Switzerland's financial regulator, FINMA, has announced that it will regularly review its oversight of UBS, the country's largest bank, as part of an effort to strengthen the banking sector's resilience.

Regulatory Reforms

Regulatory reforms were implemented following the collapse of Credit Suisse and its subsequent acquisition by UBS. FINMA aims to enhance supervision of financial institutions, particularly those deemed systemically important. The regulator plans to refine its supervisory approach to UBS to effectively manage the risks associated with the bank's systemic importance.

Proactive Supervisory Framework

FINMA has previously used various supervisory tools, such as on-site inspections and stress tests, but with UBS's increased size and influence, a more proactive and responsive supervisory framework is needed.

Tightening Regulations

The Swiss government is also working on proposals to tighten regulations in the banking sector, including enhancing FINMA's powers. FINMA has called for UBS to improve its emergency and recovery plans to ensure financial stability. The regulatory landscape for Swiss banks is expected to change based on the findings of a parliamentary report on the handling of the Credit Suisse crisis.

Creating a Resilient Banking Sector

The goal is to create a more resilient banking sector that can withstand future shocks. Stakeholders in the financial sector will closely monitor the developments and implications of these regulatory reforms.