 | |  As the leading clearing bank in Switzerland, UBS clears about a quarter of all Swiss franc-denominated payments and conducts some 60 per cent of custodial business in that currency. Our client base also numbers more than 3,000 of the world’s leading financial institutions.
Together with UBS Warburg, UBS Switzerland has launched "The Bank for Banks", an outsourcing initiative that seeks to maximize the value of the bank’s extensive correspondent banking relationships by promoting and formalizing cooperation between all UBS business groups. Although this initiative was publicly launched as recently as October this year, the cross-marketing that it entails is already everyday practice.
Take, for example, an institution that (in the near future) chooses to eliminate settlement risk for major currencies by accessing the Continuous Linked Settlement clearing house through UBS Switzerland. For non-CLS currencies, UBS Warburg offers FX Trader, a web-based tool that effectively plugs the client institution directly into the investment bank’s trading floor. Result: the client institution can lock in margins on every trade, thanks to pre-agreed pricing from UBS Warburg. At the same time, the client avoids having to invest in building an expensive dealing infrastructure on its own account.
Costs are, in fact, the key reason why the time is ripe for "The Bank for Banks". Better information systems have alerted the management of many smaller financial institutions to the waning profitability of many business lines. At the same time, technology enables UBS to maximize economies of scale, allowing the bank to pass on the resulting efficiencies to client institutions. Outsourcing non-core operations therefore becomes the basis for a mutually beneficial partnership between UBS and its clients.
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