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The Chamber of Deputies distances itself from the Senate: it rejects the rescue of Credit Suisse

Date: March 28, 2024 Time: 21:58:01

The Chamber of Deputies of the Swiss Parliament has rejected this Wednesday public aid to save Credit Suisse despite the fact that UBS accepts it to acquire that entity before its foreseeable collapse. The refusal occurred in a vote in which the Lower House distanced itself from the position that was adopted a few hours earlier by the Senate, where the measure was approved.

Faced with the previous scenario, the decisions made and the change of opinion to reject the credit package will not have much consequence nor will they be used retroactively. However, the decision must now be returned to the Upper House despite the fact that it will not suffer effects 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 devised above all as an opportunity for legislators to express themselves, which led them to reject by 102 votes against 71 the loan of 100,000 million euros and the guarantee against losses of 9,000 euros per euro. Swiss Confederation.

UBS and Credit Suisse among the top 30 banks

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 had unpredictable consequences for the Swiss banking system as a whole.

During the debate it was recorded that already in 2008 -when the State had to come to the aid of UBS after being dragged to the edge of the precipice by the financial crisis of that year- a solution had been demanded to the concept of “too big to fail” ( too big to fall), which will be considered very troublesome.

Accordingly, UBS and Credit Suisse were part of about thirty banks of systemic importance for the world economy, for which they could not fail in any case. Several parliamentarians consider that in Switzerland there is no need for banks to fall into that category.

In other outbreaks, several deputies 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 Credit Suisse executives who failed to come up with solutions to the bank’s multiple problems, from ongoing litigation that forced it to pay billions of dollars in fines in recent years to corruption scandals in which his collaborators were involved. The day before, the Upper House of the Swiss Parliament endorsed the financial guarantee offered by the State in the Credit Suisse case and will now debate the issue again after the rejection in the Lower House.

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.
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