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FINMA publishes "Liquidity – insurers" circular

On 1 January 2013, the Swiss Financial Market Supervisory Authority FINMA is putting a new circular on cash flow reporting for insurers into effect.

Alongside capital management, liquidity management provides a holistic view of capital strength and is a central element of corporate governance in financial institutions. Liquidity reporting enables a company to meet its payment obligations in full and on time. In this circular, FINMA specifies the supervisory provisions for risk management by setting out principles on cash flow reporting for insurers. Through these regulations FINMA can raise insurers' awareness of liquidity risks enabling them to formulate their liquidity requirements at a later stage.

The consultation on the "Liquidity – insurers" circular stirred relatively little interest and FINMA only received a small number of responses. The consultation draft was generally favourably received. Apart from some small formal adjustments, FINMA made certain substantive changes to the consultation draft based on the comments received: for instance, the deadline for the first submission of the report has been postponed to 30 September 2013. Starting in 2014, the companies, insurance groups and conglomerates affected must submit a report by 30 April of the year in question.

Contact
Tobias Lux, Media Spokesperson, phone +41 (0)31 327 91 71, tobias.lux@finma.ch