Mergers of banks and securities firms

Banks and securities firms must meet specific regulatory requirements when they merge with each other.

Banks and securities firms must inform FINMA appropriately and in good time if they are planning a merger. Under certain conditions, the institutions must also request special authorisations and supply the requisite documentation.

Information for FINMA

As a rule, FINMA needs the following information to assess planned mergers from a regulatory perspective:

  • purpose and reasons for the merger;
  • integration of the acquired institution and any subsidiaries and foreign businesses into the acquiring institution’s structures and processes (including organisation chart);
  • any staff changes;
  • outsourcing agreements to be maintained, adapted or terminated;
  • any changes to or migrations of IT infrastructure;
  • timetable for the merger up to full operational integration.

Documents for FINMA

As a rule, the merging banks or securities firms must provide the following documents:

  • merger agreement and balance sheet;
  • public records of the merger decisions, including articles of association and also decisions on capital increases where applicable;
  • merger reports;
  • amended regulations of the acquiring institution bearing a legally valid signature insofar as these require authorisation.

The regulatory audit firms of the merging banks or securities firms must supply the following:

  • audit report on the merger agreement and merger report
  • confirmation that:
  1. the acquiring institution can continue to comply in full with all licence conditions after the merger;
  2. the planned internal organisation is compatible with the planned business, and
  3. there are no objections to the acquired institution’s deletion from the Commercial Register.

Creditor protection measures

Article 25 para. 2 of the Merger Act states that the merging banks or securities firms must publish their plans several times to protect their creditors’ claims. Their regulatory audit firms must confirm to FINMA by the prescribed deadline that

  • the required publications have taken place;
  • where creditors and investors have asked for claims to be guaranteed, the bank or institution has guaranteed them or proved that they will not be endangered after the merger;
  • and all of the acquired institution’s assets and liabilities will be transferred in full to the acquiring institution’s balance sheet at their book value in line with the applicable accounting principles.