FINMA Circular 2008/14 Supervisory Reporting - Banks

Laupenstrasse 27, 3003 Bern Tel. +41 (0)31 327 9100, Fax +41 (0)31 327 9101 www.finma.ch Circular 2008/14 Supervisory Reporting – Banks Supervisory reporting following annual and semi-annual financial statements at banks Reference: FINMA-Circular 08/14 "Supervisory Reporting – Banks" Issued: 20 November 2008 Entry into force: 1 January 2009 Last amendment: 4 November 2020 [Amendments are marked with * and listed at the end of the document] Concordance: formerly EBK-Circular 05/4 "Supervisory Reporting" of 24 November 2005 Legal basis: FINMA Act Art. 7 para. 1 lit. b, 24, 25, 29, 39 Banking Act Art. 3 para. 2 lit. cbis, 18 Banking Ordinance Art. 13, 31, 34, 35, 40 Financial Institutions Act (FINIG) Art. 8 para. 1, 11 para. 4 Financial Institutions Ordinance (FINIV) Art. 13 para. 4, 72 FINMA Accounting Ordinance (RelV-FINMA) Art. 3, 32 Annex 1: Components of the reports Annex 2: Repealed Annex 3: Securing privileged deposits

Addressees Banking Act VAG FINIG FinfraG KAG GwG Others Banks Financial groups and conglomerates Other intermediaries Insurers Insurance groups and conglomerates Intermediaries Asset managers Trustees Managers of collective capital investments Fund management companies Custodial securities firms Non-custodial securities firms Trading venues Central counterparties Central securities depositories Transaction registers Payment systems Participants SICAV KmG for CCI SICAF Custody banks Representatives of foreign CCIs Other intermediaries SRO SRO-supervised entities Audit firms Rating agencies X

Table of Contents 2/12 I. Purpose Rz 1–3 II. Scope of Collection Rz 4–6 III. Subject Matter and Addressees of Reports Rz 7–15 IV. Timing and Deadlines Rz 16–19 A. Annual Financial Statements Rz 16–18 B. Semi-Annual Financial Statements Rz 19 V. Audit Rz 20–21

3/12 I. Purpose This circular determines which information banks, securities firms, and financial groups must submit to the FINMA directly or indirectly via the Swiss National Bank (SNB) annually or semi-annually using uniform survey forms and in electronic form. 1* This information enables the FINMA to operate a rating and analysis system to ensure risk-oriented supervision. Through statistical evaluations, such as pre-cutoff date comparisons, time series analyses, comparisons between individual banks, securities firms, and financial groups, as well as within comparison groups, the FINMA gains a comprehensive overview of the condition and development of the banking system. Supervisory reporting thus occurs in addition to reporting by audit firms. 2* The listing of qualified participants in a bank or securities firm (Art. 13 Banking Ordinance, Art. 13 para. 4 FINIV) serves to verify the continuous compliance with licensing requirements (Art. 3 para. 2 lit. cbis Banking Act; Art. 11 FINIG) as well as to determine any potential foreign control and assess the necessity of consolidated supervision. 3* II. Scope of Collection All banks and securities firms must submit the annual and semi-annual supervisory reporting reports (Rz 8, 10) as well as the annual declaration on holders of qualified participations (Rz 12) on an individual basis. 4* Financial groups must additionally report the corresponding supervisory reporting data (Rz 9 and 11), provided they • are required to prepare a consolidated financial statement or a partial consolidated financial statement in accordance with Art. 34 and 35 Banking Ordinance or Art. 72 FINIV, or 5 • due to a holding or comparable group structure, have been obligated by a FINMA order or in another manner to comply with accounting, own funds, and risk distribution regulations on a consolidated basis. 6 III. Subject Matter and Addressees of Reports Banks, securities firms, and financial groups report to the following addressees: 7*

