• FINMA conducted over a third of bank inspections at UBS in 2025
• Emergency plan meets requirements but lacks practical implementation
• Regulator says plan cannot yet ensure financial system stability
• UBS must operationalize and align resolution strategies
• Ongoing scrutiny reflects systemic importance after Credit Suisse takeover 

Switzerland’s financial watchdog has intensified its scrutiny of UBS, warning that the bank’s emergency resolution plan remains insufficient to protect the broader financial system in the event of a crisis.

The FINMA said it conducted a significant proportion of its on-site inspections at UBS last year, reflecting ongoing concerns about the bank’s resilience following its emergency takeover of Credit Suisse in 2023.

According to the regulator, 42 of the 113 inspections carried out across the banking sector in 2025 were focused on UBS.

This follows a similarly high level of oversight the previous year, when the bank accounted for 45 of 111 inspections.

The concentration of supervisory activity underscores the systemic importance of UBS and the challenges associated with integrating its former rival.

FINMA acknowledged that UBS has made progress in developing its emergency planning framework. The bank submitted an updated plan at the end of 2024, which the regulator said largely meets statutory requirements.

However, the watchdog stressed that compliance on paper does not yet translate into operational readiness.

In its assessment, FINMA concluded that the current plan cannot adequately ensure financial stability if the bank were to face severe stress.

“In its current form, the emergency plan cannot yet ensure that risks to the stability of the financial system are sufficiently addressed,” the regulator said.

The finding raises fresh concerns about the effectiveness of UBS’s recovery and resolution strategy, particularly given its expanded scale and complexity following the Credit Suisse acquisition.

The combined entity is now one of the largest and most interconnected banks globally, increasing the potential impact of any failure.

FINMA went further in its critique, stating that the plan is not yet implementable. The regulator said UBS must take additional steps to “operationalize” its alternative resolution options and ensure that its contingency planning is aligned with real-world execution requirements.

The emphasis on operationalization highlights a broader regulatory focus on moving beyond theoretical frameworks toward practical readiness.

Supervisors are increasingly demanding that banks demonstrate how crisis plans would function under real conditions, rather than relying solely on documented strategies.

UBS has been under sustained regulatory pressure since it was called upon to rescue Credit Suisse during a period of market turmoil. The deal, orchestrated by Swiss authorities, was designed to stabilize the financial system but created a significantly larger and more complex institution.

For regulators, this has introduced new challenges. Ensuring that the combined bank can be resolved in an orderly manner without triggering wider instability is a key priority.

The latest findings suggest that work remains to be done before UBS can meet that standard.

The scrutiny also reflects a broader shift in supervisory expectations. Regulators are placing greater emphasis on credible resolution planning, particularly for systemically important institutions whose failure could have far-reaching consequences.

While UBS has not publicly responded in detail to the latest assessment, the bank is expected to continue refining its plans in close coordination with FINMA.

The process is likely to involve further testing, scenario analysis, and enhancements to internal governance and operational capabilities.