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Swiss Finance: Capital Markets, Banking, and the Swiss Value Chain

Book Description

A timely guide to the complex financial markets and banking secrecy of Switzerland

Since 1934, when Switzerland's federal bank secrecy law was passed, the line between myth and reality with regard to Swiss banking has been blurred. But over the past decade, there have been dramatic changes in the pressures brought to bear on all facets of the Swiss financial markets and banking sector. Recent developments and agreements have potentially weakened Swiss banking secrecy, and with that said, it is time for a book that lays out the history of Swiss bank secrecy and puts these twenty-first century changes in perspective.

Swiss Finance is a thorough overview of the Swiss financial markets and the banking secrecy this country has become known for. It covers key topics to practitioners both abroad and in the United States involved in Swiss banking and the Swiss financial markets.

  • Discusses what the Euro-debt crisis may mean for the role of Switzerland as a financial powerhouse

  • Reveals how new secrecy agreements with the United States and Germany will impact private wealth management

  • Addresses Asian competition for wealth management and tax havens

Switzerland is one of the largest financial markets in the world and a global power in private wealth administration. Whether you're a private wealth advisor, Swiss or U.S. banker, or other finance practitioner involved in the Swiss market, this guide is essential reading if you intend on achieving future success in this arena.

Table of Contents

  1. Cover
  2. Additional Praise for Swiss Finance
  3. Series
  4. Title Page
  5. Copyright
  6. Dedication
  7. Preface
  8. Introduction
  9. Chapter 1: Finanzplatz Schweiz
    1. INTRODUCTION
    2. SWISS VALUE CHAIN
    3. STOCK EXCHANGE LAWS AND REGULATIONS
    4. CONCLUSION
    5. APPENDIX 1A: THE ROAD TO FINANZPLATZ SCHWEIZ
    6. APPENDIX 1B: LISTING AND ABBREVIATIONS FOR GROUP BUSINESSES, PARTICIPATIONS, DIVISIONS, FIELDS, CORPORATE SERVICES, EXTERNAL SERVICES, AND GROUP SITES
  10. Chapter 2: The Swiss Banking System
    1. INTRODUCTION
    2. BANKING AND THE SWISS ECONOMY: A BRIEF HISTORICAL REVIEW
    3. SWISS BANKS IN THE BROADER SWISS ECONOMY
    4. SWISS BANKS' RELATIVE SIZE, VALUE ADDED, AND PROFITABILITY
    5. INTERNATIONALIZATION OF SWISS BANKS
    6. SWISS BANKING STRUCTURE: AN OVERVIEW
    7. DEPOSIT INSURANCE SCHEME
    8. SWISS BANKS' OFF-BALANCE SHEET ACTIVITIES
    9. CONCLUSIONS
    10. A NOTE ABOUT THE CHAPTER APPENDICES
    11. APPENDIX 2A: UBS AG
    12. APPENDIX 2B: CREDIT SUISSE
  11. Chapter 3: Swiss Banking Secrecy
    1. INTRODUCTION
    2. FOUNDATIONS OF SWISS BANKING SECRECY
    3. PUTTING SWITZERLAND'S BANKING SECRECY INTO PERSPECTIVE
    4. PRESSURE TO INCREASE BANKING SECRECY RULES
    5. EXCEPTIONS AND NUANCES TO SWISS BANKING SECRECY LAWS
    6. SWISS JUDICIAL AND ADMINISTRATIVE ASSISTANCE TO FOREIGN NATIONS
    7. CONCLUSION
    8. APPENDIX 3A: SWITZERLAND'S DORMANT ACCOUNTS CONTROVERSY
    9. CONCLUSION TO SWITZERLAND'S DORMANT ACCOUNTS CONTROVERSY
  12. Chapter 4: Swiss Institutional Investors
    1. INTRODUCTION
    2. SWISS SOCIAL SECURITY: THE THREE PILLARS
    3. SWISS INSURANCE COMPANIES
    4. SWISS INSURANCE MARKET STRUCTURE
    5. LEVEL OF INTERNATIONALIZATION
    6. COMPETITION WITH BANKS
    7. ASSET STRUCTURE OF INSURANCE COMPANIES
    8. REGULATION
    9. INFLUENCE OF PENSION FUNDS AND SOCIAL SECURITY SYSTEM ON SWISS CAPITAL MARKETS
    10. MUTUAL FUNDS
    11. REAL ESTATE FUNDS
    12. FOREIGN SECURITY INVESTMENTS
