‘Too Big to Fail’ risk acceptable at largest Swiss cantonal bank
Zurich Cantonal Bank is no longer a risk to the Swiss economy.
KEYSTONE
The Swiss financial regulator has approved plans by the country’s largest cantonal bank to wind up in an orderly manner should it go bust. Large-scale banks must satisfy the regulator that their insolvency would not significantly damage the economy.
Do you want to read our weekly top stories? Subscribe here.
The Swiss Financial Market Supervisory Authority, FINMA, declared itself satisfied with Zurich Cantonal Bank’s (ZKB) emergency plan. The bank issued the necessary additional loss-absorbing funds in the form of loss-bearing bonds in 2023, according to the communiqué. The other requirements had already been met.
According to FINMA, Postfinance, on the other hand, still does not meet the requirements for additional loss-absorbing funds. In the meantime, however, it has submitted a binding plan to build up these funds.
There is no change in the assessment of Raiffeisen’s emergency plan – already judged to be feasible last year.
The new UBS has not yet been assessed. The bank has said it will revise its crisis preparedness due to the takeover and integration of Credit Suisse. UBS will then submit its plans for restructuring and liquidation, plus stabilisation and emergency planning, to FINMA. The regulator will examine these measures and make a separate decision later.
Systemically important banks must submit an emergency plan to FINMA every year for assessment. They must show how the systemically relevant functions could be continued in the event of a risk of insolvency.
At Raiffeisen and ZKB, systemically important functions are the short-term lending business. At all three banks – including Postfinance – deposit business and payment transactions are considered systemically important.
This news story has been written and carefully fact-checked by an external editorial team. At SWI swissinfo.ch we select the most relevant news for an international audience and use automatic translation tools such as DeepL to translate it into English. Providing you with automatically translated news gives us the time to write more in-depth articles.
If you want to know more about how we work, have a look here, and if you have feedback on this news story please write to english@swissinfo.ch.
Train vs plane: would you take a direct train between London and Geneva?
Eurostar is planning to run direct trains from Britain to Germany and Switzerland from the early 2030s. Would you favour the train over the plane? If not, why not?
Man charged with flying drone at women’s Euro 2025
This content was published on
A man flew a drone around the venue on Wednesday evening during the first match of the Women's EURO 2025 in St. Gallen. The 30-year-old violated the absolute ban on flying during match days. He was reported to the police.
More than 250 Swiss companies sign CO2 reduction initiative
This content was published on
A total of 257 companies from Switzerland have signed up to the Science Based Targets Initiative (SBTi). In doing so, they are committing to CO2 reduction targets that are compatible with the Paris Climate Agreement.
Swiss accident prevention group sees federal targets at risk
This content was published on
The Swiss government's target for accident figures is at risk, reckons Mario Cavegn, member of the executive board of the Swiss Council for Accident Prevention.
Feminicide: Swiss justice minister calls for electronic monitoring
This content was published on
Swiss Justice Minister Beat Jans has called for electronic monitoring and an ankle bracelet warning system for perpetrators of violence against women.
This content was published on
American artist Chaka Khan ‘and friends’ opened the 59th Montreux Jazz Festival on Friday. For over three hours, their show, dedicated to their friend and mentor Quincy Jones, thrilled the audience,
You can find an overview of ongoing debates with our journalists here . Please join us!
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.