4/12 Report Addressees • Annual supervisory reporting according to Annex 1 on an individual basis • SNB and audit firm 8 • Annual supervisory reporting according to Annex 1 on a consolidated basis • SNB and audit firm 9 • Semi-annual supervisory reporting according to Annex 1 on an individual basis • SNB and audit firm 10 • Semi-annual supervisory reporting according to Annex 1 on a consolidated basis • SNB and audit firm 11 • Declaration on holders of qualified participations • FINMA and audit firm 12 Repealed 13* The figures reported to the SNB according to Annex 1 are verified for plausibility, processed, and forwarded to the FINMA by the SNB. They are treated confidentially. This avoids duplicate reporting – not least in the interest of the supervised banks and securities firms. 14 Banks and securities firms prepare the supervisory reporting based on their statutory individual financial statements (Art. 25 para. 1 Banking Ordinance). 14.1* In accordance with Art. 958d para. 3 of the Swiss Code of Obligations (OR; SR 220), accounting is conducted in Swiss Francs or a currency essential for business activities. If a foreign currency is used, all values in the accounting must additionally be stated in Swiss Francs. For supervisory reporting, the values converted into Swiss Francs are decisive. 14.2* The survey forms for supervisory reporting according to Annex 1 are based on the minimum structure according to Annex 1 Banking Ordinance. These survey forms must also be used by financial groups applying an internationally recognized accounting standard recognized by the FINMA (Art. 3 Accounting Ordinance-FINMA [RelV-FINMA; SR 952.024.1]). The positions of the consolidated financial statement are to be assigned analogously to the positions according to the survey forms. The corresponding recording documents are provided to the reporting institutions by the SNB. The data must generally be submitted electronically. 15* IV. Timing and Deadlines A. Annual Financial Statements The reports according to Rz 8–9 and 12 must be prepared annually as of the cutoff date of the annual financial statements. 16* These reports must be submitted within 60 days after the cutoff date. In justified cases, the FINMA may exceptionally extend this deadline by up to 20 days. 17

5/12 The submission of supervisory reporting on an individual and consolidated basis generally occurs before the completion of audits by the audit firms. Banks, securities firms, and financial groups whose figures undergo changes after the report has been submitted must resubmit the entire report to the SNB within seven months after the cutoff date. 18* B. Semi-Annual Financial Statements The reports according to Rz 10–11 must be submitted within 60 days after the cutoff date of the interim financial statements. In justified cases, the FINMA may exceptionally extend this deadline by up to 20 days. 19 V. Audit The supervisory reporting and the declaration on holders of qualified participations must be audited by the audit firm as part of the supervisory audit according to FINMA-Circular 13/3 "Audit Matters". The audit firm may, if necessary, rely on findings from the financial statement audit. 20* If the audit results in findings that deviate significantly from the information provided by the bank or securities firm, these must be shown and justified by the audit firm in the supervisory audit report. 21*

Annex 1 Components of the Reports 6/12 I. Supervisory Reporting on an Individual Basis A. Annually • Qualitative questions / Regulations, approaches, and currencies applied for accounting (SNB survey AUR_U / Form AUMD1) 1* • Balance sheet (after profit appropriation) (SNB survey AUR_U / Form AU201) 1.1* • Income statement (SNB survey AUR_U / Form AU202) 2* • Equity analysis (after profit appropriation according to the board's proposal) (SNB survey AUR_U / Form AU203) 3* • Provisions / Reserves for general banking risks / Write-downs (SNB survey AUR_U / Form AU204) 4* • Write-downs for default and country risks, overdue claims, and interest shortfalls (SNB survey AUR_U / Form AU205) 5* • Open derivative financial instruments (SNB survey AUR_U / Forms AU206A and AU206B) 6* • Supplementary information - Breakdown of managed assets (SNB survey AUR_UEA / Form AU207) Reporting is mandatory for banks and securities firms that exceed the limit according to Art. 32 para. 3 and 6 FINMA Accounting Ordinance. Banks in categories 1 and 2 according to Annex 3 to the Banking Ordinance are also reporting mandatory without exceeding the limit. 7* • Survey on privileged and secured deposits and coverage values (SNB survey AUR_UES / Form AU208), see explanations in Annex 3 8* • Key figures (SNB survey AUR_U / Form AU209) 8.1* B. Semi-annually • Semi-annual balance sheet (SNB survey AURH_U / Form AUH201) 9* • Semi-annual income statement (SNB survey AURH_U / Form AUH202) 10* II. Supervisory Reporting on a Consolidated Basis A. Annually • Qualitative questions / Regulations, approaches, and currencies applied for accounting (SNB survey AUR_K / Form AUMD1) 10.1* • Balance sheet (before profit appropriation) (SNB survey AUR_K / Form AU301) 11* • Income statement (SNB survey AUR_K / Form AU302) 12*

