Banking in Switzerland

Abstract

The first part of the article calls attention to the operational problems and institutional features of Swiss banking, which are of special “practical” importance for the banking world. Among these are the relations between the several categories of credit institutions and especially between the big commercial banks and the cantonal banks; the widespread system of postal chèques that limits the scope of commercial banks; the elaborate distinction drawn between the several kinds of savings accounts; the special attention devoted by all classes of banks to “little credit”; the strictly orthodox policies followed by the commercial banks in their lending operations after the bitter experience of 1930; the wide range of “ancillary functions” they offer their clients; the role of banks in capital issues; the structure of interest rates. Here, the author draws special attention in the analysis to the role of competition. In the second part of the article the banking law of 1934 and the position of the Central Bank are examined. Here, the author deals with matters more strictly connected with banking policy and credit control. JEL: E52, E58, G21

Keywords

• Swiss banking
• Switzerland
• operational problems
• institutional features
• competition
• Central Bank