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The Swiss financial center at the dawn of 2025: a challenge of regulation and innovation

While the resilience of the sector is undeniable, challenges persist. In particular, financial regulation represents one of the greatest risks for the consolidated results of Swiss banks.

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In 2024, the Swiss financial center has once again demonstrated its resilience in the face of a complex economic environment. Despite global turbulence and increasing geopolitical tensions, the Swiss banking sector recorded very good results in line with the forecasts of the SBA’s Swiss Banking Outlook. This robust performance, supported by customer confidence and bank stability, is excellent news for the country’s economy.

However, while the resilience of the sector is undeniable, challenges persist. In particular, financial regulation represents one of the greatest risks for the consolidated results of Swiss banks. Indeed, if strict rules are necessary to guarantee the stability of the system, excessive regulation could harm innovation and profitability in the long term.

Regulation: a major challenge for 2025

The Swiss banking sector plays a crucial role in the country’s prosperity. With more than 5% of the GDP generated by the sector, it also contributes significantly to job creation and the enrichment of collective well-being. However, this economic performance must be supported by a favorable political and regulatory environment to enable it to create equity through its profits. The banking sector also contributes to the country’s competitiveness by supporting investments. The billions in taxes it pays to the state coffers are tangible testimony to this.

Excessive regulation today represents a brake on innovation. According to the ASB’s Swiss Banking Outlook, excessive regulation risks weighing heavily on the consolidated results of banks. However, the Credit Suisse crisis has highlighted the need to adapt and adjust certain rules. This situation has triggered a series of proposals aimed at strengthening the resilience of the sector. For example, proposals to guarantee the liquidity supply of systemically important institutions in the event of a crisis must be finalized without delay, as they present a positive cost-utility ratio. It is imperative that future discussions on regulatory adjustments take into account the real costs and benefits of each measure, but also the aggregate effect of the measures taken.

Artificial intelligence: a vector of competitiveness

Artificial intelligence (AI) is another area where Switzerland can and must innovate. By 2025, AI will remain a key pillar for Swiss banks, providing opportunities to optimize internal processes, improve customer service and increase return potential. AI is becoming essential in risk management, the fight against financial crime and the pursuit of CSR objectives.

Indeed, the growing use of AI raises questions about the need for strict regulation. The Swiss legislator must remain faithful to a tradition of regulation based on principles and technologically neutral, in order to encourage innovation while guaranteeing security and stability. Framework conditions conducive to innovation will enable Switzerland to play a pioneering role in AI while remaining competitive on the global stage.

A future to reinvent: a call for reliability and open markets.

One of the main priorities for the year 2025 will be to guarantee a stable and reliable regulatory environment. The reliability of political decisions is essential to promote long-term investments and ensure the competitiveness of our economy. This requires a review of current regulatory measures and support for freedom of enterprise and openness.

As a center of competence and spokesperson for the banking industry, the ASB continues to advocate for balanced regulation that makes it possible to effectively deal with risks while maintaining the competitiveness of banks. We must reverse the current trend in which “legal constraints replace entrepreneurial initiatives”. If we manage to create an environment conducive to innovation and intelligent regulation, Switzerland will be able to maintain its role as a world leader in the financial sector.

In short, the Swiss financial center has a solid basis for reinventing itself despite global challenges and regulatory pressures. Innovation, competitiveness and stability must remain the priorities for 2025. This is only possible if we find the right balance between regulation and freedom of enterprise, allowing businesses and banks to prosper while contributing to the stability of our country.

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