The CEP wants to give more power to FINMA. According to her, supervision of the review of large banks should be centralized under the authority of the Financial Market Supervisory Authority. The latter should also be able to effectively enforce its enforcement procedures (law enforcement). It should be able to communicate in principle on each enforcement procedure against systemically important banks. FINMA should also be able to impose fines on large banks and order them to carry out early capital planning.
FINMA and the Review Supervisory Authority (ASR) must also intensify and improve their collaboration and exchange of information. It is also necessary to clarify the concept of “creditor protection” and when FINMA must contact the Competition Commission (COMCO).
The Federal Council is responsible for adapting the legal basis so that the SNB has the authority to impose preparatory measures on systemically important banks for possible recourse to extraordinary liquidity assistance.
■ Anticipation of crises, communication between competent authorities
The CEP considers it necessary to improve the exchange of information between the different bodies. The Federal Department of Finance (FDF) and the Swiss National Bank (SNB) must proactively inform each other about important developments relating to systemically important banks and their impact on financial stability.
For cases that concern several authorities, the responsibilities of the different actors must also be clearly defined and a main contact must be designated for contacts with external actors. When transferring power to the Federal Council, the process must go beyond a checklist.
The Federal Council must increase transparency and understanding of the inspections carried out by the Audit Supervisory Authority (ASR) of systemically important banks. The CEP calls for more dynamic inspections, both in terms of frequency and scope. The ASR must rigorously verify the implementation of corrective measures.
The body headed by national advisor Isabelle Chassot also advocates improvements to detect crises as early as possible, in particular by strengthening the role of the Conference of Secretaries General (CSG), the body which primarily assumes management responsibility. risks.
■ Regulation of “too big to fail” (TBTF) banks
Relief from capital and liquidity requirements for large banks should be limited. The Federal Council is asked to examine whether the quality and quantity of the capital of systemically important banks are, in accordance with current requirements, sufficiently protected to ensure the soundness of systemically important banks.
TBTF legislation is too focused on Switzerland, according to the CEP. In future regulations, the Federal Council is invited to take into account the international dependencies of systemically important banks. The CEP also asks the Federal Council to examine what measures are necessary so that the remuneration systems of large banks and the dividends they pay do not induce harmful incentives.
