The relevance of Swiss asset management has increased again following substantial growth in 2023. The sector is an important pillar of the economy and Switzerland is currently the third-largest asset management market in Europe.
The Swiss asset management industry is back on a robust growth trajectory. This is shown by the results of the 'Swiss Asset Management Study 2024' by the Asset Management Association Switzerland (AMAS) and Lucerne University of Applied Sciences and Arts (HSLU). Even after the takeover of Credit Suisse by UBS, the Swiss asset management industry is characterized by its high level of international competitiveness and a broadly diversified range of products and services. The Swiss pension system in particular also benefits from this.
Industry has returned to a robust growth trajectory
After a challenging year in 2022, the Swiss asset management industry has returned to its robust growth trajectory. Assets under management (AuM) in Switzerland rose by 8.3% to CHF 3'177 billion in 2023. This currently makes Switzerland the third-largest asset management market in Europe. The industry's growth proves that asset management as a whole is an important pillar of the Swiss economy and is proving to be profitable for a wide range of stakeholders.
Asset management is fundamental to the pension system
The asset management industry contributed around 1% to Switzerland's GDP in 2023. It generated CHF 4.05 billion in profits, paid CHF 0.59 billion in taxes and accounts for around 58'700 full-time jobs. Pension funds make up a significant part of the asset management industry's client base: This paid off in 2023 in the 2nd pillar through generated capital market contributions of CHF 59 billion, which underlines the elementary role of asset management in the Swiss pension system. Adrian Schatzmann, CEO of AMAS, emphasizes: «The Swiss Asset Management Study 2024 confirms that the sector is not only a key pillar of the Swiss economy, but will become even more important in the coming years. The development of the industry is characterized by substantial growth, increased social relevance, a stronger commitment to sustainability, a shift towards private and less liquid markets, increased regulatory scrutiny and transformative technological advances.»
Swiss asset management is in demand
Jürg Fausch, economist at Lucerne University of Applied Sciences and Arts and co-author of the study, adds: «In 2023, around 30% of assets under management were managed for foreign institutional clients. Over the seven-year period from 2017 to 2023, the export share increased by 4.8 percentage points. This high export share illustrates the international demand for Swiss wealth management and underlines the importance of domestic expertise.»
The demise of Credit Suisse has changed the market structure
The acquisition of Credit Suisse by UBS marked a significant turning point for the Swiss asset management industry in 2023 and changed the market structure. In 2023, UBS was the largest Swiss asset manager with a market share of 9.3%, while Credit Suisse held 8.3%. As a result of the acquisition, UBS will potentially hold an 18% market share, but the competitive landscape, which is strongly determined by the presence of foreign asset managers and larger cantonal banks, prevents a dominant market position, according to AMAS.
Active management remains predominant
The share of alternative investments in the asset mix of Swiss asset managers continued to grow to 24%, strengthening Switzerland's position in this high-margin business. While passive investments continued to grow, active management remained predominant among Swiss asset managers.
Profitability and sustainability put pressure on the industry
Despite strong growth in 2023, the Swiss asset management industry faces a number of challenges. Firstly, although assets under management grew in 2023, the industry's profitability developed negatively. Secondly, there is increasing public pressure on asset managers to make a measurable contribution to climate protection and greater sustainability. Initiatives for sustainable finance such as self-regulation, the Swiss Climate Scores and the Swiss Stewardship Code, which is actively promoted by AMAS, are gaining importance among Swiss asset managers and are likely to make a significant contribution to meeting sustainability targets.