Banks record best result in four years

Zurich's Paradeplatz is the centre of Switzerland's banking industry Keystone Archive

Swiss banks made a total net profit of SFr15.6 billion ($12.25 billion) last year – one-fifth more than the year before and their best annual result since 2000.

For the first time since 2001, the banks also increased their staffing levels, according to the Swiss National Bank (SNB).

In 2004 the banks increased total annual profit by SFr2.7 billion, the SNB said in its annual statistical yearbook.

Of the 338 banks covered, 316 reported a profit and 22 a loss – total losses rose by 7.5 per cent, but were still relatively low at SFr116 million.

The cumulative profit for 2004 was the third highest in history, and 21 per cent higher than the year before.

The previous record years were 1999 (SFr17.3 billion) and 2000 (SFr19.5 billion).

The SNB said the increase in profit was largely due to the “significant fall in depreciation and value adjustments”. These were considerably lower for all banking groups, but particularly for the country’s two biggest banks – UBS and Credit Suisse.

At SFr1.7 billion, depreciation provisions were at their lowest level ever.

On the operational side, gross profit from banking operations increased by eight per cent – due primarily to commission business and services.

More staff

Switzerland’s 338 banks increased the number of employees on their payroll by 2.4 per cent in 2004 to 115,628 full-time positions.

This was the first increase in staff levels following three consecutive years of cuts.

But most of the jobs created were in branches abroad, the SNB said, where personnel numbers rose by 19.5 per cent to 16,081.

Within Switzerland personnel numbers remained virtually unchanged with 99,547 full-time equivalent positions.

swissinfo with agencies

Key facts

2004 figures (2003):

Annual total profit (billion francs) – 15.607 (12.878)
Gross operating profit (billion) – 23.100 (21.395)
Total assets and liabilities (billion) – 2.491 (2.237)
Number of banks – 338 (342)
Personnel – 115,628 (112,915)

In brief

Switzerland’s two biggest banks – Credit Suisse Group and UBS – together account for 50% of the balance sheet total of all Swiss banks.

There are a total of 24 cantonal banks in Switzerland, which conduct 95% of their business at home.

Private banks are among the oldest in Switzerland. They are mainly involved in asset management, chiefly for private clients.

Foreign-controlled banks are banks where over half the company’s votes are held by foreigners.