FINMA published the 2020 Risk Monitor, which identifies the key risks facing the supervised institutions in Switzerland and describes the resulting focus of its supervisory activity. This version of Risk Monitor also discusses risks associated with the use of big data in the insurance sector. The Risk Monitor shows elevation of certain risks and identifies the new key risk of impending defaults or corrections in corporate loans and bonds abroad, in relation to the assessment of risks driven by the ongoing COVID-19 pandemic.
In addition, FINMA believes that the following risks that were identified as principal risks in 2019 still remain in focus for the supervised institutions and the Swiss financial center:
- Persistent low interest-rate environment (increasing)
- Possible correction on the real estate and mortgage market (increasing)
- Disorderly abolition of LIBOR benchmark interest rates (decreasing)
- Cyber-attacks (increasing)
- Money laundering (same)
- Increased impediments to cross-border market access (same)
Other long-term risks identified by FINMA include demographic aging, declining financial instrument valuations in asset management, and financial risks arising from climate change. In the 2020 Risk Monitor, FINMA also outlines how it has continued to pursue its agenda for climate risk mitigation since last year.
Keywords: Europe, Switzerland, Banking, Insurance, Risk Monitor, Big Data, Climate Change Risk, COVID-19, Cyber Risk, Insurtech, FINMA
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