We would like to highlight the following with respect to liquidity and funding risks, risks resulting from AML and outsourcing risks:

1. Regarding liquidity and funding risks:

FINMA notes that the overall funding costs have risen. However, although a few market participants have seen the beginnings of a trend towards tighter credit availability, FINMA has not identified any funding crunch.

2. Regarding AML risks:

FINMA again identifies money-laundering risks as one of the most significant risks in the Swiss financial sector. While the report covers a broad spectrum of financial and operational risks, FINMA’s assessment highlights that geopolitical tensions and global conflicts are likely to increase the inflow of questionable or high-risk funds into Switzerland, raising the exposure of financial intermediaries. According to FINMA, Switzerland’s role as a leading hub for cross-border private asset management continues to make the sector particularly vulnerable. Asset management remains an area where risk-taking is still not aligned with institutions’ defined risk tolerance, and controls are often insufficient, especially when dealing with clients from high-risk countries and politically exposed persons (PEPs). Financial intermediaries must therefore clarify in detail the origin of such persons' assets and ensure that they come from legal sources. The supervisory authority emphasizes that deficiencies in due diligence, monitoring, and documentation continue to be observed across all institutions. FINMA warns that new geopolitical realities are reshaping financial flows, increasing the likelihood that assets linked to corruption, sanctions evasion, or other predicate offences could enter the Swiss financial system. In this environment, failure to properly clarify the origin of assets and funds can expose institutions to significant legal and reputational damage – risks that can affect not only individual companies but also the Swiss financial center as a whole. Activities related to cryptocurrencies also remain a key focus area. Institutions operating in the digital-asset space without robust AML frameworks in place risk undermining the integrity and reputation of the Swiss market. To address these challenges, FINMA reaffirms its expectations for an effective anti-money laundering system, which requires a clearly defined risk tolerance by the financial intermediary's senior management (“tone from the top”). Certain particularly high-risk customer segments and services must be excluded, and tolerated risks must be monitored and limited at all times. In addition, FINMA requires strict application of customer due diligence and systematic monitoring of high-risk customer segments. For Swiss financial institutions, FINMA’s message is clear: the geopolitical environment is increasing AML exposure, and institutions must ensure that their governance, risk controls, and monitoring systems are robust enough to prevent abuse of the Swiss financial system. Failure to do so exposes firms to sanctions, legal consequences, and regulatory intervention.

3. Outsourcing risks:

With the increased use of cloud services and software-as-a-service models, FINMA notes the increased dependence on a few critical ICT providers, which gives rise to systemic risks. FINMA notes that even incidents with third parties that are not significant outsourcing providers could have a far-reaching impact on the Swiss financial market.

What's Next?

FINMA will align its supervisory focus with the risks identified in the Risk Monitor. In particular, among other measures, FINMA intends to: 1. focus on governance, risk culture and risk management, 2. continue to focus on sustainable mortgage lending, 3. regularly remind boards of financial institutions regarding their responsibilities with respect to their lending policy, 4. focus, regarding credit risks, on leveraged finance positions, corporate lending and lombard lending activities, 5. monitor credit spread risk as part of FINMA's supervisory dialogue (e.g. through its regular loss-potential analysis and by identifying outliers), 6. as regards ICT risks, to monitor them through on-site reviews and by evaluating supervisory and audit data.

As regards AML risks, FINMA will continue to carry out targeted on-site inspections in all areas of supervision, with a particular focus on the handling of high-risk customer relationships and the effectiveness of internal AML controls. FINMA intends to intensify supervisory engagement in 2025, particularly in asset management and crypto-related business models. Therefore, institutions should reassess their AML frameworks, ensure that risk appetites are meaningfully applied in practice, and strengthen controls around high-risk clients and complex asset flows.

As regards outsourcing risks, FINMA monitors outsourcing risks by specific on-site reviews and by systematically evaluating supervisory and audit data. FINMA intends to focus in its supervision on outsourcing of critical functions that are key for operational resilience.