Speaking about the future of Swiss private banking, Konrad Hummler, managing partner at Wegelin & Co, the St Gallen-based private bank, and president of the Swiss Private Bankers Association, admitted that last year was an “annus horibilis” - a horrible year.

“If one wants to prevent a regulatory overreaction, including new rules concerning the size of institutions or concerning the nominal equity capitalisation, leading to some sort of quasi-rationing of the system, then one will not be able to avoid a functional structural change of the biggest banking institutions of the world,” he said.

Mr Hummler said that it is essential to notice that Swiss banking institutions, too, are part of those to be blamed for the crisis of the system. He added that the crisis showed private bankers how highly interdependent the business is.

Mr Hummler added that it is essential that only the truly system-relevant parts of the banking industry will be able to rely on implicit or explicit state guarantees.

With regards to 2009, the Swiss banker said that Switzerland was exposed to more or less hypocritical attacks from other countries, after the sector was weakened through the destabilisation of its biggest bank, UBS. It then faced attacks from finance and prime ministers, Mr Hummler said, “from nations which often themselves conducted far more problematic cross-boarder wealth management business [than Switzerland].”

“[The pressure put on Switzerland] violated international law and that an international institution, intended for cooperation, was used for blackmailing, should get us thinking, as the reliability of validity of law is one of axioms of working finance business."

Switzerland’s banking business was hit by an international change in taxation policies. This has, among other things, resulted in Switzerland revising Double Taxation Agreements with several member states of the Organisation for Economic Co-operation and Development, amending arrangements on the exchange of information relating to tax matters.

Mr Hummler’s full statement, including an outline of four key points of the Swiss Private Banking Association's strategy, is available online in German and French.