Switzerland’s Financial Market Supervisory Authority (FINMA) and Swiss National Bank (SNB) released a joint statement in response to the recent market turmoil caused by certain banks in the U.S.
What Happened: The statement confirmed the problems faced by U.S. banks do not pose a direct risk of contagion for Swiss financial markets.
It also highlighted that the strict capital and liquidity requirements applicable to Swiss financial institutions ensure their stability.
Credit Suisse CS, one of Switzerland’s largest banks, meets the capital and liquidity requirements imposed on systemically important banks, and if necessary, the SNB will provide them with liquidity.
The regulation in Switzerland requires all banks to maintain capital and liquidity buffers that meet or exceed the minimum requirements of the Basel standards.
Systemically important banks, such as Credit Suisse, have to meet higher capital and liquidity requirements, which allows them to absorb the negative effects of major crises and shocks.
Although Credit Suisse has been particularly affected by market reactions in recent days, the statement confirmed the bank met the higher capital and liquidity requirements applicable to systemically important banks.
FINMA is in very close contact with the bank and has access to all information relevant to supervisory law. In addition, the SNB will provide liquidity to the globally active bank, if necessary.
Why It Matters: FINMA and the SNB are following developments and are in close contact with the Federal Department of Finance to ensure financial stability. The joint statement aims to calm any concerns about the impact of the recent market turmoil on Swiss financial markets.
Switzerland has a reputation for having a strong and stable banking system, and the statement reaffirmed the country’s commitment to ensuring financial stability. With the strict regulation and oversight provided by FINMA and the SNB, Swiss financial institutions are well-equipped to weather any major crises and shocks that may arise.
This content has been edited using AI tools and was reviewed and published by Benzinga editors.