The following gives a short overview on various aspects in connection with the establishment of a bank in Switzerland, in particular concerning the field of activities, the structure, the organization, the reporting and auditing, and problems arising from the outsourcing of back office functions under the relevant provisions of Swiss banking law.
A company needs a banking license (i) if such company publicly solicits customer deposits (except deposits from banks) for the purpose of financing third parties, and/or (ii) if the company provides financing to a non-specified number of persons not forming part of the same economic unit provided the refinancing is made in a large volume at several banks not possessing majority holdings in the company (art. 1 of the Federal Act on Banks and Savings Banks, FAC).
The banking licenses granted by the Federal Banking Commission (FBC) are usually general banking licenses, covering all types of banking activities (although sometimes with the exception of savings accounts). For the activities covered by the Federal Act on Stock Exchanges and Securities Trading (Stock Exchange Act, SESTA) which entered into force on February 1, 1997, banks need in addition a license as a securities trader, which, however, can be easily obtained by companies already licensed as a bank.
A foreign-controlled Swiss bank organized in the form of a Swiss joint-stock company (Aktiengesellschaft, Société Anonyme) is required to have a minimum stated capital of CHF 10'000'000.-- in order to qualify for a banking license.
However, the FBC will determine the required capital taking into consideration the planned banking activities.
The bank must create separate bodies for the management on the one hand and the direction, supervision and control on the other hand (art. 3 para. 2 FAC). The persons managing the bank must be resident at a place from where they can actually exercise the management of the bank, i.e. usually in the territory of Switzerland (art. 3 para. 2 lit. d FAC). The majority of the members of the board of directors of the bank must be Swiss citizens living in Switzerland. The bank must have internal business regulations which shall fully describe the business operations and provide for an administrative organization appropriate to the proposed business activities.
A Swiss bank is obliged to have external auditors who have been approved to act in such capacity by the FBC. The banking law auditors may be identical with the auditors required pursuant to the Swiss Code of Obligations for joint-stock companies. In addition, the bank will usually need internal auditors who are directly reporting to the board of directors of the bank. Subject to certain conditions the internal audit function may be contracted out to a specially qualified legal entity or individual.
The bank must publish the annual balance sheet and profit and loss statement. If the balance sheet total of the bank exceeds the amount of CHF 100'000'000.--, the bank is obliged to draw up interim balance sheets every half year.
When centralizing or outsourcing back-office functions, a Swiss bank has to take into account the stringent provisions of Swiss banking secrecy, of data protection and of the provision against economic espionage in the Penal Code. The FBC has, however, approved schemes for the processing of customer data of a Swiss bank abroad, if such customer data were anonymized, i.e. the names of such customers were not transmitted. Furthermore, general research of the bank may be carried out abroad. Transfer of non-anonymized customer data will usually be allowed if the respective customer explicitly agrees to such transfer.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
