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The current Chairman of the Swiss National Bank (SNB), Martin Schlegel, expressed a preference for nationalizing Credit Suisse rather than selling it to UBS, contrasting with the views of his predecessor Thomas Jordan and Finance Minister Karin Keller-Sutter. This disagreement was revealed by a parliamentary commission of inquiry. Schlegel has held the SNB presidency since October 2024.
In March 2023, the Federal Council managed the crisis surrounding Credit Suisse's downfall through urgent communications on the encrypted messaging app Threema. As UBS prepared to take over, Finance Minister Karin Keller-Sutter emphasized the stakes for the country, urging CS's leadership to accept the deal. The use of Threema allowed for rapid coordination amid the chaos, despite guidelines restricting cell phone use in sensitive discussions.
Karin Keller-Sutter, the current Finance Minister, criticized her predecessor Ueli Maurer for a "less than optimal" handover amid the Credit Suisse crisis, which was deemed self-inflicted. She noted that there was no discussion about the handover and that she never met Maurer after taking office, despite his assurances of stability. Keller-Sutter defended her communication with the Federal Council, asserting she informed them adequately about the bank's issues shortly after her transition to the Finance Department.
The PUK, led by President Isabelle Chassot, expressed frustration after the Federal Council swiftly responded to its nearly 600-page report on the CS crisis, just an hour following its presentation on December 20, 2024. The quick reaction from the government did not sit well with the PUK.
Federal Councillor Karin Keller-Sutter stated that the new understanding on bilaterals III is "significantly better" than the previously rejected Framework Agreement, aiming to stabilize relations with Brussels. She also addressed accusations regarding the Federal Council's knowledge of UBS's takeover of Credit Suisse, asserting that she informed the government adequately during her transition to the Finance Department. Additionally, she noted that Switzerland's annual cohesion contribution of 350 million francs is about 100 million francs less than Norway's.
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The Parliamentary Investigation Committee (PUK) has released a detailed 569-page report on the downfall of Credit Suisse, revealing that authorities were more aware of the bank's dire situation than previously thought. Emergency plans had been in place since late 2022, indicating that while preparations were made, oversight had been lacking for too long. As the debate over regulation intensifies, it is crucial for bankers to reassess their positions and for Parliament to ensure stability in future financial crises.
Federal Councillor Karin Keller-Sutter stated that the outcome of negotiations between Switzerland and the EU is now "significantly better," emphasizing the importance of stabilizing the EU as a key trading partner. She also addressed the PUK report on Credit Suisse, asserting that her department effectively prevented a financial crisis, despite acknowledging that the transition from her predecessor was "not ideal."
The latest performance report highlights significant variances across sectors, with PCB leading at 11.39% and consumer goods at 7.78%. In contrast, the automotive sector and telecoms show declines of -1.97% and -2.22%, respectively, while pharmaceuticals and energy face steep drops of -14.46% and -32.22%. In the banking sector, Commerzbank is rated positively, while Deutsche Bank is under observation due to high volatility. Year-to-date, Erste Group has surged by 60.3%, contrasting sharply with Sberbank's staggering -72.73% decline.
The Credit Suisse debacle highlights the inadequacies of the "too big to fail" law, revealing a significant capital problem exacerbated by regulatory fatigue and political influence from the banking lobby. Despite expert warnings and evaluations, the lack of effective oversight allowed systemic risks to persist, culminating in a crisis that questioned Switzerland's capacity to manage large international banks. The PUK's findings underscore the complexities of regulatory frameworks and the need for substantial reform to ensure financial stability.
The PUK report on Credit Suisse's downfall presents thirty proposals aimed at enhancing financial supervision and addressing the "too big to fail" issue, emphasizing the need for better coordination among authorities. While the Federal Council acknowledges most recommendations, it rejects a key proposal for stricter residency requirements for board members, citing existing corporate governance regulations. The report highlights the ineffectiveness of FINMA's interventions and raises concerns about the regulatory capture of financial authorities.
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