Hi there

My question is for all those bankers out there, I've searched but was not successfully - I'm not a very good searcher

My understanding is that there is a CHF 30'000 guarantee on funds in Swiss bank accounts. My questions are as follows:

At UBS, clients typically have a relationship number which is consistent with all account and only the last few digits change for each account (eg XXX.XXXXXX.1W for current account and XXX.XXXXXX.R2 for savings account). - Is this regarded as 2 accounts, ie. Are both accounts protected to CHF 30'000 and is there a limit to the number of accounts a person can have?

Also, is the guarantee per account or per person? If we have joint accounts, are both parties guarantee CHF 30'000 or is the account guarantee?

Thanks
Nats

The Xs you refer to are called the Stammnummer. This is the basis of your account and any guarantee is on the Stamm. True Joint accounts are rare in Switzerland. Joint liability is different to joint ownership. Normally there is an account leader and a person with full rights to the account. So 30K per Stamm.

What do you mean by guarantee?? Do you mean if one day the bank goes bankrupt we don't get anything but 30k? Please clarify if I am missing something..

That's exactly what Richard means. And it's 30,000 CHF per person, not 30,000 per account.

So if you have 10,000 in your private account, 20,000 in your savings account and 20,000 in your piller 3A account (for a total of 60,000 CHF), you'd only get 30,000 back in the event of the bank going bust.

Gosh.. I didn't know that. Does every bank has such guaranted limit or it's just for private banks? What about state banks like PostFinance or Bank cantonal.
Thanks!

My understanding is that that Post Finance (which is not a bank) and most kantonal banks are fully guaranteed by the state.

The 30,000 CHF guarantee is also by the state. It wouldn't make much sense for a bank to promise you up to 30,000 CHF in case they fail, because they wouldn't be in a position to honour the guarantee.

Someone mentioned that the guaranteed fund has 4 billion CHF, so if a major bank or multiple smaller banks failed there might not be enough money to honour the promise...

I had a talk with our banker last week, specifically on the subject 'if your bank goes bankrupt', what is protected.

We have normal personal account, joined name saving account, 3rd pillar a and 3rd pillar a (invested in funds).

The answer is: CHF30,000 per person is protected.
a) normal personal account (falls under this CHF30k cap)
b) joined name saving account (falls under the CHF30k cap)
c) 3rd pillar a (also falls under the CHF30k cap)
d) 3rd pillar a invested in funds (this one does not fall under the CHF30k cap)

The bank officer said for 'funds' or 'equity' held, the bank is just provide custody service. So, if the bank goes bankrupt, these fund will be managed by someone else.

Gala

So for a joint account - 60 K is protected, 30 k per person.

Unfortunately not. Joint account only has 30k protection.

That is an accurate statement.

Custodial assets like mutual funds, stocks, etc are separate and fundamentally unaffected by bank insolvency. Note, however, that insolvency would result in inability to access those assets till the appointed liquidator has verified the books and released the custodial assets. Moreover, if you have borrowed money from the Bank, e.g. mortgage, then the liquidator may be tempted to attach the custodial assets to recover the debts.

OK, clueless ones, here is the real deal:

Your money is insured to this amount by the following Swiss banks:

- UBS: 30K CHF per person
- Credit Suisse: ditto (this include 3 Saule accounts, by the way)
- Migros Bank: ditto
- Bank Coop: ditto
- WIR Bank: ditto
- Raiffeisenbank: ditto
- Banque Cantonale Vaudoise: ditto
- Post Bank: complicated explanation, not clear, but better than above
- Banque Cantonale de Geneve: 500K CHF
- Berner Kantonal Bank: 100K CHF
- All other Kantonal banks (e.g. ZKB): NO LIMIT, backed by Kanton Government

So, Grasshopper, which is the safest one?

So have you looked at Zurich's finances and forecasts lately?

Yes this always assumes that the Canton is in better shape than Iceland...

I guess it has to be since the backbone of its corporate tax income is derived from the banking sector.

Oh wait.

"Post Bank" is not a Bank, i.e has no banking license. It is PostFinance, which is a financial institution owned 100% by the Swiss Federal Government. Hence the Swiss Government implicitly guarantees 100% of PostFinance's debts and obligations.

Assuming that Switzerland is in a different category than Iceland, there is no safer place for your assets than Swiss PostFinance.

Moreover, not having a banking license, PF do not issue complex structured instruments, which few understand, and then boomerang. A further plus is that PF are not active outside Switzerland, i.e. no exposure to US sub-prime, etc.

The following should be comforting news for folk with a Mortgage at the same bank as their savings though. According to the Tagesanzeiger on Monday, the bank cannot say "Bad luck chaps, you only get Fr.30,000.00 of the Fr.100,000.00 we were 'looking after' for you, and could you please give us the Fr.150,00.00 you still have outstanding on your mortgage." In the case of Bank Bankruptcy the one sum has to be set against the other. Mind you, I bet if it comes to it, the bank will find some small print which means that we have neither our savings nor the flat.

Just something to keep in mind

1. Custodial assets (stocks, bonds, funds etc) are segregated and generally protected in bankruptcy, UNLESS you have signed the securities lending agreement which authorises the bank to borrow your securities from your account for a small fee. In which case, your securities are lost if the bank goes in default. Worthwhile to check and revoke this agreement if you are worried about the institution.

2. Mortgage offset versus cash account balance, this is generally not standard case. There are clauses in your mortgage agreement that prevent this offset. You need to have asked the bank to take this clause out when you signed. Worthwhile to check.

Hi Goldtop,

Is it possible to open an account with ZKB if living in Kanton Bern?

thanks,

however, i'm sure that this will be very easy to work around. let's say by the bankrupt bank selling the mortgage to someone else. this other party will still have claim to you through the mortgage they bought, but the original bank, may not have enough funds to pay you your deposit.