Swiss financial watchdog demands more powers

FINMA has said on several occasions that it needs more resources to force financial and insurance players to comply with the rules. Keystone-SDA

The Swiss Financial Market Supervisory Authority (FINMA) is calling for legal changes to enable it to intervene early on if banks violate corporate governance rules.

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FINMA told reporters on Tuesday that it wants to be able to intervene “when the board of directors and management of an institution do not consistently reflect (…) its core values and risk culture”, referring to the shortcomings that led to the collapse of Credit Suisse.

The financial watchdog also wants to be able to communicate on its supervisory activities, introduce a liability regime for executives and impose fines if necessary, it said in a statement on Tuesday on the sidelines of its annual press conference.

FINMA says it needs more resources to force financial and insurance players to comply with the rules.

But to so so requires an appropriate legislative framework. “It does not simply want to issue more rules, but to be able to be more consistent in the event of a breach of the existing rules,” said FINMA chair Marlene Amstad. The new coercive instruments would thus have a preventive effect.

In its 2024 annual report, FINMA said last year it carried out 111 on-site inspections of banks, 55 of insurers and 20 in the asset management sector.

It also carried out stress tests, in particular of the mortgage portfolio and risks related to the interest business, and checked financial resilience.

+ FINMA director expects cooperation and transparency from banks

As part of its enforcement activities, FINMA carried out 73 inspections and completed 38 investigations against companies and individuals.

The Swiss bank UBS, which is still in the process of integrating its former subsidiary Credit Suisse, is under particular scrutiny by FINMA, which carried out around 40 on-site inspections in Switzerland and abroad.

The risk of cyber attacks has also risen sharply, with reports of such attacks jumping by 30% in 2024.

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Translated from French by DeepL/sb

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