Switzerland cracks down on banking: multimillion-dollar bonuses under state control

The Swiss government opened a public consultation to impose stricter rules on bank executives’ bonuses, with mandatory deferrals and caps aimed at preventing systemic risk at the heart of Europe’s financial sector.

What the plan proposes

The reform introduces mandatory bonus deferrals for senior executives of major banks, so a significant share of compensation is tied to future results and can be clawed back if institutions incur losses. The goal: nobody pockets millions for decisions that later cost taxpayers dearly.

The context

The initiative follows the scandals and bailouts that shook Swiss banking, and directly targets major groups such as UBS. Banking associations already anticipate strong opposition, while the government defends the measure as necessary for stability.

Why it matters

Switzerland concentrates a disproportionate share of the world’s private banking. What Bern decides about bankers’ bonuses sets the tone for the rest of Europe’s financial centers and redefines the relationship between the state and the financial sector.

The key figure

UBS. The Swiss banking giant, symbol of “too big to fail” banking, at the center of the debate over multimillion-dollar bonuses.