FOREWORD BY THE CHAIR AND THE CEO
Heightened resilience and greater proportionality – the way forward
Ten years ago, the financial system stood on the brink of collapse. Since then, much has been undertaken and achieved to place financial institutions and markets on a firmer footing. One such achievement is the Basel III standards, which were finalised in 2017.
It was in 2007 that the initial fault lines in the finan- industry. Our duty as supervisor is to identify these cial system started appearing. The rifts that followed risks and limit any fallout they may have on clients almost led to the collapse of financial markets and na- and the functioning of the financial markets. tional economies. A key lesson from the crisis is that financial institutions were inadequately capitalised. The Swiss property market is a particular source of risk Since then, the capital position of banks – especially at the moment, especially in the investment property that of global players – has been strengthened con- segment, as a consequence of its unbroken growth. siderably. An important milestone was reached in 2017 Persistently low interest rates are driving an increaswhen the Basel III reforms were finalised, thus essen- ing number of investors into this market segment in tially completing the global regulatory response to the search of better returns. Whether the pace of growth can continue is doubtful. The prices of buy-to-let propfinancial crisis of 2007 and 2008. erties recently spiked to another all-time high. The Institutions need this heightened resilience because combination of increasing prices, falling rents, rising significant risks continue to surround the financial vacancy rates and decreasing immigration is concern-