(10.04.2024) The Swiss financial sector successfully surmounted the economic challenges of 2023. According to the bank barometer from consulting firm Ernst and Young (EY), an overwhelming 96% of banks anticipate operational profit growth in 2024.
This record level is 18 points higher than that of 2022 (78%). Banking institutions are showing increasing confidence in the resilience of SMEs, with only 42% expecting a decrease in their solvency, compared to 59% in 2022. The real estate sector also saw a positive shift, with less than a quarter (22%) of banks forecasting a rise in value adjustments for residential properties, down from 31% the previous year.
However, the EY report also signals that the sector is gearing up for a tighter regulatory framework, in the aftermath of Credit Suisse’s collapse. Nearly two-thirds (62%) of respondents anticipate more stringent liquidity requirements, while 40% foresee an increase in capital regulation. The majority of the banks surveyed (67%) expect surveillance activities of the Financial Market Supervisory Authority (FINMA) to increase.
Artificial intelligence (AI) is also of interest to Swiss banks. Nearly 82% of them express interest in it, and 32% have already initiated pilot projects or initial applications. However, only 6% already have a fully operational AI application.
The study also indicates that 37% of Swiss banking institutions already apply environmental, social, and governance (ESG) criteria before granting a loan to an institution. And more than a third (35%) planning to incorporate these principles moving forward.
Last modification 10.04.2024
