On 28 June 2018, the Swiss National Bank (SNB) issued its annual banking statistics on the 2017 banking year. The figures published are based on surveys of banks carried out by the SNB and provide for a comprehensive picture of the Swiss banking sector.
The figures published by the SNB are regularly mentioned in the public domain as a reliable indicator of the amount of assets held with Swiss financial institutions in respect of Indian residents. More often than not, the reports have not taken account of the way the figures have to be interpreted, which has resulted in misleading analyses. Moreover, it is frequently assumed that any assets held by Indian residents in Switzerland are undeclared (so-called ‘Black Money’).
However, the cited figures that show an increase of 50% in Swiss banks’ total liabilities towards India also include non-deposit liabilities as well as business of Swiss branches located in India.
To analyze Indian residents’ deposits held in Switzerland, another data source should be used. This is the so-called “locational banking statistics”, which the SNB collects in collaboration with the Bank for International Settlements (BIS). This data source shows that the liabilities in the form of loans and deposits of Swiss-domiciled banks towards Indian non-banks decreased by 44% between 2016 and 2017. The BIS publishes this data under the following link:
As a global wealth management hub, Switzerland is committed to contributing to the integrity of the international financial system and to a level playing field. Switzerland applies the international transparency standards and therefore actively supports India in its fight against tax fraud and evasion. In this regard, it can be noted that Automatic Exchange of Information in Tax Matters between Switzerland and India entered into force on 1 January 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 the Indian tax authorities in September 2019 and on a yearly basis thereafter. The information also includes accounts that would be closed during 2018. Accordingly, assets held by Indian residents in Switzerland cannot be considered as ‘Black Money’.