On 1 November 2012 the Swiss Financial Market Supervisory Authority FINMA will replace the existing Bank Bankruptcy Ordinance with the new Banking Insolvency Ordinance. The new ordinance combines the implementing provisions governing the restructuring and bankruptcy procedure for banks and securities dealers into a single decree. It rounds out the Swiss legislation on insolvency and crisis prevention and meets the international requirements.
FINMA received a substantial amount of feedback during consultation on the Banking Insolvency Ordinance (BIO-FINMA). On the whole the consultation draft met with a positive response. In order to take account of critical responses and suggestions for improvements as well as international developments, FINMA has modified the consultation draft for BIO-FINMA.
BIO-FINMA now contains detailed regulations on the restructuring process, while the bankruptcy provisions have been adopted practically unchanged from the existing Bank Bankruptcy Ordinance (BBO-FINMA). The aim of BIO-FINMA is to make the restructuring and bankruptcy process both rapid and effective, to take proper account of individual cases, and to preserve legal certainty. The new ordinance contains detailed regulations on the restructuring powers that have been available to FINMA since the revised Banking Act came into force on 1 September 2011. In particular, instead of restructuring an entire bank FINMA has the option to ensure the continuation of individual core banking services, to convert debt capital into equity capital, and to prescribe other corporate actions.
More detailed information can be found in the BIO-FINMA factsheet.
Tobias Lux, Spokesperson, Tel. +41 (0)31 327 91 71, email@example.com