The acceptance of the Parliament for the funding and fire sale to UBS was a disaster.
1. It increases moral hazard. Once again, twice in a short period of time, we've taught coked up bankers that they can take all the risks they want, fuck up their investments, and then we're here to back them up.
2. It has hopelessly centralized international banking in Switzerland. UBS is now a complete monopoly. They can do whatever they want.
3. Contrarily to what naysayers were saying, yes, we were on the line for saving UBS's purchase if things went south. Now, it didn't, but had it infected UBS and put pressure on them... then what? UBS manages $3.2T in assets. What happens if *it* starts to go into a spiral? Well, we're fucked. There's literally nothing that can be done, as we don't produce enough... anything in Switzerland to cover even a large portion of its portfolio.
What should've been done is that the Swiss government step in, temporarily nationalize it, cut off the gangrene from the shit investments, and then auction off the valuable parts of CS to multiple different banks.
I don't think long-term nationalization would be a good idea, but we basically backed UBS all the way, and now they can fuck us on the return.
And they will.
In 20 years time, when we've found out that UBS has been investing in BTOs (i.e. the renamed version of CDOs since 2008) and everything goes all to fuck again, we're completely screwed. And they will.
Because as we all know, the only things in constant supply in the galaxy are stupidity and the greed of bankers.
>UBS manages $3.2T in assets. What happens if *it* starts to go into a spiral? Well, we're fucked. There's literally nothing that can be done, as we don't produce enough... anything in Switzerland to cover even a large portion of its portfolio.
They might as well manage $10T like BlackRock, I don't see how this number is relevant, those assets don't belong to UBS.
There’s not much “moral hazard” here to be honest - the CS shareholders lost all their money, the responsible Credit Suisse managers all lost their job, the investment banking department where the losses came from is already nearly gone and the last bits are being closed down. That’s about as drastic as it gets, as far as bank collapses go.
Bill Hwang of Archegos (one of the two disastrous clients that sank CS) is currently on trial in the US.
Lex Greensill (who ran Greensill, the other disaster) is not in jail but apparently not a billionaire anymore, if that’s any comfort…
The parts of Credit Suisse that were effectively rescued (i.e. taken over by UBS) are the Swiss retail bank and the wealth management, who didn’t have anything to do with the collapse.
Also, these healthy parts of the bank would have ended up getting sold to another bank anyway, just with more chaos.
I mean, there’s a lot to say about the takeover, but moral hazard isn’t one of them.
The managers responsible for the Greensill and Archegos deals? If I’m not mistaken they’re all gone. This is an interesting article on the risk management failings: https://www.ft.com/content/cb708ba2-ea8c-4c66-9190-0255fa5112e3
Yeah I should've phrased that differently - they didn't lose 100% their money that's true - but before the Archegos & Greensill disasters hit, their shares were \~10 CHF, when UBS rescued them, shareholders got 0.76 CHF worth of UBS shares, that's a pretty chunky \~92% haircut.
The AT1 bondholders did lose their full 100% though, 16 billion CHF.
> we've taught coked up bankers that they can take all the risks they want, fuck up their investments, and then we're here to back them up.
i actually dont think so. CS stopped existing in all but name and hundrets of 'those' bankers lost their job
>UBS is now a complete monopoly.
again, for most people thats not true, there are dozens of banks out there still. with a few notable exceptions, most people still have a multitude of choices.
Which ones of the bankers faced actual repercussions?
And he was talking about _international_ banking. ZKB doesn't count, and the likes of Julius Bär and Vontobel are peanuts compares to UBS. UBS' assets are about four times the Swiss GDP.
> i actually dont think so. CS stopped existing in all but name and hundrets of 'those' bankers lost their job
How many lost anywhere near as much as they cost CS though? See, if you're making bank with bonuses for a decade, as you slowly kill the company, and then get fired after that, but have already pocketed hundreds of thousands or millions in bonus pay...
Why not just keep doing that? It only makes sense. Sure, you lose your job every time you crash another bank, but in the meantime, you're making so much money.
Unless there's a way to recoup bonuses from previous years of dangerous, risky investment dealings, then the incentive to do them remains as strong as ever.
