The Swiss finance minister said the Swiss economy would likely have collapsed if Credit Suisse had failed, in an interview published by the daily Time.
Karin Keller-Sutter said the government acted in the country’s best interest by quickly arranging the takeover of Switzerland’s second-largest bank by UBS, its main rival in the country.
120 billion dollars on the table
Following fears of a global banking crisis last month, investor confidence in Credit Suisse plummeted on March 15 when the government orchestrated a takeover over the weekend before markets reopened on March 15. March 20.
Some 109 billion Swiss francs ($120 billion) have been put on the table, between government guarantees and liquidity provided by the Swiss central bank.
“Given the circumstances, we have done the best we can to minimize the burden on the State and taxpayers,” stressed Karin Keller-Sutter.
“Why? Because over the years there has been a culture that seems to have created the wrong incentives. Because there have been many scandals,” the minister said.
UBS among the 30 global banks too big to fail
Like UBS, Credit Suisse is among 30 banks around the world deemed to be of global importance to the international banking system and therefore too big to fail.
But in recent years it has been embroiled in a series of scandals and when three regional US banks collapsed in March, it emerged as the weak link in global finance.
Talks for its takeover by UBS were hurriedly held at the Finance Ministry, held by Ms. Keller-Sutter in Bern, and the $3.25 billion deal was announced on the evening of March 19.
Asked whether the executives would be brought to justice, the minister replied: “It is difficult and complex.”
She felt that the government’s priority was to complete the merger. UBS had indicated on Wednesday that it should complete the acquisition in the coming months.
Too soon to talk about the future structure of the megabank
The finance minister told the newspaper it was too early to talk about the future structure of UBS, which will become a megabank with some $5tn in invested assets.
Karin Keller-Sutter clarified that the government must look at what happened in its entirety, then adapt the regulations on banks considered too big to fail.
Source: BFM TV
