The chairman of the SBA has reportedly urged his country's banks, such as middle-sized firms, to work with Asian partners in trying to exploit the region's increasing wealth.

The shrinking number of Swiss banks should consider teaming up with other firms to expand in Asia and its rising number of millionaires, the chairman of the Swiss Bankers Association is reported to have said.

Besides its big-name banks such as Credit Suisse, UBS and Julius Baer – all prominent players already in Asia – Switzerland has a mixture of foreign banks, cantonal banks, stock exchange banks, regional and savings banks, private banks and “other banks”, adding up to 253 in total as at the end of 2017, down from 261 a year earlier, according to the SBA’s website. The total number of banks has steadily reduced in recent years, from below the 300 market just a decade ago, as consolidation has taken place. The demise internationally of Swiss bank secrecy laws and rising compliance costs, added to the pain of negative Swiss official interest rates, has forced the changes.

The environment makes it harder for Swiss banks to expand overseas, Herbert J Scheidt said in an interview in Singapore with Bloomberg recently.

“When the outside pressures continue in the same way as they have over the last 10 years, there are undoubtedly some banks who feel either to partner, or to exchange their equity with another bank” is a sensible approach, said Scheidt. For Swiss banks considering expanding in Asia, “it makes a lot of sense to engage in partnerships because the world’s too complex to regard everything just as competition.”

“The wealth creation here in Asia is bigger and faster at the moment than in Europe,” Scheidt said. “A challenge for the Swiss banks is to grow their presence in those areas.”

The report cited figures from a recent KPMG report noting that since 2010, 56 Swiss private banks, including those in the middle-sized rankings, have departed the market, taking the number down to 107.

The SBA website shows that the country remains by some distance the world’s largest offshore financial centre, however, with $2.3 trillion of assets.

The idea of Asian tie-ups with local players has been in evidence for some time. In August, Lombard Odier (Singapore) Ltd, part of the Geneva-based Swiss bank, worked with Mizuho Securities (Singapore) to offer investment solutions and wealth management expertise in Asia. Lombard Odier announced strategic partnerships with UnionBank in the Philippines in August 2016, Kasikornbank in Thailand in December 2014 and most recently, Bank Mandiri in Indonesia in April this year. Julius Baer and Nomura recently announced a strategic partnership, with the Japanese financial services group taking a 40 per cent shareholding in Julius Baer Wealth Management Ltd. This enables the Swiss group to open up JBWM’s bespoke discretionary mandate services to wealthy Nomura clients in Japan. Julius Baer and Siam Commercial Bank, a Thailand-based group, in March signed an agreement to establish a joint venture focusing on offering wealth management services to Thai clients.