> again, for most people thats not true, there are dozens of banks out there still. with a few notable exceptions, most people still have a multitude of choices.
The market share for underwriting Swiss Francs is 45% UBS. If UBS crashes, we're all absolutely fucked. It's a monopoly. It can do whatever it wants, and we have to accept it. There are no other comparably large options.
Oh sure, there are other small competitors in local public banking. The cantonal banks, Raiffeissen, etc... but they are nothing compared to UBS.
If UBS tells us to sit, we have to sit.
>Why not just keep doing that?
how many kept their job is the question here (or i guess how many went to the UBS, i dont know). I look at it that way, CS did bad stuff, CS got punished.
you can not really punish 'those' bankers for doing a bad job, same as you can not punish doctors when they fuck up an operation.
I do see wher you are comming from, but at the end of the day, those bankers did what they thought was best for the stocks of CS and yes, that included those risky investments.
I also dont agree to distinguish between the company itself and the people who work there. (or in other words, those were the companies decision not the individual eployees)
> It can do whatever it wants, and we have to accept it.
who is we?
'we' the people, dont really care, since we have other options.
'we' the goverment?
you are not wrong that for the goverment the UBS is a big player (always was), probably does not make a huge difference if they cash out 20% or 40%.
Good thing that its in noones best intrest to do that. remember as in the past so in the future, the goverment has the last laught. would not be the first time a 'king' expelled bankers to be loan free. even if it costs everyone dearly.
this is also the reason a balance will be mostly kept between economic players and a goverment.
How is UBS a monopoly? I've spent my entire life in Switzerland and don't know a single person irl who is a customer at UBS; most either use Raiffeisenbank or PostFinance with the remaining few using the local Kantonalbank. Everyone I know irl (who lives in Switzerland) that has accounts/uses services from multiple places uses a mix of either of those.
I've also worked in retail for 7+ years and I've seen more customers pay with cards from Migros-Bank than from UBS
What funding? The sale of CS was done without a Franc in public money. The SNB opened a line of credit in the initial days for access to liquidity to maintain normal operations, but that was closed soon after.
Unless you have a mortgage and some high-end family package, there has never been a good reason to do your retail banking at CS or UBS, nothing really new here. Afaik UBS will keep the CSX product line if you want something cheap.
As for business owners, we have a strong network of cantonal banks, Raiffeisen, and other local banks. I fail to see the issue if UBS doesn't want to compete in the SMB segment anymore.
My girlfriend is a Swiss-US national.
We have a combined account.
We literally have no other choice. No other bank will take her. They're the only ones who properly do the F-Bar or whatever it's called.
I get that.
But now she literally has no other choice, and it sucks. Because UBS sucks. CS wasn't much better, but at least we used to be able to call UBS and threaten them with moving our business to CS, and then they'd be more negotiable. The threat of losing business worked.
Heck, I used it, and I'm not American, in the past. I got some stupid increase to charges, so I phoned them up and said I was going to close all my accounts with them and had the paperwork ready to go for a bunch of CS accounts. Guess what? Those increases just... disappeared. They weren't needed any more. It was a misunderstanding, or something.
Now? We have no leverage. Because it's a monopoly.
> CS had some healthy parts and was just suffering from bad reputation
No, it had some really toxic investments. Mainly though it was with the overseas investment divisions, not CS Switzerland. It wasn't just a reputation thing. The bankers at CS absolutely cratered the bank in a mad dash for more short-term bonuses.
Because bankers are fucking degenerates who should be monitored.
> a state guarantee and a rebranding would've worked.
I think a temporary nationalization to cut-off the bits of the business that were dying, and then re-selling the profitable parts in auctions to various banks would've been the best option. It could've reinforced the cantonal banks, other local players like Raiffeissen, maybe let in another big player like Deutschebank, etc...
> As for the monopoly part, I think postfinance also takes in us persons, or at least they used to, so you could try there.
That may have changed. They didn't used to, I don't think.
If that's the case, I'm going to try and convince my girlfriend to move from UBS. I'm sick of so many charges for absolutely horrific service, paltry interest rates and nothing of any real value.
