Systemically important banks

Financial groups and banks are systemically important if their failure would cause significant harm to the Swiss economy and financial system. A bank’s systemic importance depends on its size, interlinkages with the financial system and economy and the substitutability of the services provided by the bank in the short term. The systemically important functions include the domestic deposit-taking, lending and payments business. 

After consulting FINMA, the Swiss National Bank (SNB) designates a bank as systemically important and indicates which of its functions are systemically important. Following the merger of Credit Suisse with UBS, there are still four systemically important banks in Switzerland: UBS, the Raiffeisen Group, Zürcher Kantonalbank (ZKB) and PostFinance.

Systemically important banks must fulfil special statutory requirements to strengthen their resilience to crises. Higher capital and liquidity requirements make banks more stable (see “Capital requirements for systemically important banks”). Preparations for recovery and resolution need to be made for these banks in “normal” times (see “Recovery and resolution planning for banks”). They are therefore obliged to prepare a recovery plan. This must show how they can stabilise themselves through their own efforts when in distress. In an emergency plan, the banks must also demonstrate to FINMA each year that and how their systemically important functions could continue uninterrupted in the event of a restructuring (see the current assessment).