Switzerland’s financial regulator, FINMA, has announced its strategic goals for 2025 to 2028, which include enhancing supervision of institutions and developing their governance and risk culture. This comes as the country prepares to overhaul regulations to make the banking sector more robust.
One of the key areas of focus for FINMA will be UBS, the country’s largest bank, which has recently taken over its long-time rival Credit Suisse. FINMA has stated that it will regularly review its supervisory approach for UBS and refine it as necessary to counter the risks associated with its systemic importance.
The Swiss government has proposed a series of measures to tighten banking regulations following the collapse of Credit Suisse in 2023 and its subsequent takeover by UBS. These proposals include giving FINMA extra powers, but the extent of these powers is yet to be determined and is expected to be announced in the first half of 2025.
FINMA has also emphasized the need for UBS and the country’s other systemically important banks – Raiffeisen Group, PostFinance, and Zuercher Kantonalbank – to have emergency and recovery plans in place to ensure they can be wound down or sold without jeopardizing financial stability and taxpayer money.
The government has stated that it will take into account the findings of a parliamentary report into the handling of the Credit Suisse crisis when determining the new banking regulations. This report is expected to be published in the next few weeks.
Overall, these developments highlight the importance of strengthening the oversight of the banking sector in Switzerland, particularly in light of the recent crisis at Credit Suisse. The proposed measures aim to ensure that banks are better equipped to handle potential risks and that the financial stability of the country is not compromised.