FINMA published guidance (06/2020) on extending or discontinuing various exemptions that were granted due to the COVID-19 crisis. The guidance also offers additional details on the handling of duration for loans procured as part of the SNB COVID-19 refinancing facility (CRF) for calculating the net stable funding ratio (NSFR).
Clients continue to hold unusually large deposits with Swiss banks. Therefore, FINMA is extending the exemption for the calculation of the leverage ratio (exclusion of central bank reserves) for all banks until January 01, 2021 (from July 01, 2020). In case of dividend distributions, the reduction in the relief described in FINMA Supervisory Notice 03/2020 continues to apply. FINMA does not plan to continue with this treatment as a temporary relief after this extension of the deadline. Also, relief in the area of risk diversification will not continue due to lack of demand and will end on July 01, 2020. However, institutions can request specific exemptions in individual cases. The exemption concerning market risks is to be incorporated into future supervisory practice. Additionally, exemptions granted by FINMA in the area of anti-money laundering, for the opening of new client relationships, will be extended for specific situations, in particular for foreign clients, to return gradually to the normal opening procedure.
Keywords: Europe, Switzerland, Banking, COVID-19, Leverage Ratio, NSFR, Dividend Distribution, Credit Risk, Market Risk, FINMA
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