Switzerland needs two large banks to fuel competition, Julius Baer’s president and CEO said in an interview with a newspaper, amid speculation about the future of Credit Suisse, the second-largest lender after UBS.

“Competition drives business. Two healthy and strong large banks are important for the Swiss financial center,” Philipp Rickenbacher told the Neue Zuercher Zeitung.

Credit Suisse is trying to turn the page on costly scandals that prompted an almost complete reshuffle of top management and a restructuring to limit risk-taking. A message this month that State Street Bank was considering a takeover bid – which has since been denied-briefly sent the stock soaring.

Rickenbacher said Baer was well placed to handle the consolidation expected in the sector.

“It has been suspended since 2020 because the markets were doing well and all banks were benefiting. But Asset Management is becoming structurally more expensive and regulatory density is increasing, ” he was quoted as saying.

“Technology is also increasingly penetrating our company, even though people will always continue to play a central role. Julius Baer can handle the necessary investments, many smaller asset managers cannot.”

He said clients are wary of taking new risks given market uncertainty amid COVID-19 restrictions in Asia, disrupted supply chains, inflation fears and the Russian-Ukrainian conflict.

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