A Swiss private bank is a bank licensed by the Swiss Financial Market Supervisory Authority (FINMA) that earns its living mainly from wealth management for private and institutional clients. The term describes a line of business more than a legal form. The title of “private banker” is narrower: the Federal Banking Act ties it to sole proprietorships and partnerships in which at least one partner is liable without limit for the debts. According to the members page of the Association of Swiss Private Banks (ABPS), consulted on 13 November 2026, only four of its seven members hold this status.
The sector is shrinking. The number of private banks in Switzerland fell from 85 to 80 in 2025, then to 79 at the end of May 2026, according to the study “Clarity on Swiss Private Banks” published on 24 June 2026 by KPMG Switzerland, the audit and advisory firm, and the University of St. Gallen (HSG). Their model contrasts with that of a cantonal bank, rooted in its canton and focused on payments, deposits and lending.
What does the law say about the Swiss private bank?
A private bank is subject to the same law as any other bank. The Federal Act of 8 November 1934 on Banks and Savings Banks (Banking Act, SR 952.0) governs, from its Article 1, “banks, private bankers (sole proprietorships, general partnerships and limited partnerships) and savings banks”. Only institutions licensed by FINMA may use the words “bank” or “banker” in their company name or their advertising.
The licence comes before any activity. Under Article 3 of the Act, a bank may neither start its business nor register in the commercial register before it has received FINMA’s green light. The conditions apply to all banks:
- an organisation suited to the business;
- minimum capital, set by the Federal Council and fully paid up;
- managers of good repute who provide “every guarantee of irreproachable business conduct”;
- qualified shareholders, from 10% of the capital or votes, who do not undermine prudent management.
FINMA grants it only if all the conditions are or can be met “beyond any doubt”, it states on its page on new licences.
Private banker or wealth management bank: what is the difference?
The difference lies in the owners’ liability. According to the ABPS, a private banker is organised as a sole proprietorship, a general partnership or a limited partnership. One or more partners are liable without limit for the bank’s obligations and invest their own capital in it.
According to the ABPS members page, four institutions hold this status: Bordier & Cie, E. Gutzwiller & Cie Banquiers, Rahn+Bodmer Co. and Reichmuth & Co. They are also members of the Swiss Private Bankers Association, which in 1997 registered the collective mark “private banker” with the Swiss Federal Institute of Intellectual Property.
The other three ABPS members have a different status. Banque Lombard Odier & Co SA, based in Geneva, Mirabaud & Cie SA and Banque Pictet & Cie SA are companies limited by shares owned by a partnership limited by shares. The seven members have one thing in common, according to the association: they belong to private owners and are not listed on the stock exchange.
The status has a practical consequence. Article 6a of the Act requires banks to publish their annual report. Private bankers that do not solicit deposits from the public are exempt.
| Criterion | Private banker | Private bank as a company limited by shares |
|---|---|---|
| Legal form | Sole proprietorship, general partnership or limited partnership | Company limited by shares, sometimes owned by a partnership limited by shares |
| Liability | At least one partner is liable without limit | Limited to the company’s capital |
| Licence | FINMA, Banking Act | FINMA, Banking Act |
| Examples cited by the ABPS | Bordier & Cie, Reichmuth & Co. | Lombard Odier, Pictet, Mirabaud |
Lombard Odier: a Geneva private bank owned by its partners
Lombard Odier illustrates the private bank without private banker status. On its page for private clients, the bank presents itself as a “Swiss private bank since 1796” and as the oldest private bank in Geneva. It says it has been wholly owned by its managing partners, who run it, since its founding, and states that it uses no external debt.
Its clients are wealthy and often international: the bank cites entrepreneurs, senior executives and wealthy families. It claims more than 25 offices and 10 booking centres worldwide.
A dated appointment shows this orientation. On 12 November 2026, finews.ch reported, citing an internal memo, the arrival of Ali Harb as Executive Vice President at Lombard Odier. From Geneva, he will cover the United Arab Emirates and Oman. He comes from UBS, the Swiss big bank, in Geneva, where for 18 years he advised clients with complex and institutional needs. According to the memo, the bank is thereby strengthening its “New Markets” region, which includes the Middle East, Africa and Turkey.
