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Deposit guarantee for securities in Swiss custody accounts

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Forum Banking Forum Accounts & Interest Deposit guarantee for securities in Swiss custody accounts

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BenutzernameMoneyland User Questions
Status Member
Registriert seit1/27/17
Beiträge2145

April 10, 2017, 8:56:56 AM

Does the deposit guarantee for money placed in Swiss banks cover securities held in Swiss custody accounts as well?

BenutzernameMoneyguru von moneyland.ch
OrtSchweiz
Status Expert
Registriert seit8/4/15
Beiträge4079

April 10, 2017, 1:55:24 PM

Greetings,

The depositor protection scheme adminsitered by banking association Esissuisse covers money deposited into Swiss banks. This is necessary because money deposited in banks is not held by the bank, but rather invested in the bank. If the bank goes bankrupt, the money invested in the bank is largely lost.

Securities, on the other hand, are not invested in the bank (with the exception of the bank's own securities and funds). Custodian banks simply hold and administer securities on behalf of custody account holders. Because of this, there is no need to guarantee securities. These are segregated assets which remain the property of their owner when a custodian bank fails.

Best regards from Moneyguru

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