Annex 1 Components of the Reports 7/12 • Equity analysis (before profit appropriation) (SNB survey AUR_K / Form AU303) 12.1* • Provisions / Reserves for general banking risks / Write-downs (SNB survey AUR_K / Form AU304) 13* • Write-downs for default and country risks, overdue claims, and interest shortfalls (SNB survey AUR_K / Form AU305) 14* • Open derivative financial instruments (SNB survey AUR_K / Forms AU306A and AU306B) 15* • Supplementary information - Breakdown of managed assets (SNB survey AUR_KEA / Form AU307) Reporting is mandatory for financial groups that exceed the limit according to Art. 32 para. 3 and 6 FINMA Accounting Ordinance. Financial groups in categories 1 and 2 according to Annex 3 to the Banking Ordinance are also reporting mandatory without exceeding the limit. 16* • Key figures (SNB survey AUR_K / Form AU309) 16.1* B. Semi-annually • Semi-annual balance sheet (SNB survey AURH_K / Form AUH301) 17* • Semi-annual income statement (SNB survey AURH_K / Form AUH302) 18*

Annex 3 Securing Privileged Deposits 8/12 In accordance with Art. 37a para. 6 Banking Act, banks must constantly hold domestically covered claims or other assets located in Switzerland amounting to 125% of their privileged deposits. The principles applied by the FINMA in determining creditability are outlined below. 1 I. Principles for the Creditability of Assets The following principles apply to the creditability of assets according to Art. 37a para. 6 Banking Act: 2 • Only the positions explicitly listed as creditable in Section II are creditable. The classification into the various categories and positions must be made in accordance with Annex 1 Banking Ordinance, the FINMA Accounting Ordinance, and FINMA Circular 2020/1 "Accounting – Banks". 3 • The provisions regarding non-creditable assets according to Section III take precedence over the provisions regarding creditable assets according to Section II. 4 • Creditability is determined at the value decisive according to the accounting standards applied. In particular, any write-downs must be taken into account. 5 • Only assets that are located domestically or credited at a domestic custodian are creditable. Assets with unclear location, as well as equity and debt securities or claims against group companies and affiliated companies, are not creditable. 6 • An asset for which creditability requires its securing can only be credited if the security is a customary business security and the security is also located domestically or credited at a domestic custodian. Securities with unclear location, as well as securities on equity and debt securities or on claims against group companies and affiliated companies, do not meet the requirement of securing. 7 • Assets already issued as security are in no case creditable. 8 II. Creditable Assets As domestically covered claims or other assets located in Switzerland within the meaning of Art. 37a para. 6 Banking Act, the following may be credited (Rz 0–0): 9 A. Liquid Funds • Current notes and coins located in Switzerland in CHF (excluding numismatics) and in freely convertible foreign currencies 10

Annex 3 Securing Privileged Deposits 9/12 • Current account balances at the Swiss National Bank 11 • Current account balances at domestic clearing centers recognized by the FINMA 12 B. Claims against Banks • Secured and unsecured claims against banks and securities firms supervised by the FINMA, provided they are credits or investments 13 • Secured claims in CHF or in freely convertible foreign currencies 14 C. Claims against Customers/Mortgage Claims • Secured and unsecured claims against insurance companies supervised by the FINMA, provided they are credits or investments 15 • Secured and unsecured claims against the Confederation, Cantons, and domestic political municipalities 16 • Secured claims in CHF or in freely convertible foreign currencies 17 D. Trading Business and Financial Investments • Money market papers from the Confederation, Cantons, and domestic political municipalities 18 • Money market papers of the SNB 19 • Securities credited at a domestic custodian that are traded on a representative market 20 • Precious metal holdings located in Switzerland 21 • Real estate and other values in financial investments with location in Switzerland 22 E. Positive Replacement Values of Derivative Financial Instruments Positive replacement values of derivative financial instruments against domestic counterparties, insofar as these are secured domestically (e.g., through a margin account) 23 F. Fixed Assets Bank buildings and real estate in Switzerland to the extent of the book value minus the mortgage encumbrance 24 G. Other Assets Withholding tax refund claims 25

