All banks must hold collateral consisting of assets in Switzerland equivalent to 125% of the protected and preferential client deposits (Art. These privileged deposits are first paid out from the available liquid assets of the bankrupt institution and outside of the schedule of claims under bankruptcy law. The Swiss depositor protection scheme is based on a three-tier system.ĭeposits at Swiss and foreign branches of Swiss banks and securities firms up a maximum of CHF 100,000 per depositor are classed as privileged deposits (Art. The aim is to prevent depositors from withdrawing funds from their bank because they fear for its safety, thus triggering a bank run. The deposit protection scheme, however, is designed to ensure that deposits are paid out quickly up to the maximum amount of CHF 100,000 per depositor.
The deposits fall into the bankruptcy assets and without the deposit protection scheme would at best be repaid only partially when the proceeds of the bankruptcy are distributed. e-h of the Banking Act, depositors lose access to the money they have deposited. If a bank or securities firm is declared bankrupt or a protective measure is imposed under Article 26 para.
