Liechtenstein’s Banking Industry: Compliance Reigns Supreme

Strengthening Supervisory Authority

In its efforts to ensure the stability and integrity of Liechtenstein’s financial sector, the country’s Banking Division has taken decisive measures to strengthen its supervisory authority over banks and investment firms operating in the region. The division is responsible for monitoring compliance with applicable legal norms and ensuring that institutions adhere to regulations.

Licensing Process

As part of its rigorous oversight, the division conducts thorough reviews of submitted documents during the licensing process. These reviews scrutinize the content and completeness of the documents to ensure that they meet the required standards. Ongoing monitoring is achieved through:

• Regular reporting from banks and investment firms
• Direct communication with their boards of directors and management teams

Compliance Assessment

The Banking Supervision Section relies heavily on audit reports prepared by external auditors to assess compliance with legal requirements. However, it may also conduct its own audits or accompany external ones to ensure transparency and accountability.

Enforcement Action

When violations of the law come to light, the division takes swift action to restore a lawful state of affairs. The Financial Market Authority (FMA) has the power to:

• Demand information and documents from persons and entities subject to Banking Act supervision, as well as their auditors
• Order or conduct extraordinary audits
• Issue decisions, decrees, and declaratory decrees
• Publish final decisions and decrees if non-compliance persists

A New Era of Regulatory Excellence

With these measures in place, Liechtenstein’s banking industry is poised for a new era of regulatory excellence. These efforts guarantee the trust and confidence of investors, customers, and stakeholders alike, ensuring the continued stability and integrity of the financial sector.