UPDATE 1-German ECB supervisor to head Swiss financial regulator

(Adds ECB spokesperson in paragraph 5, adds background from paragraph 6)

BERLIN, Jan 24 (Reuters) -

German national Stefan Walter, who has been with the ECB for a decade, has been appointed the new chief executive of the Swiss financial market supervisory authority FINMA and will take up his new role on April 1, the authority said on Wednesday.

Walter's appointment follows months of uncertainty after the financial regulator's former CEO, Urban Angehrn, stepped down at the end of September without a successor.

Birgit Rutishauser will remain FINMA's interim CEO until Walter, a 59-year-old German national, takes over, it added.

Walter held positions in risk supervision of euro zone banks as well as systemic bank supervision at the European Central Bank. He will leave the ECB at the end of January, according to a spokesperson for the central bank.

Prior to joining the ECB, Walter worked as a principle at EY in New York and before that in banking supervision at the Bank for International Settlements (BIS) in Basel.

He takes on the role at a crucial time for the regulator, which has come under fire for failing to act sooner, or more effectively, to halt the string of scandals at Credit Suisse in the run up to its collapse.

Swiss media has accused FINMA of being too cautious around Switzerland's large banks, which they reported did not take the regulator seriously.

FINMA has been calling for stronger powers to oversee lenders, including the ability to impose fines, and in December published a report defending its handling of Switzerland's former number 2 bank, saying it took "far reaching and invasive" measures and exhausted the full range of tools it had available.

With Switzerland's one remaining globally important bank - UBS - having a balance sheet of $1.6 trillion, nearly twice the size of the Swiss economy, banking supervision will be even more in the spotlight.

The new CEO will also have to deal with the ongoing fallout over FINMA's decision to write off 16 billion Swiss francs ($18.50 billion) of Credit Suisse's Additional Tier 1 (AT1) bonds - a controversial move that has triggered legal cases against the regulator.

The CEO position has been vacant since Angehrn, who led the regulator since November 2021, resigned in September.

He said he was quitting for health reasons, citing the high and permanent stress level during his tenure, which coincided with the crash of Credit Suisse and subsequent takeover by UBS.

It was one of a recent spate of resignations at the supervisor, chaired by Marlene Amstad.

Amstad praised Walter's experience, "particularly his knowledge in the area of large bank supervision and his links to international supervisory authorities" as a great asset for FINMA's supervision of the systemically important Swiss banks. ($1 = 0.8648 Swiss francs) (Reporting by Noele Illien and Francesco Canepa Writing by Miranda Murray Editing by Madeline Chambers and Louise Heavens)