“Socialists call for tougher rules on banking crisis and systemically important banks”

2023-05-02 16:44:45

Three weeks following the extraordinary session on the banking crisis, the debate is still divided. But this time, the Socialists succeeded in having three interventions accepted to toughen the rules. The Council of States will still have to validate.

The two motions and the postulate of Prisca Birrer-Heimo (PS/LU) had been tabled well before the bankruptcy of Credit Suisse, in the context of the losses posted following the debacle of Greensill and Archegos. Since then, Credit Suisse itself had to be rescued urgently.

For the socialist, recent events show that it is urgent to act. She reminded MPs on Tuesday of their promises made during the extraordinary session. “We can no longer wait for reports,” says Ms. Birrer-Heimo.

Bounty hunting can cause serious harm to customers and shareholders. But when it comes to systemically important banks, “it’s us, the taxpayers, who pay for this risk”. There are banks that can do without this system like Raiffeisen, she recalled. His motion asks to prohibit the payment of bonuses to the upper levels of the hierarchy.

As for own funds, the current standards are insufficient. It calls for systemically important banks to be required to hold an unweighted capital ratio of at least 15%. However, following the fall of Credit Suisse, voices were raised asking for much more.

No to hasty decisions

Federal Councilor Karin Keller-Sutter replied that all these questions had been extensively discussed in April and that the Federal Council had been instructed to report within a year on all these aspects. According to the Minister of Finance, we must not anticipate.

An opinion that the plenum did not share. The two motions were accepted respectively by 101 votes once morest 70 and 92 once morest 82. About twenty elected members abstained each time.

Strengthen FINMA

As for the supervisory authority that is FINMA, the socialist wants to give it real means of punishing establishments that fail in their obligations. According to her, FINMA must be able to impose real fines and make the sanctions public. The postulate was tacitly adopted with the agreement of Federal Councilor Keller-Sutter, who has since changed her mind.

During the extraordinary session, Parliament gave the government a mandate to examine all the aspects that led to the bankruptcy of Credit Suisse. All parties had supported these postulates.

The extraordinary session focused on the forced takeover of Credit Suisse by UBS, decided on March 19 by the government. The Confederation has submitted two urgent credits totaling CHF 109 billion to Parliament as a guarantee.

The first, in the amount of 100 billion, allows the Confederation to guarantee the loans granted by the SNB to Credit Suisse. The second of 9 billion is intended for UBS for possible losses. The National rejected those guarantees. The SNB has also freed up 150 billion francs of liquidity.

This article has been published automatically. Source: ats

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