Switzerland’s secret banks hold up to £162 billion of Russian wealth in offshore accounts, according to industry estimates.
- The Swiss Bankers Association says it is holding up to £162bn of Russian money
- There are calls in Switzerland to limit any cash held by Russians.
- SBA Score Overshadows Initial Signs of Russia Credit Risk
Switzerland’s secret banks hold up to £162 billion of Russian capital in offshore accounts, the country’s financial industry association estimates.
The Swiss Bankers Association (SBA) estimates that between 150 and 200 billion Swiss francs (£121-162 billion) of Russian client money is in banks.
This indicates that the scale of business of rich Russians with banks in Switzerland, the world’s largest center of offshore capital, is much wider than previously thought.
Switzerland’s secret banks hold up to £162 billion of Russian capital in offshore accounts, the country’s financial industry association estimates (file image)
SBA revelations are rare for Switzerland, which has turned down many previous requests for transparency, and it came as it took the unusual step of imposing EU sanctions on Russian money following Moscow’s invasion of Ukraine last month.
Debates about his role are flaring up in the Swiss public. Mattea Meyer, co-chair of the Social Democrats, is calling on Switzerland to limit any money held by Russians close to President Vladimir Putin and his government.
“A part belongs to the oligarchs loyal to the Kremlin. The money and its activities… help to finance the war,” she said, adding that Switzerland “should do everything possible to turn off the money taps.”
The SBA’s assessment, which overshadows the initial signs of Russia’s credit risk, clearly shows the scope of the task of imposing sanctions, such as a cash freeze.
The Swiss economy ministry said it had no meaningful estimates on frozen Russian assets as it tallied reports from banks facing the growing Swiss sanctions list. More
Despite its Russian assessment, the SBA stressed that this is small compared to the total assets held in Switzerland, which generations of wealthy people around the world have seen as a safe haven for their money.
Switzerland has taken the unusual step of imposing EU sanctions on Russian money following Moscow’s invasion of Ukraine last month.
“The share of assets held by Russian clients likely represents a low single-digit percentage share of total cross-border assets deposited with Swiss banks,” said a statement emailed to Reuters on Wednesday. for clients living abroad.
As Western governments impose a growing list of sanctions in response to the Russian invasion, banks are seeing their business with Russian clients come under scrutiny, not only in relation to loans they have made or transactions carried out by Russian subsidiaries that could lead to balance sheet losses. .
Analysts say Swiss banks’ direct exposure to Russian clients looks manageable from what has been released.
Switzerland’s two largest banks last week detailed “limited” exposure to Russia, while the largest bank, UBS, said £482m of direct exposure had been reduced since the end of the year.
Credit Suisse CEO Thomas Gottstein said on Tuesday that about four percent of the assets of Switzerland’s second largest bank, managed by wealthy clients, are owned by Russians, amounting to tens of billions of dollars.
This is far more than the £688m net credit exposure reported in Credit Suisse’s annual report.
While the bank did not provide updates, it managed £671bn of its asset management business at the end of 2021, so four percent would be around £27bn in Russian client-related assets.
UBS and Switzerland’s third-largest lender, Julius Baer, declined to give details about the assets they hold for Russian clients, but UBS CEO Ralph Hamers pointed out that the sanctions are forcing the country’s largest bank to operate.
“New listings are posted every night,” he said, adding that UBS was looking to protect not only against current claims, but also against the risk of future fines.