Switzerland’s latest bullshit: We have a robust banking system
Incredible statements by the leaders of the Swiss central bank on the Credit Suisse case. And the Swiss Consob justifies the zeroing of Credit Suisse's subordinated bonds which is shaking up the financial markets.
The Swiss banking system remains solid.
Do you know who said that? Unbelievable but true: the Swiss central bank.
Yes, that same central bank that had to pass out on liquidity and guarantees for UBS to acquire the disastrous Credit Suisse.
In short, despite the doubts and unknowns that continue to hover in Switzerland even after the rescue of Credit Suisse (here an in-depth article from Start Magazine ), in Switzerland they seem to be trying to fool investors and savers.
That's what the president of the Swiss central bank said, after the emergency rescue plan led by the authorities that led to the takeover of Credit Suisse by its rival UBS on Sunday. "The Swiss banking system is very resilient and robust," Thomas Jordan said in a press conference on the occasion of the quarterly monetary policy meeting in which the central bank decided to raise interest rates.
Not only that: the Swiss Consob defended the zeroing of the Credit Suisse Cocobond – in fact, with respect to European rules, bondholders subordinated to the same shareholders were penalized surprisingly – as part of the operation that brought Credit Suisse into the arms of the 'Ubs.
“The At1 instruments issued by Credit Suisse contractually provided that they could be fully written down” in the event of specific events, 'including the granting of exceptional public aid'. This is what the Swiss financial markets authority (Finma) remarked, indirectly replying to the rumors about possible lawsuits coming from the bondholders.
The liquidity covered by the public guarantee granted to Credit Suisse on March 19, continues the FINMA, is one of the events contractually envisaged as a condition for the write-down of the At1 securities and therefore the authority 'has ordered Credit Suisse to write off the loans' .
The decision was greeted with surprise by the financial markets, as well as by the ECB, given that Credit Suisse will be bought by UBS for 3 billion francs: the shares, therefore, although heavily devalued, will not be written off, unlike the AT1 bonds.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/lultima-boiata-della-svizzera-abbiamo-un-sistema-bancario-robusto/ on Thu, 23 Mar 2023 14:38:58 +0000.