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Although Credit Suisse had to be taken over by UBS in times of need, this hardly affected the Geneva banking center.
March 19, when the takeover of Credit Suisse by UBS was announced, “will remain etched in our memory forever,” said Denis Pittet of the Lombard Odier bank and president of “Fondation Genève Place Financière” on Thursday in Geneva .
As an umbrella organization, the foundation represents banks, asset managers and other financial institutions in Geneva. That’s 6,500 companies with a total of almost 38,000 employees. They make up around 13 percent of Geneva’s economic output.
Legend: Of the tens of thousands of jobs in Geneva’s financial sector, less than one in ten are at UBS and Credit Suisse. These two financial institutions employ 1,700 people. Keystone/Martin Ruetschi
Despite the tremor in the banking world and the announcement of 3,000 job cuts in Switzerland, Pittet is not particularly worried. One must remain modest, but the concerns for Geneva’s financial center are manageable. The employees would work on the “front”. Translated from banking jargon, this means that the UBS and CS Geneva employees are customer advisors and asset managers.
These have a customer base and generate high added value. Above all, there is hardly any duplication in the merger in this area, says Pittet. This is more the case with administration, IT or management, but these areas are concentrated in Zurich.
I don’t feel any gloating, the entire Swiss financial center suffered from this affair.
In addition, Geneva’s financial institutions also benefit from other flourishing economic sectors in Geneva: raw materials trading and shipping companies. Although the Geneva banking center could get off lightly, Edouard Cuendet, director of “Genève Place Financière” says: “I don’t feel any gloating, the entire Swiss financial center has suffered from this affair.”
But if Geneva is less affected than Zurich, will the German-speaking Swiss economic metropolis suffer? No, says Christian Bretscher from the Zurich Banking Center Association, which represents banks and insurance companies. In his opinion, Geneva is also less affected by job cuts.
But in Zurich, these jobs were lost in a financial center that has a total of 97,000 jobs and is suffering from a very severe shortage of skilled workers. “We assume that the jobs that are lost here will very quickly be compensated for in other companies,” says Bretscher.
Russia sanctions are not a big issue in Geneva
The measures taken against sanctioned people close to Russian President Vladimir Putin, whose funds were blocked as a result of the war in Ukraine, are also not causing great concern in Geneva. In Switzerland, 7.5 billion francs are blocked. When asked by SRF News, the responsible State Secretariat for Economic Affairs (Seco) did not specify how much falls on which banking center. The “Genève Place Financière” foundation also does not provide any further information.
However, in an economic survey, banks said the sanctions had only a medium to weak impact on them. Cuendet sees the reason for this in the orientation of the Geneva financial center. This focuses on the Latin countries of Europe and the Middle East. This has a long tradition. In the past, entire families like those of the King of Saudi Arabia would have vacationed in Geneva. They would have valued Switzerland’s stability. Good business relationships developed from this. Accordingly, the banks in Geneva are looking positively towards the future.