Hundreds Of Billions Of Dollars Expected To Be Withdrawn From Swiss Banks Amid Tax Evasion Crackdown

TBI - Reuters ^ | 9-17-2012 | Emma Thompson

[blam]

Hundreds Of Billions Of Dollars Expected To Be Withdrawn From Swiss Banks Amid Tax Evasion Crackdown

Emma Thomasson, Reuters
Sep. 17, 2012, 4:46 AM

ZURICH, Sept 17 (Reuters) - UBS expects Swiss banks to see European clients withdraw "hundreds of billions of francs" as a result of steps to stop foreigners using secret accounts to evade taxes.

Juerg Zeltner, head of UBS wealth management, reiterated an estimate he gave in May that Switzerland's biggest bank could see outflows of 12-30 billion Swiss francs ($12.8-31.9 billion) from total European assets under management of over 300 billion.

"As a consequence of the realignment of the financial centre and the planned withholding tax, we assume that a total of hundreds of billions of francs will flow out of Switzerland," he told the Schweizer Bank magazine in an interview on Monday.

"In the offshore business with European customers, I assume that we will have to live with significant outflows of wealth for quite a long time yet."

German financial services consultancy Zeb/Rolfes Schierenbeck Associates estimates Swiss banks could see European clients pull up to 200 billion francs by 2016 of the 789 billion it believes they currently hold in untaxed assets.

Zeltner's comments come just days after Credit Suisse , Switzerland's second biggest bank, said it expected clients in western Europe to withdraw up to $37 billion in the next few years due to pressure on the tax issue.

Putting the potential outflows in context, Zeltner said UBS had seen about 200 billion francs of withdrawals during the financial crisis, when the bank had to be rescued by a government bailout after huge subprime losses. Client assets fell almost double that amount due to market and currency moves.

Swiss bank secrecy - which has helped the country build a $2 trillion

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[longtermmemmory]

I am surprised the whistle blower is not subject to swiss criminal prosecution.

[Pearls Before Swine]

All I know is 20 years after Noriega, Panama is a large banking center.

Yes, but it's hard to believe they would maintain confidentiality in the face of heavy US pressure. It may work for the Latins, but it won't work for US citizens. We may have to put coins under the mattresses.