– FINMA opens bankruptcy proceedings against FlowBank
The Financial Markets Supervisory Authority fears that the bank no longer has sufficient capital to carry out its activities.
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Published today at 2:46 p.m.
Charles-Henri Sabet, founder of the online bank FlowBank (archives).
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The Federal Financial Market Supervisory Authority (FINMA) initiated bankruptcy proceedings against online bank FlowBank on Thursday. This decision stems from the persistent violation of minimum capital requirements, raising fears of a possible situation of over-indebtedness, explains FINMA in a press release. Bankruptcy is primarily intended to protect depositors, with the promise that preferred deposits will be repaid in full from the bank’s available funds.
Since October 2021, FINMA had noted serious violations of supervisory regulations by FlowBank, including deficiencies in capital, risk management and organization. In response, FINMA implemented various measures and appointed auditors to supervise the bank. However, in June 2023, further breaches led to an in-depth investigation.
FlowBank’s financial situation worsened, with flagrant violations of capital requirements at the end of 2023 and April 2024. The bank failed to turn the situation around, leading FINMA to intervene to protect depositors and initiate bankruptcy proceedings.
FlowBank, based in Geneva and with subsidiaries in London and the Bahamas, manages around 680 million francs, more than 22,000 customer accounts and employs around 140 employees. The liquidator appointed by FINMA, Walder Wyss SA, will supervise the liquidation procedure and the return of client assets.
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