Brief Review

Banking

There are over 400 authorised banks in Switzerland, but UBS and Credit Suisse are the two largest, together accounting for 50% of all Swiss deposits. Because of their size and complexity, UBS and Credit Suisse are subject to an extra degree of supervision from the Federal Banking Commission. UBS came into existence in June of 1998, from the merger of the Union Bank of Switzerland, founded in 1862, and the Swiss Bank Corporation, founded in 1872. Headquartered in Zürich and Basel, it is Switzerland's largest bank, maintaining seven main offices around the world and branches on five continents. As of 2008, UBS had a market capitalization of over $154 billion, and more than 80,000 employees. Credit Suisse, founded in 1856, is the second-largest Swiss bank. Based in Zürich, its market capitalization as of 2007 was $76 billion, employing almost 49,000 people.

The Swiss National Bank (SNB) serves as the country's central bank. Founded by the Federal Act on the Swiss National Bank, it began conducting business on 20 June 1907. Its shares are publicly traded, and are held by the cantons, cantonal banks, and individual investors; the federal government does not hold any shares. Although the central bank of other countries often has regulatory authority over the country's banking system, this is not the case with the SNB. Regulation is solely the authority of the Federal Banking Commission.

The Swiss Federal Banking Commission (SFBC), an independent agency of the Swiss government within the Federal Department of Finance, supervises most banking-related activities as well as securities markets and investment funds. There's no government deposit insurance in Switzerland, with the exception of the Swiss cantonal bank account, where there is 100% deposit insurance supplied by the canton. But your deposits are probably safer in a Swiss bank than in most other banks in the world for a couple of reasons.

Swiss banks have private deposit insurance, from which they can compensate depositors for up to 30.000 CHF of their deposits in a bank if that bank goes bankrupt. Swiss postal is an exception, since all deposits are fully guaranteed by the Swiss government.

In addition, Swiss banks rarely go bankrupt. Almost the only instances when banks have problems, about once a decade, are for small savings and loans that loaned too much money on too little collateral. They are usually bought out by a larger bank.

Most bank services include checking and savings accounts, credit and debit cards, mortgages and loans, internet banking and investment services. The Swiss post also provides some banking services via its Post Finance service.