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Updated December 31st, 2023 at 23:07 IST

Swiss financial regulator explores possibility of retrieving bankers' bonuses

The ability to publicise FINMA's actions would enhance transparency and accountability, providing a more effective deterrent.

Business Desk
Switzerland
Switzerland | Image:Pexels
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Switzerland's financial regulatory body, FINMA, is advocating for discussions on the possibility of clawing back bankers' bonuses, seeking enhanced powers in the aftermath of Credit Suisse's downfall and acquisition by UBS. 

Marlene Amstad, Chairwoman of FINMA, stressed on the need for a robust legal foundation that enables the regulator to intervene more proactively and systematically, referencing Credit Suisse's history of sustaining losses while disbursing substantial bonuses.

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In response to criticisms of its response to Credit Suisse's challenges before the bank's crash in March, FINMA is pursuing increased regulatory authority. 

The proposed powers include the ability to impose fines, disclose details of enforcement proceedings, and establish a framework delineating specific responsibilities for senior executives, aligning with a model adopted in the UK.

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Amstad highlighted the necessity for fines and proper incentives in remuneration within the financial sector, stressing upon the role of money in financial dealings.

The ability to publicise FINMA's actions would enhance transparency and accountability, providing a more effective deterrent.

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Addressing the unique Swiss requirement for confidentiality in regulatory measures, Amstad stressed the importance of informing market participants and the public about regulatory actions. 

FINMA's aspiration to influence remuneration models at banks is not about determining wages but ensuring regulatory tools to intervene in the compensation system effectively.

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The call for discussions on clawing back bonuses and seeking expanded regulatory powers reflects the evolving landscape of financial oversight in Switzerland, aiming for a more proactive and transparent approach to prevent systemic issues in the future.

(With Reuters Inputs)

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Published December 31st, 2023 at 12:57 IST

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