Facing mounting pressure from US authorities, Swiss wealth managers are increasingly registering with the Securities and Exchange Commission (pictured below) as they try to grow their US client base. Failure to register means they cannot have any American clients, still the largest national wealth-group in the world.
According to research by the Aite Group, based on data from March 2013, the number of Switzerland-based private wealth management firms registered with the SEC rose by 725 per cent between 2007 and 2012.
There were 33 private wealth managers registered with the SEC in Switzerland in 2012, compared to only four five years before.
So far, they have collected $14.1 billion in assets under management from American clients, the report said, adding that this represented only 0.07 per cent of the country’s total HNW private wealth.
According to the study, however, Swiss wealth managers could grow US assets to $50 billion in the medium term and up to $100 billion in the long term.
‘Switzerland’s ongoing entanglement with US authorities over past tax-evasion misdemeanours has caused pain to many in the Swiss market,’ Stephen Wall, senior analyst in wealth management at Aite, said in a statement.
He added that the wealth managers which have decided to register as investment advisers have the potential to ‘turn this hugely negative period into a long-term positive for Switzerland’s wealth management sector’.
Pictured above: A chart showing how many Swiss wealth managers have signed up to the SEC to become RIAs (registered investment advisers)
But if Switzerland’s wealth management firms are trying to improve their relationship with US authorities, bankers in the country are increasingly afraid to travel abroad for fear of arrest.
Last week, Raoul Weil, former chairman of UBS’s global wealth management division was arrested in Italy for having allegedly helped US clients evade taxes.
Martin Naville, head of the Swiss-American Chamber of Commerce, told Swiss newspaper Le Matin Dimanche, ‘In my opinion, some 1,000 Swiss bankers no longer dare to go to the US, or even travel abroad.’