Swiss bankers could soon find out exactly when they will get their bonuses - and the answer is "not yet."
The Swiss government wants to make it legally required for senior bankers to wait years before collecting their full pay. The plan, unveiled on August 12, 2026, would force the largest banks, including UBS Group AG, to hold back a big chunk of variable pay for up to five years.
This is a real shift. Right now, Switzerland runs on a voluntary system where banks are only encouraged to delay bonuses. The new rules would make it the law.
The proposal targets the top earners at the biggest banks. Between 40% and 60% of their variable pay would be locked away, with the money staying at risk for as long as five years. If a bank later runs into trouble tied to risky decisions, that deferred money can be reduced or taken back.
UBS already does something like this on its own. According to its 2025 annual report, executive board members can lose up to 80% of their bonuses over a maximum of five years. For managing directors, the average deferral period is 3.8 years. But the government wants this to be the standard everywhere, not a choice.
The move comes after Swiss lawmakers voted down a separate proposal earlier in 2026 that would have banned banker bonuses entirely. This plan is softer, but it still sends a message.
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Finance Minister Karin Keller-Sutter put it plainly: "Short-term returns at the expense of financial stability must not pay off."
The bonus rules are only half of it. The government also wants to give Finma, the Swiss financial regulator, sharper teeth.
Under the proposal, Finma could issue coercive fines, possibly on a daily basis, when banks do not follow regulatory decisions. It could also impose administrative fines of up to 10% of a bank's annual operating revenue for legal or regulatory breaches. And for the first time, it could publicly name institutions that are under enforcement proceedings.
In severe cases, banks would lose the ability to delay regulatory orders by challenging them in court. Those orders would take effect immediately.
This matters because Finma has taken criticism for being too easy on banks before Credit Suisse collapsed in 2023. Its new CEO, Stefan Walter, has already increased on-site inspections and pushed for more tools to step in early when problems appear.
Keller-Sutter acknowledged the limits of what regulation can do, calling the new powers "no magic potion." But she also said, "In the case of UBS, we must do everything in our power to prevent that we come into such a situation."
Both Finma and the Swiss National Bank support the changes. The SNB called them "crucial" for fixing the weaknesses that the Credit Suisse crisis exposed.
Banks, industry groups, and other stakeholders can now weigh in on the plan.
For investors, the timeline matters. If you hold Swiss bank stocks, the final shape of these rules is still years away. But the direction is clear: regulators want to see more accountability baked into how bankers get paid, and they want the power to act before a crisis, not after one.
The bigger question is whether tying bonuses to long-term results actually changes behavior. The theory is simple. If a banker knows a big chunk of their pay can vanish years later when a bad bet surfaces, they might think twice about taking that bet in the first place.
That is the trade-off at the heart of this reform, and it is one every investor in Swiss banks will be watching.
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