Swiss Banks, usually synonymous with stashed up money and unaccounted funds - have earned an infamous status internationally. However, despite all the shady dealings that take allegedly place in these banks, the Swiss Banks have been quite strict when it comes to cryptocurrency and blockchain related businesses. Hypothekarbank Lenzburg has now become the first bank in Switzerland to open up to cryptocurrency businesses - allowing them to set up their bank accounts with them.
However, the bank is not the first in the country to provide crypto related services as Falcon Private Bank has been providing crypto asset management services since last year. However, it is the first to allow crypto related businesses to set up bank accounts.
Hypothekarbank Lenzburg CEO Marianne Wildi commented that being a bank which believes in the growth of the fintech sector, they want to help promote the ‘young sector’ of crypto and blockchain companies in Switzerland.
The Hypothekarbank Lenzburg CEO also pointed out that the bank is quite aware of the problem of money laundering that cryptocurrency related businesses and ICOs are often accused of. However, Hypothekarbank Lenzburg will be taking some strong steps towards ensuring that this does not happen. The bank will examine and assess all risks carefully and will report all such instances to the Swiss Financial Market Supervisory Authority (FINMA).
"As a bank that sets itself up technologically and pursues a cooperative strategy in the field of fintech, it is also a matter of credibility to work together with the young sector of crypto and blockchain companies in Switzerland".
Wildi further comments that Hypothekarbank Lenzburg is highly selective when it comes to accepting new clients. Reportedly, the bank only has two crypto customers at the moment and each potential client is being thoroughly vetted and consultations are being made with the FINMA before approval. The bank wants to ensure that they offer services only to the best of companies which have a proper credibility.
The cost of the due diligence process would be passed on to their clients - which means that setting up an account with the bank would cost the crypto businesses a little more than other traditional businesses. To help the bank with the due diligence process about their clients, Hypothekarbank Lenzburg has hired compliance experts Geissbuehler, Weber & Partner. CEO Wildi commented on this, saying:
“They have a lot of expertise in the crypto sector and will analyze client requests in terms of their legal background and potential impact for us, giving our management a recommendation”
Swiss Banks have been strict on cryptocurrency related businesses citing the anti-money laundering requirements as well as the Know Your Customer commitments which crypto businesses tend to overlook or circumvent.
Interestingly, Switzerland’s Zug Valley has become home to a number of cryptocurrency related businesses. However, despite this massive influx of crypto companies in the country, the Swiss banks continue to be hostile towards the sector. It looks like Hypothekarbank Lenzburg’s decision to accept crypto clients is likely to bring forward a change in the policies of other banks as well.