FINMA launches consultation on the partially revised Circular 2019/2 “Interest rate risks – banks”
AI Analysis
FINMA opened a consultation on 4 November 2026 to partially revise Circular 2019/2, including implementation of the Basel Committee’s July 2024 recalibrated interest-rate shocks for banking-book risk. The proposal also responds to FINMA’s 2025 ex-post evaluation by refining proportionality, validation expectations and consideration of earnings effects; it is not yet a binding final rule.
Key dates
- 2025-11-26
- FINMA published its ex-post evaluation of Circular 2019/2, identifying potential improvements to proportionality and validation requirements and announcing a planned partial revision.
- 2026-11-04
- FINMA launched the consultation on the partial revision of Circular 2019/2.
- 2027-01-15 Deadline
- The FINMA consultation period closes; consultation responses should be submitted by this date.
Suggested considerations
- Banks should review the consultation package and consider submitting comments to FINMA by 15 January 2027, particularly on proportionality, validation burden, earnings-risk metrics and implementation timing.
- Risk and finance teams should perform an impact assessment using the Basel Committee’s July 2024 recalibrated shock methodology, including the potential effect of 25-basis-point rounding and updated historical calibration data.
- Banks should map current interest-rate-risk models, independent validation procedures and model governance against the expected clarification of minimum validation requirements.
- Compliance teams may wish to reassess whether the institution’s proportionality framework appropriately differentiates requirements by size, business model, complexity and risk profile, while retaining evidence supporting those judgments.
- Treasury and risk functions should assess whether existing interest-rate-risk reporting captures both economic-value effects and effects on net interest income or other relevant revenue measures.
- Governance bodies should record the consultation assessment, scenario-analysis results, model changes and any decision to submit industry comments, while continuing to apply the currently effective Circular 2019/2 until a final revision enters into force.
What changed
The proposed revision would update the standardised interest-rate shock scenarios used to measure interest-rate risk in the banking book, reflecting the Basel Committee’s July 2024 recalibration. The Basel recalibration uses updated historical data, a 99.9th-percentile shock-factor methodology and shock values rounded to 25 basis points; the Basel standard contemplated implementation from 1 January 2026, but the Swiss implementation timeline will depend on FINMA’s final circular. FINMA also proposes targeted improvements arising from its ex-post evaluation, including clearer or improved proportionality rules and more precise minimum requirements for validation. The revised supervisory practice would give greater consideration to how interest-rate risk affects revenues, in addition to balan
Compliance impact
The consultation does not itself create new binding obligations, but it signals a likely near-term supervisory adjustment affecting interest-rate-risk measurement, model validation, proportionality assessments and earnings-risk monitoring. Banks may face implementation, model redevelopment, data, governance and reporting work once the final circular is adopted; weaknesses in managing banking-book
Who is affected
Related regulations
References
AI-generated analysis. May contain errors or omissions — verify with the original FINMA source before acting. Full disclaimer.
What the FINMA said
On 4 November 2026, the Swiss Financial Market Supervisory Authority FINMA launched the consultation on the partially revised Circular 2019/2 “Interest rate risks – banks”. The consultation will go on until 15 January 2027.
Published by FINMA . Read the full notice at the source for the authoritative text.