In remarks at the Small Bank Symposium in Bern, Swiss Financial Market Supervisory Authority CEO Stefan Walter outlined how FINMA applies proportionality by directing supervisory resources toward institutions and activities presenting greater risk. He emphasized that smaller institutions with lower inherent risk are supervised mainly through data, with oversight increasing when risks or anomalies emerge. FINMA conducts more than 40 on-site inspections at UBS each year, while a small bank undergoes one on average every eight to 10 years. In 2025, institutions with medium or high risk ratings received 12 times as many inspections as those rated low risk. Proportionality also underpins the voluntary small banks regime, under which 56 well-capitalized and highly liquid category 4 and 5 banks and securities firms receive quantitative and qualitative relief, including exemptions from calculating risk-weighted assets and the net stable funding ratio. Walter stressed that proportionality does not justify weaker standards where institution size does not materially reduce risk, including for money laundering, market conduct and sanctions compliance. Small banks also remain responsible for managing cyber and outsourcing risks, including dependencies on technology and cloud providers, even where their controls and structures differ from those of larger institutions.

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