Small banks regime comes into force / Small Bank Symposium

The small banks regime exempts Category 4 and 5 banks that fulfil qualified requirements from certain supervisory requirements. FINMA approved 64 institutions to participate in the regime when it came into force on 1 January 2020.

The high degree of interest in the small banks regime shows that this further reinforcement of the risk-based supervision of smaller institutions meets a genuine need. FINMA expects that the institutions covered by the small banks regime will save costs in the medium term because of the exemptions and relief relating to quantitative and qualitative requirements. They will do so, for example, thanks to the waiver on calculating risk-weighted assets and the structural liquidity ratio, or due to reduced requirements in the course of implementing future regulatory amendments. Strict compliance with the authorisation criteria continues to guarantee the soundness of the Swiss financial centre.

The completion of the successful, rapid development phase of the small banks regime was addressed in depth at the third Small Bank Symposium in January 2020. FINMA’s annual meeting with the representatives of Category 4 and 5 banks was also a valuable opportunity for a lively exchange of views with the participants on the potential risks to the Swiss financial centre from the perspective of the small banks.

(From the Annual Report 2020)