Swiss MPs rebel against state aid to save Credit Suisse

The Chamber of Deputies of the Swiss Parliament today rejected public aid to save Credit Suisse and that the UBS bank agreed to acquire that establishment before its foreseeable collapse, in a vote in which it distanced itself from the position adopted hours before by the Senate, where the measure was approved.

The decision must now return to the High camerabut even if its members change their minds and reject the credit package now, this would not have much consequence or apply retroactively since the aid is formally committed and was authorized through an emergency procedure by a Parliamentary Finance Delegation.

For this reason, the parliamentary debate has been perceived above all as an opportunity for legislators to express themselves, which they did rejecting by 102 votes to 71 the loan of 100,000 million euros and the guarantee against losses of 9,000 million euros offered by the Swiss Confederation.

The position adopted by the deputies has been understood as a disapproval of the way in which the government dealt with the Credit Suisse crisis, whose bankruptcy would have had unpredictable consequences for the Swiss banking system as a whole.

During the debate it was recalled that already in 2008 – when the State had to come to the aid of UBS, which had been dragged to the brink of the precipice by the financial crisis of that year – a solution to the concept of “too big to fail” had been demanded. (too big to fail), which was considered very troublesome.

Accordingly, UBS and Credit Suisse were part of about thirty banks of systemic importance for the world economy, for which reason they could not fail in any case.

Several parliamentarians considered that there should be no banks in Switzerland that fall into this category.

In other interventions, several speakers supported the revision of the “too big to fail” regulation and others called for strengthening the powers of the Swiss financial market supervisory body.

The most repeated comments were against the directors of Credit Suisse that they did not know how to propose solutions to the multiple problems of the bank, from continuous litigation that forced it to pay billions of dollars in fines in recent years to corruption scandals in which its collaborators were involved.

The day before, the Upper House of the Swiss Parliament endorsed the financial guarantee offered by the State in the case of Credit Suisse and now he will debate the issue again after the rejection in the Lower House.

Source: EFE