FlowBank SA, an online broker and trading bank based in Geneva, Switzerland, has been instructed by the Swiss Financial Market Supervisory Authority (FINMA) to enter into bankruptcy liquidation proceedings.

In accordance with FINMA's directives, as of 8:00 AM on June 13, 2024, FINMA revoked FlowBank SA's licenses as a bank and securities dealer, resulting in an immediate cessation of all its commercial activities.

Refund of Client Funds and Transfer of Assets

Cash deposits held in the name of clients in Swiss accounts will be refunded up to CHF 100,000 per client in the short term. Liquidators are preparing the terms and conditions for these refunds and will notify clients accordingly.

Custodial assets held by clients, such as stocks, bonds, funds, and certificates, are segregated from the bankruptcy estate and will be returned to clients based on the liquidators' determinations, possibly subject to compensation or other conditions.

Walder Wyss SA in Geneva has been appointed as the bankruptcy liquidator for FlowBank, tasked with overseeing the liquidation process. The legal jurisdiction for these proceedings is set at FlowBank's headquarters in Geneva.

FlowBank SA is prohibited from conducting banking transactions or acting as a securities dealer without explicit approval from the liquidators. This injunction covers all financial activities, including payments, securities trading, and legal obligations.

Reportedly, since October 2021, FlowBank SA has been under FINMA scrutiny due to serious breaches of regulatory laws, particularly concerning capital requirements, organizational suitability, and risk management issues.

Despite extensive measures taken and the appointment of an independent auditor in October 2022, the bank continued to violate capital ratio requirements and exhibited persistent deficiencies in its operations.

Contractual Obligations and Client Impact

All agreements between FlowBank SA and its clients, including contracts for financial instruments and derivatives, have been terminated immediately. Clients with regular contracts such as leases have been informed that these contracts will not automatically transfer to the bankruptcy estate unless specified by the liquidators.

Clients and stakeholders are advised to await further notices from Walder Wyss SA regarding the refund process, asset transfer procedures, and the implications of contract terminations.