Swiss private banks: record assets, but lower profits

The record-high level of assets under management was mainly attributable to a strong influx of around CHF 96 billion in net new money, an increase of about one-third compared to the previous year. “In times of geopolitical uncertainty, Swiss private banks benefit from Switzerland’s reputation as a safe haven. Not least, tensions in the Middle East are likely to have contributed to an additional influx of net new money”, says Pascal Sprenger, Partner and Head of Financial Services at KPMG Switzerland.

While the performance of assets under management (CHF 81 billion net) positively impacted growth in assets under management, this effect was not as strong as in the previous year (CHF 332 billion). Disregarding the negative impacts of the weak USD, the figure would have been CHF 150 billion higher. The industry reported inorganic growth of CHF 35 billion through takeovers and acquisitions. 

Private banks in Switzerland increased their revenue by CHF 321 million year over year to CHF 21.6 billion (+1.5%). Since the cost base increase (3%) was steeper than the increase in revenue, profit at private banks of all sizes declined on average.

Another thing that stands out is the shift within the industry. While the big players and some of the smaller institutions benefited from growth, medium-sized private banks came under pressure. The cost-income ratio in this size segment rose considerably alongside substantial declines in both gross and net profit. In fact, declining income coupled with simultaneously rising costs caused the latter to tumble by around 46%. By comparison, large private banks reported that profits were down by around 6%, whereas smaller banks reported a decline of 5%.

“Growth in assets under management alone is not sufficient. What matters is whether it results in sustainable income and efficiency gains,” says Christian Hintermann, Partner at KPMG Switzerland, who headed up the study. The industry-wide increase in the median cost-income ratio from 75.6% to 78.2%, however, shows that private banks are operating less efficient than in the previous year. 

Market consolidation is accelerating at the same time. The number of Swiss private banks fell from 85 to 80 institutions in 2025, declining even further to 79 by the end of May 2026. According to Hintermann, the number of private banks in Switzerland is likely to fall well below 70 by 2030. “Consolidation will continue, especially among smaller institutions. These are particularly attractive to international providers interested in expanding or establishing a presence in the Swiss market.”

The study also examined the use of artificial intelligence in Swiss private banks for the first time. The survey results show an ambivalent picture: Roughly four-fifths of the institutions surveyed use AI to boost productivity in certain areas. The systematic integration of AI in end-to-end processes or clearly distinct use cases continues to be the exception. This is also evident in cautious AI investments: Only around 18% of the banks surveyed invested more than CHF 500,000 in AI in 2025. According to the survey, this figure will rise to 30% in 2026.

AI’s impact in business terms is still limited. So far, most banks are reporting that they have not seen any measurable cost reductions and hardly any revenue increases. For example, 76% of the institutions surveyed indicated that the use of AI would help them achieve either no or minor cost savings of roughly 2% or less in the next 12 months.

Private banks are also cautious when it comes to their revenue expectations; nearly half of private banks do not expect any AI-driven increases in revenue over the next 12 months. “Right now, AI is primarily a strategic issue for the industry. Its role as an income driver is only minor so far,” says Hintermann. The survey clearly indicates, however, that this could change in the medium term – provided that AI is more heavily incorporated into processes, scaled technologically and clearly embedded in the organization.