The case
The Swiss financial regulator FINMA should be given increased powers to make sure it would be able to deal with a failure of UBS if that scenario were ever to play out, the Financial Stability Board (FSB) has said last week. For more see link
Source: FSB Press Release 29 February 2024
The commentary
One step towards achieving this would be to “increase FINMA’s resources for supervision, recovery and resolution”, according to the FSB. The FSB’s comments echo calls from Swiss politicians and FINMA itself to strengthen supervision in the wake of the Credit Suisse crisis. Switzerland is essentially the only top banking centre that does not allow the regulator to impose fines on institutions for misconduct. The government has spoken out in favour of giving FINMA this power and wants to revise the rules for the resolution of financial institutions. However, all reforms must be harmonised with the goal of keeping Switzerland an attractive location for financial service providers.
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