Home > Money, News of the moment > Swiss Banks Stand to Lose Hundreds of Billions.

Swiss Banks Stand to Lose Hundreds of Billions.

By Valentin Schmid  22nd September 2012.

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UBS predicts massive asset outflows as governments crack down on former tax haven.

Swiss and German flags fly over the Swiss Embassy and the German Reichtsag behind it in Berlin, July 16. After German states purchased the names of German tax-evaders from Swiss bank employees, Germany and Switzerland reached a bilateral tax treaty, though it has yet to be ratified. (Sean Gallup/Getty Images)

Swiss and German flags fly over the Swiss Embassy and the German Reichtsag behind it in Berlin, July 16. After German states purchased the names of German tax-evaders from Swiss bank employees, Germany and Switzerland reached a bilateral tax treaty, though it has yet to be ratified. (Sean Gallup/Getty Images)
Hundreds of billions of dollars could be moved out of Swiss banks as clients attempt to flee a coordinated crackdown on tax evasion, UBS’s Jürg Zeltner told magazine Schweizer Bank on Sept. 17. The crackdown will likely cost Switzerland its tax-haven status.

The head of the UBS wealth management unit predicted that his bank will lose about 12 billion to 30 billion Swiss francs (US$12.8 billion to 31.9 billion) of the 783 billion francs in assets under management for wealthy clients. “As a consequence of the realignment of the financial center and the planned withholding tax, we assume that a total of hundreds of billions of francs will flow out of Switzerland,” he told Schweizer Bank.

Credit Suisse, the other big player in wealth management, estimates it will lose over $37 billion over the next few years as European clients withdraw their money. German business consultants ZEB estimate that out of the total 2.8 trillion francs ($3 trillion) that the roughly 300 Swiss banks have under management, 800 billion francs could be untaxed funds from European citizens. ZEB predicts that 200 billion of those funds could be withdrawn due to several tax treaties and investigative breakthroughs.

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