Aggregate funds of all foreign clients of Swiss banks also fell by over 4 percent to CHF 1.4 trillion (nearly Rs 99 lakh crore) in 2018, as per the annual banking statistics released by the Zurich-based central banking authority of Switzerland.
Money parked by Indian individuals and enterprises in Swiss banks, including through India-based branches, fell by nearly 6 percent in 2018 to 955 million Swiss francs (about Rs 6,757 crore) to hit its second-lowest level in over two decades, Swiss National Bank data showed Thursday.
Money parked by Indians in Swiss banks fell by nearly 6 percent in 2018 to 955 million Swiss francs.
According to the SNB, its data for ‘total liabilities’ of Swiss banks towards Indian clients take into account all kinds of funds of Indian customers at Swiss banks, including deposits from individuals, banks, and enterprises. This includes data for branches of Swiss banks in India, as also non-deposit liabilities.
However, the ‘locational banking statistics’ of the Bank for International Settlement (BIS), which the Indian and Swiss governments had said last year was a more reliable measure for deposits by Indian individuals in Swiss banks, showed a greater fall of 11 percent for 2018.
The funds, described by the SNB as Swiss banks ‘ ‘ liabilities ‘ or ‘ amounts due to ‘ their customers, are official figures reported by the banks and do not indicate the quantity of the much-debated alleged black money held there by Indians.
However, the quantum of such funds has fallen again in 2018 to CHF 954.71 million, which includes about CHF 15 million held through fiduciaries or wealth managers. This is the second-lowest total since CHF 723 million recorded over two decades ago in 1995. The lowest ever amount of CHF 675 million, ever since Switzerland began making the data public in 1987, was recorded in 2016.
The SNB data had shown the total liabilities of Swiss banks towards Indian clients rising by over 50 percent in 2017 to CHF 1.01 billion (Rs 7,000 crore), reversing a three-year downward trend.
On the asset side, Swiss banks saw a marginal increase in the amount due to their Indian customers to CHF 212 million (from CHF 210 million in 2017).
In comparison, the BIS data showed that the total amount outstanding to non-bank or individual Indian clients of Swiss banks fell to USD 84.6 million at the end of 2018 (by 11 percent from USD 94.8 million at the end of 2017). The fall was much larger at 44 percent during 2017.
The BIS publishes quarterly figures, which shows that these funds rose during the first quarter of 2018 (to USD 100.9 million) but declined in the three remaining quarters of the year.
The annual SNB data has shown a decline four times during the last five years. The fall was the maximum at 45 percent in 2016.
Since those record levels, there has been a rise only three times — in 2011 (12 percent), 2013 (43 percent) and then in 2017.
A new framework has been put in place for automatic exchange of information between Switzerland and India to help check the black money menace with effect from January 1, 2018.
Detailed financial information on all Indian residents that have an account maintained by a Swiss financial institution in 2018 will be provided for the first time to India.
The tax department identified suspicious black money running into thousands of crores of rupees following worldwide leak inquiries of Indians stashing funds overseas and initiated prosecution against hundreds of them, including those with accounts in HSBC’s Geneva branch.
As per the SNB, there were 248 banks in Switzerland at the end of 2018, of which 216 reported a profit while 32 suffered losses.
Their aggregate profit rose to CHF 11.5 billion, but an overall balance.
writer: Sakshi Gupta