March 19, 2020 / 9:54 AM / 12 days ago

UPDATE 1-Swiss lenders well equipped for coronavirus stress - FINMA

(Adds details from statement, background)

By Brenna Hughes Neghaiwi

ZURICH, March 19 (Reuters) - Switzerland’s financial institutions and market infrastructure are well equipped to deal with extreme stress scenarios and are continuing to function well as the coronavirus pandemic roils economies and markets, Swiss financial market supervisor FINMA said on Thursday.

“The operations of financial institutions and the financial market infrastructure in Switzerland are continuing to function well” through the coronavirus crisis, the Berne-based watchdog said in a statement. “The institutions are also well equipped to deal with extreme stress scenarios.”

Banks’ capital and liquidity buffers were “solid” following significant build-up since the financial crisis and were there to be used, should it become necessary, FINMA said.

FINMA cautioned that banks and other financial institutions must now be “prudent” in their capital distribution policies, especially with regards to share buybacks.

Switzerland’s biggest banks UBS and Credit Suisse both provided more upbeat than expected trading updates at the virtual Morgan Stanley European Financials Conference on Wednesday and Thursday, which saw their shares post gains.

FINMA also said it had simplified trading rules to allow for working from home and would allow certain routine deadlines and controls to be postponed.

All the supervisor’s own employees, other than “in exceptional cases”, were working from home, it noted. (Reporting by Brenna Hughes Neghaiwi, editing by Thomas Escritt)

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