    13. DIVERSIFICATION OF INVESTMENT FUNDS
    14. INDUSTRY CONCENTRATION
    15. COLLECTIVE INVESTMENT SCHEMES ACT
    16. CONCLUSION
  13. Chapter 5: Swiss National Bank and Monetary Policy
    1. INTRODUCTION
    2. OVERVIEW OF THE SWISS NATIONAL BANK
    3. INDEPENDENCE
    4. TRANSPARENCY
    5. ORGANIZATIONAL STRUCTURE
    6. MONETARY POLICY INSTRUMENTS
    7. MONETARY POLICY
    8. MONETARY POLICY DURING THE SOVEREIGN DEBT CRISIS OF 2010 TO 2011
    9. CONCLUSION
  14. Chapter 6: Swiss Francs in the Global Exchange Markets
    1. INTRODUCTION
    2. SIZE AND STRUCTURE OF THE SWISS-FRANC MARKET
    3. OVERVIEW OF THE SWISS FRANC'S INTERNATIONAL VALUE
    4. THE SWISS NATIONAL BANK AND SWISS FRANC
    5. THE SWISS FRANC: SAFE-HAVEN CURRENCY
    6. SWISS FRANC AND EURO
    7. SWISS FRANC AND GOLD
    8. SWISS FRANC AND SWITZERLAND'S BALANCE OF PAYMENTS
    9. CURRENCY INTERVENTION AND SUSTAINABILITY
    10. CONCLUSION
    11. APPENDIX 6A: MAJOR DETERMINANTS OF THE SWISS FRANC'S VALUE
  15. Chapter 7: Swiss Debt Markets
    1. INTRODUCTION
    2. SWITZERLAND'S UNBALANCED DEBT MARKET
    3. SWITZERLAND'S SHALLOW MARKET FOR SHORT-TERM DEBT
    4. DISTINGUISHING FEATURES OF SWITZERLAND'S DEBT MARKET
    5. THE SIZE OF THE SWISS-FRANC DOMESTIC AND FOREIGN DEBT MARKET
    6. MAJOR SWISS-FRANC DEBT MARKETS
    7. CONCLUSION
  16. Chapter 8: Swiss Equity Markets
    1. INTRODUCTION
    2. EQUITY MARKETS
    3. TYPES OF EQUITY AND LEVERAGE
    4. TYPES OF INVESTORS
    5. TYPES OF TRANSACTIONS
    6. LISTING REQUIREMENTS FOR SWISS EQUITIES
    7. REGULATORY FRAMEWORK
    8. SECURITIES MARKET OVERVIEW
    9. SECTOR AND COMPANY OVERVIEW
    10. TRADING ACTIVITIES
    11. STOCK MARKET PERFORMANCE
    12. FOREIGN SHARES
    13. INTERNATIONAL COMPARISON OF STOCK MARKETS
    14. IMPACT OF THE RECENT FINANCIAL CRISIS ON THE SWISS EQUITY MARKETS
    15. CONCLUSION
    16. APPENDIX 8.A: SWISS LAWS TO PROTECT THE CUSTOMER POSITION AND TRANSACTION CONFIDENTIALITY
    17. APPENDIX 8.B: EQUITY TRANSACTION COSTS IN SWITZERLAND
  17. Chapter 9: Swiss Derivative Markets
    1. INTRODUCTION
    2. EVOLUTION OF DERIVATIVE MARKETS
    3. EFFECTS OF THE 2007-TO-2009 FINANCIAL CRISIS ON OTC AND EXCHANGE-TRADED DERIVATIVES
    4. EUREX GROUP
    5. EUREX CLEARING
    6. SCOACH EXCHANGE43
    7. MOST ACTIVELY TRADED DERIVATIVE PRODUCTS
    8. SWITZERLAND'S RELATIONSHIP TO EURO-DENOMINATED DERIVATIVES MARKETS
    9. CONCLUSION
    10. APPENDIX 9A: DERIVATIVES, GAMBLING, AND SWISS COURTS55
    11. APPENDIX 9B: PRIMER ON DERIVATIVES AND DERIVATIVE MARKETS
    12. PHYSICAL VERSUS CASH SETTLEMENT
    13. DERIVATIVE CLASSIFICATION
    14. DERIVATIVE USES AND USERS
    15. APPENDIX 9C: EXPLANATIONS OF THE MOST COMMON DERIVATIVES(ARRANGED ALPHABETICALLY)
    16. SINGLE CURRENCY INTEREST RATE DERIVATIVES
    17. FOREIGN EXCHANGE DERIVATIVES
    18. EQUITY AND STOCK INDEX DERIVATIVES
    19. CREDIT DERIVATIVES
    20. COMMODITY DERIVATIVES
  18. Chapter 10: Swiss Taxes on Investment and Financing
    1. INTRODUCTION
    2. FEDERAL WITHHOLDING TAX
    3. FEDERAL AND CANTONAL STAMP DUTIES
    4. PERSONAL INCOME TAXES
    5. PERSONAL CAPITAL GAINS TAX
    6. CORPORATE INCOME TAX
    7. CORPORATE CAPITAL TAX
    8. VALUE-ADDED TAX (VAT)
    9. CORPORATE CAPITAL GAINS TAX
    10. SPECIAL ASPECTS OF CORPORATE TAXATION
    11. CONCLUSION
    12. APPENDIX 10A: INTERNATIONAL CORPORATE INCOME TAX RATES 2011 27
  19. Conclusion and Outlook
    1. SWISS FINANCIAL MARKETS
    2. MAJOR CHALLENGES
    3. OUTLOOK
  20. About the Authors
    1. HENRI B. MEIER
    2. JOHN E. MARTHINSEN
    3. PASCAL A. GANTENBEIN
  21. Index