Merz says banking secrecy concessions possible

Switzerland will not give up its banking secrecy laws, but some concessions may need to be made to appease objectors, Swiss President Hans-Rudolf Merz has said.

Banking secrecy is anchored in Swiss law but “we need to accept discussion on it and make a few concessions”, Merz told a conference marking the creation of the new Radicals-Liberals political party on Saturday in Bern.

Failure to open debate on the issue could result in Switzerland being blacklisted as an uncooperative tax haven by the Organisation for Economic Co-operation and Development, he said, which in turn would lead to sanctions against banks and serious consequences for the financial sector.

Banking secrecy also came under criticism from Oswald Grübel, the new head of Switzerland’s largest bank, UBS.

Swiss banking secrecy laws need to be changed in order to ease the political pressure from other countries, Grübel said in an interview published in the Finanz und Wirtschaft newspaper on Saturday.

“It’s questionable whether we can continue to hide tax evaders behind banking secrecy,” said Grübel, who replaced UBS former chief executive officer Marcel Rohner on Thursday.

Grübel added that other countries were using the issue of banking secrecy to attack Switzerland’s position as a leading centre for wealth management, in order to force billions of dollars back into their own financial centres.

UBS is currently the subject of a probe by US authorities into whether it helped wealthy Americans illegally evade $200 billion (SFr234 billion) in taxes. Earlier this month, the bank was forced to pay $780 million in fines and handed over the names of around 300 suspected tax fraudsters to the US.