In its new 2025 Risk Monitor, FINMA reveals where it sees the greatest risks for the Swiss financial centre. It warns of an increase in geopolitical and technological risks and calls for more robust controls over the outsourcing of critical functions. The climate risk report is also part of the Risk Monitor for the first time.
FINMA today publishes its 2025 Risk Monitor, in which it highlights the risks that are particularly relevant for institutions and the financial market from a supervisory perspective. It explains what it will be focusing on in its supervisory activities as a result. The risk landscape has intensified further since the last publication in 2024, both in the financial and non-financial areas.
The macroeconomic and geopolitical environment remain challenging in 2025. After a period of falling inflation, prices rose modestly again in several countries. At the same time, trade policy tensions are dampening the economic outlook. Government debt is increasing in some important countries. The geopolitical situation remains tense. Sanctions also continue to pose a risk. These developments contribute to the fact that existing risks remain high or are even increasing in certain areas. As digitalisation progresses, cyber risks in particular continue to grow.
Nine principal financial risks
FINMA identifies nine principal risks that it categorises as high. The financial risks are: risks in connection with real estate and mortgages, credit risks associated with other loans, credit spread risks as well as liquidity and funding risks. The non-financial risks are: risks in the area of combating money laundering, sanctions risks, outsourcing risks, risks resulting from cyberattacks and ICT risks due to the complexity of the systems, software errors and outdated systems.
FINMA’s CEO Stefan Walter says: ‘The current risk landscape is increasingly complex. Besides financial risks, non-financial risks such as cyberattacks and sanctions are gaining in importance. In this risk landscape, a strong risk culture and governance are crucial for the resilience of institutions. Forward-looking, risk-based supervision also remains essential to ensure the stability and credibility of the Swiss financial centre. With regard to systemically important institutions, the planned reform of the “too big to fail” regulation will also make a significant contribution in this context.’
Real estate and mortgage risks remain high
FINMA continues to observe increased vulnerabilities in the mortgage sector. Real estate prices have risen again in the low interest rate environment. In particular, price trends for investment properties and holiday apartments show regional indications of overheating. Per capita mortgage debt is at one of the highest levels in the world. Due to their business model, retail banks in particular are exposed to considerable risks in the event of price corrections. At the same time, it is apparent that many institutions are interpreting their affordability criteria too generously and are increasingly granting loans outside their own guidelines. FINMA will continue to closely monitor this practice and impose targeted supervisory measures or additional capital charges where necessary. FINMA also sees a need for regulatory improvements in this area. In addition, life insurers and pension funds have increased their real estate investments in the low interest rate environment, which makes them more sensitive to price corrections on the real estate market. With a view to the medium- to long-term development of real estate prices, demand for loans and the risk profiles of financial institutions, FINMA will closely monitor the potential impact of the decision to reform the taxation system for residential property and demographic change.
Cyber and ICT risks continue to grow
Cyberattacks on financial institutions and their service providers saw another significant increase last year. Almost half of all reported incidents involved third parties, which emphasises the growing dependence on a few central service providers. FINMA sees an ongoing high operational risk here and is increasingly scrutinising the institutions’ protection measures. The risks in the area of information and communications technology (ICT) that are not attributable to cyberattacks are also continuing to rise: Due to increasingly complex IT systems, program errors and outdated software can have ever more far-reaching consequences. FINMA expects institutions to strengthen their technological resilience in a targeted manner so that the system can continue to operate even if individual components fail.
Climate risk report part of the FINMA Risk Monitor for the first time
The Risk Monitor contains FINMA’s climate risk report for the first time, which it is publishing to fulfil its obligations under the CO₂ Act. In this report, FINMA presents the current situation regarding climate risks at Swiss financial institutions, how the institutions are dealing with them and what measures FINMA itself is taking. It concludes that the risks posed by climate change – both through changes in the economy, known as transition risks, and through direct impacts such as natural catastrophes – will increase in the future. Financial institutions are working on integrating these risks into their overall risk management.
In the 2025 Risk Monitor, FINMA reveals where it sees a need for action and how it addresses risks at an early stage in order to ensure the resilience of the Swiss financial centre in the long term.
