BERNE (Reuters) - There will be further consolidation in Switzerland’s banking industry now that most banks have reached settlements with U.S. authorities over alleged tax evasion by some clients, Julius Baer Chief Executive Boris Collardi said on Thursday.
Union Bancaire Privee became the 76th Swiss bank to reach an agreement with the U.S. Department of Justice last week, agreeing to pay more than $187 million to avoid possible prosecution for helping Americans evade taxes.
Baer CEO Collardi estimated that around 80 percent of banks in this program, launched in 2013, had now resolved their cases and this would prompt further consolidation.
“We cannot rule out that one or another institution would like to merge with another,” Collardi, speaking in his capacity as president of the Association of Swiss Asset and Wealth Management Banks, told a news conference.
“We will see further consolidation in the finance sector, that is quite clear.”
Brazil’s embattled Grupo BTG Pactual SA has put its BSI private bank on the market, while Vontobel> has said it was not for sale after the patriarch of the family that controls it died this month.
Smaller Swiss private banks, which for years benefited from clients bringing money to Switzerland to take advantage of the country’s bank secrecy rules, are struggling under a global clampdown on tax evasion and increasing regulatory costs.
This has put pressure on banks to sell up or close down but looming fines from the U.S. tax program have prompted some potential buyers to stay on the sidelines.
Consultancy KPMG last year predicted the number of Swiss private banks would fall to fewer than 100 in the next three years from around 130 now.
Reporting by Joshua Franklin and Angelika Gruber; Editing by Mark Potter
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