The Swiss Financial Market Supervisory Authority FINMA publishes its 2019 Annual Report today. Besides the retrospective report, this also encompasses the annual financial statements. In addition, FINMA is providing data on enforcement cases in a database as well as statistics in an Excel document on its website for the first time from today.
“Switzerland needs stable financial institutions particularly in uncertain times for the financial markets.” This pronouncement was made in January by the Chair of FINMA’s Board of Directors Thomas Bauer and FINMA CEO Mark Branson when they wrote the introduction to the 2019 Annual Report. It was not then clear how soon times would become more uncertain than virtually ever before.
In 2019 FINMA focused its risk-oriented supervision particularly on how firms are coping with the risks arising from low or negative interest, specifically in the real estate market. It was also in close contact with the industry with regard to the risks relating to cyber attacks, Brexit and the transition from LIBOR. Furthermore, FINMA clarified a whole host of technical questions related to business models based on new uses of technology. In addition, ten years after the financial crisis FINMA confirmed that the emergency plans for the systemically relevant functions of the two major Swiss banks are now effective. Finally, FINMA considered how the topics of sustainability and risks posed by climate change are to be dealt with under supervisory law.
Enforcement: focus on initial coin offerings
In 2019, FINMA conducted 1,185 investigations (2018: 1,086) and 30 enforcement proceedings (2018: 42). Its Enforcement division looked closely at initial coin offerings (ICOs) in Switzerland in 2019. Overall, it carried out investigations into approximately 60 ICOs, of which more than half could be concluded. FINMA identified a breach of the Anti-Money Laundering Act (AMLA) at more than ten ICOs and brought charges against the responsible people. Eight further cases resulted in entries being made on FINMA’s warning list due to suspected illegal conduct. Enforcement proceedings were ultimately opened against three companies.
Annual financial statements: slightly higher costs due to special effects
FINMA’s operating costs have remained largely stable since 2012. At CHF 123 million, they were CHF 4 million higher in 2019 than in the previous year. This is due to particularly low costs in 2018 resulting from employee pension benefit adjustments. The operating costs were covered by income from supervisory fees and levies. The average number of full-time equivalent positions at the authority was 465 in 2019. This number has hardly changed since 2012.
Owing to the current situation related to coronavirus, FINMA is not holding an annual media conference this year. However, FINMA will continue to provide updates on relevant developments via its customary channels (website, @FINMA_media). FINMA undertook various initiatives in 2019 aimed at strengthening transparency. It launched a new forward-looking publication, the Risk Monitor, to keep the public informed about a central aspect of its supervision, namely the prioritisation of the risks faced by the financial sector. A wide-ranging report on the progress that has been achieved in recovery and resolution planning by the systemically important banks was also issued at the start of 2020. In addition, it is providing statistical information from the previous year as well as databases with enforcement rulings and court decisions relating to FINMA enforcement proceedings on its website.
Tobias Lux, Media Spokesperson
Tel. +41 (0)31 327 91 71
Vinzenz Mathys, Media Spokesperson
Tel. +41 (0)31 327 19 77