The world of finance in Switzerland is going through sweeping changes. Paradigms are changing. Landmarks and reference points are vanishing. Regulations are proliferating and becoming more stringent. In this climate of great change and upheaval, Banque Cantonale du Valais’ strategy is being crowned with success. Assets placed with it for management as of end-2012 stood at a record 6.6 billion francs, equating to growth of over 10%.
Changing regulations governing wealth management have fundamentally shaken this business up. It is now being strait-jacketed and squeezed ever tighter by a non-stop stream of regulatory constraints and requirements: cross-border laws, the US FATCA, the Weissgeldstrategie (the so-called ‘clean’ or ‘self-declared money’ strategy), automatic exchanging of information or the Rubik agreements. These Rubik agreements, signed with Austria and the UK, stipulate a tax to be levied directly at source on clients’ assets by their own bank.
This constantly shifting international landscape is also bringing its influence to bear on BCVs’ business. The Bank’s goal of achieving better balance in its sources of revenue remains a valid one. Wealth management is one of BCVs’ three cornerstone businesses, alongside corporate & business banking and retail banking. Nevertheless, the never-ending rewriting of legislation, rules and regulations has prompted BCVs to re-engineer its own strategy. The Bank favours an onshore approach. As a result, it targets primarily customers living in Switzerland and, more especially, in the Canton of Valais. BCVs’ primary objective is to consolidate and expand this client-base. It places emphasis on achieving organic growth, retaining assets under management, enhancing the loyalty of existing customers and forging new business relationships. BCVs has also adopted the strategy of ‘clean’ or ‘self-declared money’ when opening new business relations with clients from outside Switzerland. On this score, European customers who honour their tax commitments and obligations in their countries of domicile will still be able to open accounts with BCVs provided that they initiate their relationship on Swiss territory.
The quality of advice furnished by BCVs remains a linchpin in this particular business which is founded on relationships between parties. Considering the ongoing developments on the regulations front, this extra value being added for customers will continue to be a crucial feature for BCVs to mark itself out in the fiercely competitive arena of wealth management.