Annex 3 Securing Privileged Deposits 10/12 III. Non-Creditable Assets The following are not creditable as claims or assets within the meaning of Art. 37a para. 6 Banking Act, in particular: 26 • Claims from leasing transactions 27 • Checks and bills of exchange 28 • Accruals 29 • Participations 30 • Intangible assets, goodwill, software 31 • Unpaid share capital 32 • Own equity and debt securities 33 IV. Exceptions Upon application, the FINMA may grant exceptions from the principles outlined in justified cases. 34

List of Amendments 11/12 The circular is amended as follows: This amendment was decided on 1.6.2012 and enters into force on 1.1.2013. The references to the Own Funds Ordinance (ERV; SR 952.03) were adapted to the version entering into force on 1.1.2013. These amendments were decided on 6.12.2012 and enter into force on 1.1.2013. Amended Rz 7, 13, 20, 21 These amendments were decided on 27.3.2014 and enter into force on 1.1.2015. New Rz 14.1, 14.2 Amended Rz 1, 2, 3, 4, 5, 7, 13, 15, 16, 18, 20 This amendment was decided on 31.7.2015 and enters into force on 1.9.2015. Amended Rz 3 This amendment was decided on 16.10.2015 and enters into force on 1.1.2016. Amended Rz 13 These amendments were decided on 7.12.2017 and enter into force on 1.1.2019. Amended Rz 1, 4, 5, 16, 20 Repealed Rz 13 The references to FINMA Circular 2015/1 "Accounting Banks" were adjusted as of 1 January 2020 to FINMA Circular 2020/1 "Accounting – Banks" or the FINMA Accounting Ordinance of 31 October 2019 and the foundations in the Banking Ordinance. In the context of the entry into force of the FIDLEG/FINIG legislation on 1 January 2020, the references and terms were adapted. The annexes of the circular are amended as follows: These amendments were decided on 27.3.2014 and enter into force on 1.1.2015. New Annex 1, Rz 8.1, 12.1, 16.1 Amended Annex 1, Rz 2, 4, 5, 8, 13, 14 These amendments were decided on 31.7.2015 and enter into force on 1.9.2015. Amended Annex 1, Rz 1–18: Adaptation of the designations of the surveys and forms to the new professionally based survey instruments of the Swiss National Bank, which are applied as of the cutoff date 30.11.2015.

List of Amendments 12/12 These amendments were decided on 16.10.2015 and enter into force on 1.1.2016. New Annex 3 Amended Annex 1, Rz 7 and 16 These amendments were decided on 7.12.2017 and enter into force on 1.1.2019. Amended Annex 1, Rz 7, 8 and 16 Repealed Annex 3 "Reporting of the ten largest debtors" These amendments were decided on 30.11.2018 and enter into force on 1.1.2019. New Annex 3 "Securing privileged deposits" The references to FINMA Circular 2015/1 "Accounting Banks" were adjusted as of 1 January 2020 to FINMA Circular 2020/1 "Accounting – Banks" or the FINMA Accounting Ordinance of 31 October 2019 and the foundations in the Banking Ordinance. In the context of the entry into force of the FIDLEG/FINIG legislation on 1 January 2020, the references and terms were adapted. These amendments were decided on 4 November 2020 and enter into force on 1 January 2021. New Annex 1, Rz 1, 10.1 Amended Annex 1, Rz 1 becomes Rz 1.1 Repealed Annex 2 "Declarations on holders of qualified or significant participations"