The Swiss government will conduct an in-depth investigation into the crisis that led to the collapse of the major bank Credit Suisse. The government promised this to the Swiss parliament on Thursday. The larger Swiss industry peer UBS eventually bailed out Credit Suisse.
The Credit Suisse crisis and the bailout of Switzerland’s second-largest bank have led to fierce criticism in politics and among the population of the Alpine country. In addition, credit Suisse has long been plagued by a series of scandals.
To avoid a bigger crisis in the Swiss and global banking sector, the bank was rescued by UBS under government pressure after a hectic weekend last month. But Switzerland has offered billions in guarantees.
The investigation must now reveal how Credit Suisse might have ended. The bank’s risks and the impact of rising interest rates will be examined, among other things. The investigation should be completed within a year and should help prevent such a situation from happening again.
On Wednesday, it was announced that the government has ordered that bonuses for the top management of Credit Suisse be scrapped. In addition, the bonuses for the management layers below will be reduced.
New UBS chief executive Sergio Ermotti has told Credit Suisse staff that staying focused on customers and keeping things going is critical. Reuters reported this based on an internal memo. According to Ermotti, it is important not to be distracted by the efforts for the merger between UBS and Credit Suisse.
The Swiss Ermotti has succeeded the Dutchman Ralph Hamers as CEO of UBS to steer the merger with Credit Suisse in the right direction. Hamers, also a former ING CEO, formally handed over the baton to Ermotti on Wednesday.