At FINMA’s Small Bank Symposium, Swiss Financial Market Supervisory Authority CEO Stefan Walter outlined how the regulator adjusts supervisory intensity according to an institution’s systemic importance and risk profile. He said FINMA primarily supervises smaller, lower-risk institutions through data analysis and steps up scrutiny when risks or anomalies emerge. In 2025, institutions with medium or high risk ratings underwent 12 times as many on-site inspections as low-risk firms, while a small bank typically faces an inspection once every eight to 10 years. The voluntary small banks regime provides regulatory relief to particularly liquid and well-capitalized banks and securities firms in categories 4 and 5, with 56 institutions currently participating. Exemptions include calculating risk-weighted assets and complying with the net stable funding ratio, alongside simplified requirements for risk management, internal audit and disclosure. Proportionality does not reduce standards where institution size does not materially change the risk, including money laundering, market conduct and sanctions. Small institutions also remain responsible for managing cyber, outsourcing and service-provider concentration risks, even where their controls differ from those of larger banks.

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