How does a private bank make money?
A private bank lives off the assets it manages for its clients, but those assets do not guarantee its income. According to KPMG, Swiss private banks managed a record of around 3.5 trillion francs in 2025. Net new money inflows reached nearly 96 billion, and asset performance 81 billion.
Profitability, however, declined, under the effect of rising costs and falling interest income. Revenue grew by 1.5% to 21.6 billion francs, but costs rose by 3%. The median cost/income ratio went from 75.6% to 78.2%. The net profit of medium-sized private banks fell by around 46%.
Consolidation is expected to continue. Christian Hintermann, partner at KPMG Switzerland and head of the study, expects the number of institutions to fall “well below the 70 mark” by 2030. This is a forecast, not an established fact.
How does it differ from a cantonal bank or a big bank?
Ownership and business separate the two models. Article 3a of the Act defines a cantonal bank as a bank established by a cantonal legislative act, in which the canton holds more than one third of the capital and voting rights. The canton may guarantee all or part of its obligations: this is the cantonal state guarantee. A private bank, owned by private owners, does not fall under this definition.
The business differs too. According to the BAK Economics study published on 12 November 2026, the basic provision of payments, deposits and loans rests mainly on cantonal banks, regional banks and Raiffeisen. The model of Raiffeisen, a cooperative bank, belongs to this foundation. Internationally oriented institutions, for their part, have made Switzerland a leading centre for cross-border wealth management.
The boundary is not watertight. Luzerner Kantonalbank (LUKB), the cantonal bank of Lucerne, managed 18.5 billion francs in wealth management and advisory mandates at the end of September 2026, as 2clics detailed in its coverage of its nine-month results. Its interest business, with 361 million francs over the same period, nevertheless remained its main source of income. The 24 institutions of the Association of Swiss Cantonal Banks are listed in our list of cantonal banks.
The big bank combines these businesses. According to 2clics, wealth management remained UBS’s main driver when it published its quarterly results on 28 October 2026.
Key figures
- 79 private banks in Switzerland at the end of May 2026, after 85 and then 80 during 2025 (KPMG, 24 June 2026).
- Around 3.5 trillion francs in assets managed by private banks in 2025 (KPMG).
- 4 private bankers among the 7 ABPS members (members page, consulted on 13 November 2026).
- 74.5 billion francs in direct and indirect value added for the whole banking sector in 2025, of which 43.8 billion direct, according to the BAK Economics study for the Swiss Bankers Association (SBA), published on 12 November 2026.
- 157,700 jobs in full-time equivalents at banks in 2025, 338,700 including indirect effects (BAK Economics).
- 24.4 billion francs in banking services exports in 2025, or 14.7% of Swiss services exports, driven in particular by cross-border wealth management (BAK Economics).
Is an asset manager a private bank?
No. Article 1 of the Banking Act excludes asset managers who merely administer their clients’ funds without engaging in banking activity. They may not accept deposits from the public on a professional basis. Their licensing falls under a different regime: according to FINMA, asset managers and trustees are not supervised directly by it, but by a supervisory organisation that it authorises. This clarification is not investment advice.
What we do not know yet
- The pace of consolidation: the fall below 70 private banks by 2030 remains a forecast.
More articles on the sector are collected in the Banks and FINMA section.
Sources
- Fedlex: Federal Act of 8 November 1934 on Banks and Savings Banks (SR 952.0)
- FINMA: new licences for banks and securities firms
- FINMA: licensing process for asset managers and trustees
- Association of Swiss Private Banks: members page
- Lombard Odier: private clients page
- KPMG Switzerland: “Swiss private banks: record assets under management, but declining profitability”, 24 June 2026
- Allnews: BAK Economics press release, 12 November 2026
- Swissinfo: “Swiss banks generate value added of CHF74.5 billion”, 12 November 2026
- finews.ch: “Lombard Odier verstärkt Nahost-Team”, 12 November 2026
