The Swiss banking sector is key in strengthening the swiss economy. Switzerland is well known for its diversified financial services, privacy and sophistication. Swiss banks are actively engaged in a range of activities, in relation with both the private and commercial domain. At present, Switzerland is one of the leading countries in private banking.
The Swiss central bank is regulated by the Swiss National Bank (SNB). The Union Bank of Switzerland and Credit Suisse are the two major banks in the country.
The Swiss regulatory system
Switzerland is not a member of the European Union, neither is it a participant of the European Economic common area. Therefore, it’s not bound by the European Legislation. This means that Switzerland has the autonomous and sovereign right to regulate its own financial services industry.
Legal forms of banking regulation in Switzerland
Banking regulatory legislation can be expressed in various legal forms. The fundamental principles in Switzerland are included in the federal legislation, while concrete details are set out by government ordinances. Federal legislation documents include:
- The Banking Act;
- The Stock Exchange Act;
- The Financial Market Supervision Act.
In addition to these regulations, there are other ordinances and circulars issued by the Swiss Financial Market Supervisory Authority (FINMA). These include self directory guidelines, directives and recommendations issued by the Swiss financial sector. It’s important to note that, the Swiss Bankers Association issues all these only under the supervision of FINMA.
Swiss Financial Market Supervisory Authority
FINMA is the major organization responsible for the regulation of banks and financial markets in Switzerland. FINMA works as an independent federal regulatory authority, employing a dualistic supervisory system to monitor and inspect the audit companies execute and the special inspections commissioned by the authority.
SIX Swiss Exchange
Certain aspects regarding securities brokering, such as the organization of trading, are subject to self – regulation through the SIX Swiss Exchanges engendered under the overall supervision of FINMA (through the Swiss Banking Association). The SIX Swiss Exchange also ensures compliance with the regulatory framework for securities insurance and trading, monitoring and enforcing compliance with these regulations.
Supervision of security dealers
FINMA’s supervisory activities draw heavily on the work of audit firms that are delegated to conduct regular audits in certain institution sectors. Thus it can provide direct supervision. The Supervision of Wealth Management Banks and Securities Dealers and the Supervision of Retail, Commercial and Trading Banks departments are responsible for monitoring security dealers, banks and other mortgage bond institutions.
Institutions that form an economic unit with other legal entities in the financial sector are also monitored on a constant basis as part of the supervision of financial services groups.
Corporate bank accounts
Any company can open a Swiss bank account, whether it has a registered office located in Switzerland or not.
Companies that conduct commercial, services and manufacturing activities are listed in the Swiss Commercial Register, therefore they must provide the bank with a relevant extract from the register.
Companies that are not listed in the Swiss Commercial Register or that don’t have a registered office in Switzerland must provide the bank with an extract from the Register of commerce or other equivalent documents, in order to allow the bank to identify the company. This is necessary so that the bank confirms the entity's existence and identifies its legal representatives. The same requirements apply to Swiss companies that don’t operate an official Register of commerce. In both cases, the documentation should not be older than 12 months at the time of submission.
Domiciliary companies are companies that don’t conduct any operational activities and don’t have any physical premises or personnel in Switzerland. They can be Swiss or foreign companies. These companies are entitled to declare the identity of the beneficial owners by submitting a special form (form A).
For more details and assistance regarding banking and finance in Switzerland, you can reach out to our expert consultants. Our highly experienced and well-informed team is ready to answer all your questions and give you all the help you might need.