2023-06-22 05:45:40
– The SNB wants to learn from the Credit Suisse debacle
New measures should make it possible to strengthen the solidity of banks, estimates the issuing institution in its annual report on financial stability.
Posted today at 07:45
Credit Suisse was forcibly merged with UBS last March to avoid bankruptcy.
ENNIO LEANZA/KEYSTONE
The Swiss National Bank (SNB) wants to learn from the debacle of Credit Suisse, forcibly merged in March with its competitor UBS to avoid bankruptcy. New measures should in particular make it possible to strengthen the solidity of institutions in order to avoid a loss of confidence among investors and customers.
Banks must comply with capital requirements, but this is not enough, said the Swiss central bank in its annual report on financial stability published Thursday.
The capital ratios of the two-veiled bank did indeed exceed the required requirements, but the market and the rating agencies increasingly questioned Credit Suisse’s ability to generate profits, its solidity and its ability to put implement its restructuring process announced in October 2022.
The issuing institution also found that the so-called AT1 financial instruments, intended to absorb losses, “have not been effective”. Credit Suisse did not cancel interest payments on these bonds, which would have improved the financial situation.
The ebbs of funds recorded by the bank at the end of 2022 and the beginning of 2023 were “unprecedented” and greater than anticipated by regulators. The bank’s liquidity and the support of the SNB “have not been sufficient to cover the massive outflows of liquidity”, she noted.
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