest operations due to low interest rates The drop in the Swiss banks’ aggregate net income was primarily caused by a lower result from interest operations, itself due in particular to higher refinancing costs and the resulting increase in interest expense. The net interest margin of the domestically oriented banks contracted by 8% during the year to 1.02% at the end of 2024. This was offset by a marked rise of 38.4% in the result from trading activities, which stemmed first and foremost from the increased market volatility seen in 2024. The result from commission business and services also showed a small increase. The stock exchange banks and the cantonal banks increased their shares of net income, whereas the big banks saw their share fall as their net income recorded the sharpest decline of any category. The previously observed shift in importance from Switzerland’s big banks in favour of the other categories thus continued in 2024. The overarching trend towards fewer banks also remained in place. The net result of these developments was a 3.5% fall in aggregate net income. Annual profit was also lower in 2024, down 31.7% at CHF 17.7 bn. One reason for these developments was a decline in interest operations due to the reduced interest margin, which was significantly depressed as low interest on mortgages and bank loans was set against higher refinancing costs. Assets under management hit record level, mortgage loans still largest asset item Assets under management in Switzerland reached a record high in 2024, attesting once again to the country’s importance as a safe haven. The aggregate balance sheet total of all banks in Switzerland rose by 1.3% to CHF 3,219.1 bn. On the assets side, mortgage loans remained the most important item, making up 38.2% of the total, and showed a small increase. Amounts due from securities financing transactions and trading portfolios in securities and precious metals recorded much stronger growth, contributing significantly to the increase in the balance sheet total. Liquid assets, meanwhile, were down 12.9%, probably due to the big banks reducing excess liquidity. While amounts due from customers fell slightly in 2024, amounts due from domestic and foreign banks were higher. This reflects the banks’ changing liquidity needs in an environment of falling interest rates. Customer deposits higher, bonds and central mortgage institution loans sharply lower On the liabilities side, amounts due in respect of customer deposits increased. They make up more than half of all liabilities. Their rise is attributable to growth in both sight deposits (up 2.4%) and time deposits (up 4.8%). The uptrend in time deposits thus continued in 2024 in spite of the lower headline interest rate. Trading portfolio liabilities were CHF 3.9 bn or 13.8% higher. Bond issues, central mortgage institution loans and cash bonds, meanwhile, were CHF 62.2 bn or 15.5% lower. This may be due to the early redemption of Credit Suisse bonds by UBS and higher spreads on central mortgage institution loans. Amounts due to banks rose by CHF 15.2 bn or 3.9%, mainly as a result of an increase in amounts due to foreign banks. The Raiffeisen and cantonal banks were largely responsible for this trend. Number of staff at banks in Switzerland continuing to rise, outlook upbeat The employment situation at the 230 banks in Switzerland was stable in 2024, with the number of staff rising slightly. Out of approximately 159,500 full-time equivalents (FTEs) working in banking services, 94,347 were employed by banking institutions at the end of 2024. This equates to an increase of 1,048 FTEs or 1.1% year-on-year. The unemployment rate in the financial sector rose to 3.0%, minimally higher than the figure for the Swiss economy as a whole. In spite of the challenges posed by the changing interest rate environment, the Swiss banking sector continued to prove robust on the job front. The SBA survey reveals that the Swiss banks’ headcount fell by 1.7% in the first half of 2025, although this was entirely due to trends in other countries. Domestic headcount was stable in the same period. According to SECO, the unemployment rate in the financial sector dropped minimally compared with the end of 2024 to 2.9%. The results of the SBA survey show that the outlook for the rest of the year is optimistic. Only 4.0% of the banks surveyed expect their headcount to fall, whereas 96.0% expect it to remain constant or even rise.

Moderate growth and stabilisation in first half of 2025 The economic trend remained moderately positive in the first half of 2025. The Swiss Banking Outlook predicts GDP growth of 1.2% for the year as a whole. Inflation was still low, and the SNB cut its policy rate to 0%. The aggregate balance sheet total of the banks in Switzerland remained stable, falling by just 0.2% to CHF 3,323.3 bn. Increases in mortgage loans, financial investments and liquid assets were set against slight decreases in the other asset items. Trading portfolios in securities and precious metals fell particularly sharply, ending their strong positive trend from 2024. Despite a small drop of 0.6%, assets under management remain very high at CHF 9,240 bn. The main reasons for this slight downtrend were lower amounts due to customers excluding sight deposits (down 4.9%) and lower fiduciary liabilities (down 7.7%). At the same time, securities holdings in customer accounts rose by 0.2%, which explains why the overall figure has held steady at a high level, reflecting continued trust in Swiss banking.