Taxpayers cannot pay for ‘bank misbehavior’ – Swiss finance minister

Taxpayers cannot pay for ‘bank misbehavior’ – Swiss finance minister
Taxpayers cannot pay for ‘bank misbehavior’ – Swiss finance minister

Swiss Finance Minister Karin Keller-Sutter said on Saturday that the country’s banks had exhausted the public’s “goodwill” as the government seeks to strike a balance in new financial regulations following the Credit Suisse crisis from last year.

Switzerland wants measures that protect both the banking sector and the taxpayer, Keller-Sutter said, after plans to tighten capital requirements faced opposition from UBS, the most major lender in the country which bought Credit Suisse last year.

“What I can say clearly is that it is not possible for taxpayers to foot the bill for the misconduct of banks and managers,” Keller-Sutter told Swiss newspaper Aargauer Zeitung.

“No one in this country understands that anymore – the goodwill has been exhausted.

Earlier this year, the government outlined plans to tighten capital requirements for UBS and Switzerland’s three other big banks, aiming to make the financial sector more robust after the Credit Suisse crash.

Details of the exact capital requirements have not yet been revealed, but the possibility that UBS would have to hold between $15 billion and $25 billion in additional capital has been met with resistance from the bank.

The government wants a competitive banking sector, but it is also responsible for the entire country and must therefore take precautions to avoid the uncontrolled collapse of a systemically important bank, Keller-Sutter told the newspaper.

“It’s a balancing act,” she said. “We must find a balance between competitiveness and security of the financial center.

“Banks also want stability, so the two objectives are not mutually exclusive.

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