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Swiss Banking Act Revision 2026: The Key Points
- On 12 August 2026, the Federal Council opened the consultation on amendments to the Banking Act and the Liquidity Ordinance. It runs until 19 November 2026.
- Banks with at least 250 employees would have to allocate senior-management responsibilities in writing and at an individual level.
- New compensation principles are proposed for all banks; systemically important banks would also face deferral periods and clawback rules.
- FINMA would gain stronger early-intervention powers, including periodic penalty payments and fines against institutions, and would generally publish concluded enforcement proceedings.
- Resolution, crisis planning, depositor protection and access to Swiss National Bank liquidity support would be further developed.
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From the Credit Suisse Crisis to Legislative Reform
The collapse of Credit Suisse in March 2023 and its emergency takeover by UBS exposed weaknesses in the existing too-big-to-fail framework. The Federal Council analysed those gaps in its report on banking stability and adopted a package of measures on 6 June 2025. Parliament’s Investigation Commission (PUK) made additional recommendations, particularly on the individual accountability of bank managers and the supervisory authority’s powers to intervene.
The consultation draft now on the table – often referred to as “Too-Big-to-Fail Regulation II” – translates those measures into formal amendments to the Banking Act and the Liquidity Ordinance. Its stated purpose is to reduce risks for the state, taxpayers and the economy.
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Accountability and Corporate Governance
Banks with at least 250 employees would have to record in writing which person is responsible for each decision and area of responsibility. An individual fit-and-proper obligation is proposed for key functions, including internal audit, risk control, compliance, operations, finance, IT and material business units. The individuals concerned would confirm their responsibilities in a signed declaration.
This places documented individual accountability of senior managers at the centre of Swiss banking law. The approach resembles the UK Senior Managers Regime but remains embedded in the Swiss supervisory framework. FINMA could also subject smaller banks to the regime on a case-by-case basis, particularly where corporate-governance deficiencies exist.
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New Compensation Rules and Clawbacks
General principles would apply to all banks to prevent misaligned incentives in compensation systems and promote the institution’s long-term development. Breaches of duties of care could be addressed through reductions in variable compensation or disciplinary measures.
Stricter requirements are proposed for the most senior or highly compensated executives of systemically important banks: deferral periods for variable compensation and clawback provisions allowing bonuses already paid to be recovered where misconduct is subsequently established.
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Expanded FINMA Powers
FINMA would be able to intervene earlier and more effectively when risks become apparent, before an institution’s financial position deteriorates or client interests are put at risk. Its toolkit would notably be expanded to include periodic penalty payments for delayed implementation of enforceable orders and the power to impose fines on legal entities and partnerships.
FINMA would also generally inform the public about concluded enforcement proceedings. For supervised institutions, this heightens the importance of clear accountability, robust escalation paths and traceable documentation.
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Resolution, Liquidity and Depositor Protection
The existing “restructuring proceedings” concept would be replaced by a broader “resolution procedure”. This would give FINMA several options: restructuring, continuation of essential services or an orderly market exit. Resolution planning would use parallel valuation approaches – going-concern value, resolution value and liquidation value – to be determined by independent valuators under FINMA supervision.
The draft also creates a statutory basis for transfers of assets to special-purpose vehicles, sales of businesses through bidding processes and transitional institutions or “bridge banks”. Simplified collateral transfers are intended to accelerate access to Swiss National Bank liquidity assistance in a crisis. Privileged deposits and payout procedures would also be further developed.
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Which Banks Are Affected?
The tightened obligations concerning compensation, resolution planning and valuation are directed primarily at systemically important banks. The governance and accountability rules would apply more broadly to banks with at least 250 employees. Smaller institutions are generally not caught by the strictest requirements, such as the clawback rules for executives, but would still have to observe the general compensation principles.
The draft is designed proportionately. Even so, its core principles are likely to influence supervisory practice and expectations of sound governance beyond its immediate scope.
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Timeline for the 2026 Swiss Banking Act Revision
The consultation runs from 12 August to 19 November 2026. The Federal Council then intends to prepare its dispatch on the Banking Act for Parliament. Under the current timetable, the statutory amendments could enter into force no earlier than the beginning of 2029. The proposed Liquidity Ordinance requirements are to be coordinated with the legislation and are intended to apply from 2033.
The draft may still change during the parliamentary process and before final adoption. Institutions should therefore distinguish between the current consultation draft, the later legislative decision and the subsequent implementation phase.
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What Compliance and Risk Officers Should Review Now
Although the draft is primarily aimed at systemically important and larger banks, its direction is relevant to all financial intermediaries: documented individual accountability, duties of care backed by sanctions and risk-based early intervention. Reviewing responsibilities, escalation procedures, variable compensation and crisis scenarios now provides a solid basis for later implementation.
The governance issues overlap with other current supervisory topics, including how banks address digital fraud risks and FINMA’s expectations for money-laundering risk analyses.
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Frequently Asked Questions
What is “Too-Big-to-Fail Regulation II”?
It refers to the 2026 consultation on revisions to the Banking Act and the Liquidity Ordinance, intended to implement lessons from the Credit Suisse crisis and the PUK report in legislation.
Which banks are affected by the new governance requirements?
As a rule, banks with at least 250 employees. FINMA could also subject smaller banks to the regime in individual cases, particularly where governance deficiencies exist.
What changes for bank executive compensation?
General principles against misaligned incentives are proposed for all banks. For specified executives of systemically important banks, deferral periods and clawback rules would apply in addition.
What new powers would FINMA receive?
FINMA would be able to intervene earlier, impose periodic penalty payments and fines, and generally inform the public about concluded enforcement proceedings.
When could the revision enter into force?
The consultation runs until 19 November 2026. Under the current timetable, entry into force would be possible no earlier than the beginning of 2029.
Note: This article summarises a consultation draft that remains part of an ongoing political process and may change. It does not constitute legal advice.
Primary sources