Finance

Finance industry analysis

In many metropolitan areas of Europe, the financial sector (banks, insurance companies and other financial services providers) has developed into an important pillar of value creation and prosperity.

In the «Monitoring Financial Centers» project, several competitive financial centers are described and compared. The financial services industry is subdivided into (a) banks, (b) insurance companies and (c) other financial services with a very detailed presentation of the performance and its analysis.

In addition to value added and employment, other key figures, such as those used in the financial industry, are also collected. Assets under management, bank balances, issuance volumes, stock exchanges or insurance premiums. Apart from the performance indicators, the market potential and the framework conditions are also identified as relevant variables and their influence on the performance (level and dynamics) is analyzed.


Contact:
Michael Grass
T +41 61 279 97 23
michael.grass(at)bak-economics.com


Marc Bros de Puechredon
+41 61 279 97 25
marc.puechredon(at)bak-economics.com


Indicators

Performance and general conditions

How can performance be measured in the financial sector?
What are meaningful and industry-specific indicators for measuring performance and competitiveness in the financial sector? In the financial sector, the usual economic performance indicators and the indicators used by a majority of the industry itself are widely divergent. Both aspects are therefore taken into account.

What are the influencing factors?
The attractiveness of a location for the financial sector is determined by both supply and demand factors.
On the demand side, it is particularly relevant how large the market is, which can be served from a specific financial center. This depends firstly on the market potential in the narrower sense. This is the volume that is available for operation by the financial sector at all. Depending on the sub-sector concerned, this can be, for example, the gross domestic product (as a proxy for economic activities), the gross social product (as a proxy for income), the number of high-net-worth individuals, private individuals 'wealth, institutional investors' capital, Number of companies. This is about the level and the growth trend of the Heimmarkt. These factors can not be directly influenced by a location policy, but they play an important role in attractiveness. Natural market restrictions (geographic, national, cultural) are therefore measured and compared.

The effective volume of the market for a financial center is also directly influenced by the policy. The limits of the natural market can be shifted by means of regulatory easements, for example, in capital movements or in supervision. An important role is also played by the tax legislation, since taxation, on the one hand, changes the overall available volume, on the other hand, a wedge is driven between the service provided by the financial sector and the benefit of the customer. Taxes on income, on capital gains, on assets and on inheritances are particularly relevant.


Financial centers

Which financial centers are relevant?
Apart from the comprehensive coverage of the population and the economy with financial services (retail front of banks and insurance companies), financial services are mostly concentrated in a highly concentrated manner. As a result, national data (e.g., collected by central banks) are often good indicators of the respective leading financial center (e.g., issue volume of shares or bonds). Wherever possible, data is collected for the respective financial center.

The following list provides an overview of the financial centers relevant to the project.

Switzerland
Zurich (as well as Geneva, Ticino, Basel)

Germany
Frankfurt

France
Paris
Austria
Vienna

Italy
Milan

Liechtenstein
Vaduz

Spain
Madrid

Holland
Amsterdam

Belgium
Brussels

Luxembourg
Luxembourg

United Kingdom
London, Edinburgh

Ireland
Dublin

USA
New York, (Chicago)

Japan
Tokyo

China
Hong Kong, (Shanghai)

Singapore
Singapore

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