For years, the relationship between Swiss banks and Italian clients has been characterised by a paradox: on the one hand, a high demand for banking and investment services from sophisticated clients, on the other, regulatory restrictions that forced them to physically cross the border or maintain accounts in Switzerland. This scenario is changing.

With the entry into force of the European CRD VI directive scheduled for 10th of January 2027, banks from non-EU countries, including Switzerland, will be able to operate in Italy only through the opening of a branch. To understand the main implications of this directive, we met with Gianbattista Geroldi, CEO of Objectway Italy, a leading technology consulting firm for banks and wealth management firms.

What will change for non-EU banks that decide to operate in Italy?
Regulatory developments present operators with a crossroads. Currently, foreign bank branches represent approximately 6% of the Italian banking system's assets, but they are set to grow with the potential entry of Swiss banks into the national landscape. Opening a bank branch in Italy means being able to offer a comprehensive offering, from wealth management to traditional banking services, with the same level of proximity as domestic institutions. A stable presence facilitates customer retention and enables competition in a high-potential market, where customers expect increasingly integrated and personalised services. Swiss players are already taking action, evaluating, where they already operate as investment firms, how to evolve into a bank structure in order to comply with the new regulations and respond more effectively to customer needs.

Specifically, what are the main implications for non-EU banks that decide to open a branch in Italy?
The challenge is not limited to the scope of services offered. It requires rethinking operating models to reconcile two seemingly opposing approaches: on the one hand, the centralisation of core systems to maximise efficiency and economies of scale, and on the other, the localisation of processes, data, and reporting to comply with Italian regulations regarding taxation, compliance, and customer transparency. Therefore, simply replicating the parent company's model in Italy is not enough: a layer of localisation is needed to translate global flows into processes compliant with the national regulatory framework. This is where scalable technological infrastructures and governance solutions come into play, allowing for operational control without duplication and inefficiencies.

How can they comply with Italian and European regulations without making mistakes?
Not all operators are fully aware of the implications of this transition: from the type of regulatory reporting to be produced, to the tax calculations to be applied, to the disclosure requirements to be met. Therefore, it may be optimal to rely on a partner who combines technological strength and domain expertise, capable of guiding the transformation by integrating robust platforms with in-depth regulatory and tax expertise.

But what are the main aspects to take into consideration?
The real battle is played in the back office. This is where the ability to ensure adequate management of transaction flows, the correct application of tax rules, timely regulatory reporting, and transparency towards customers is measured. For this reason, a glocal infrastructure is needed that combines globalisation and localisation throughout the entire operational cycle.

Only a back office conceived as a modular and integrated platform becomes a true competitive advantage, fostering sustainable growth and business resilience. Relying on a strategic partner with technological and regulatory expertise is the way to reduce complexity, transform it into a competitive advantage, and gain greater market share in the Italian market.

Read the original article here.