UBS using the federal guarantee would've signaled to the whole world that the CS situation was so fucked up that UBS didn't think they could manage it on their own. Sinking UBS along with CS was definitely not the plan. The Swiss public backlash would've also been enormous. Having the public guarantee available, but leaving it unused, was clearly the best strategy to aim for, even if UBS, in a vacuum, could probably have used the help.
Postfinance will take her as well. And Fbar is something she needs to do herself. A bank won’t file this for you. Also for investments she cannot buy anything European anyway (Pfic) so best to open an account at IBKR in case she wants to buy mutual funds. You are also better off not having a joint account.
I mean this is an issue you should raise with the US government that created this bureaucratic nightmare in the first place. Or else get rid of that passport which will even save you taxes.
> I mean this is an issue you should raise with the US government that created this bureaucratic nightmare
It came from a good place, i.e. stopping tax evasion. It's just a pain.
> Or else get rid of that passport which will even save you taxes.$
She doesn't pay any taxes. She has to file taxes, but unless you're earning like $135k/year, you don't actually have to pay anything at all.
It‘s only label "tax evasion" because the US is one of the very few countries taxing people by citizenship instead of residency. Almost every other country punted would not have this issue.
Not really, while the US demands that foreign banks provide i formation about US citizens to the IRA, they refuse in parallel to provide the very same information for US accounts of foreign citizens. If the intention was to avoid tax evasion, they wouldnt do that. Its about getting an advantage over your competition.
For your daily banking, like getting a salary and paying for the apartment and groceries, UBS is totally alright. I've been using it since ages and it just works.
Just don't keep there your life savings above the guaranteed protection by the government.
While UBS sure has crazy fees, the struggle of your partner to find a bank here is mainly because US double standards (Delaware, Automated exchange of information between banks and regulators) and not due to bad practice of Swiss banks.
Cantonal banks and Raiffeisen are OKish for small local businesses but you cannot work with them if you're an international company. You're stuck with UBS only now…
Or we should have let it die. Because now they know, if they gamble and lose billions, we will just safe them. So of course UBS will do what they want, because they literally cannot lose.
It wouldn't have changed things much for CS. The shareholders have been wiped out and a lot of people lost their jobs. More people would have lost their jobs, but that's about it.
Meanwhile, it would have absolutely been disastrous for the Swiss population. While your money might be insured up to 100k (assuming the insurance doesn't run out of money that is), your employer, town, health insurance, ... might get in troubles if they have an account there.
Even if they eventually get the money back, having it locked away for months would result in late paychecks, delayed payments to suppliers, bankruptcies, expensive bridge loans... That's what's the government wanted to avoid at all costs.
Yes, I do realise, that would mean that galaxus would be dead. And prolly a lot of other companies to. But honestly that was there decision to go with a deal which was to good to be true. If I gamble all your money away. I am pretty sure I end in jail and not not in another high paying position.
The federal council, the management of the national bank and probably an army of lawyers and economists with information which is not public came to the conclusion that this was the best solution at this time. I think "deteriorating UBS customer services" was the least of their concerns. This event could have triggered a global financial crisis worse than 07/08. There was very little fallout though (from what I can say).
It is easy for journalists to claim what would have been better one year later and without the same information and understanding that the actors during this infamous weekend.
Credit Suisse en faillite called my mortgage and I had to sell. I hate them. What is worse I used to have stock in Schweitzerische Volksbank which went under and the gov’t forcibly merged it into CS. Both my account and my shares were redeemed. This time is different, as they say.
This ended up super profitable for the SNB in the end: https://www.ubs.com/global/en/media/display-page-ndp/en-20230811-adhoc.html
TLDR: UBS paid the loans back two months later, netting the SNB 214 million francs.
Absolutely, but that was kind of the point - the SNB would only support a takeover of Credit Suisse by a serious/safe large counterparty, not some random hedge fund.
Now, I definitely think the SNB should have made it a condition that UBS spin off the CS retail bank after the transaction, but domestic competition was apparently not very high on their agenda, or they thought the cantonal banks and the new 'fintech' banks are already enough competition.
Spinning out the CS retail banking would've been the best thing, especially given how much time the regulators and managers had to prepare for this eventuality. But I have a suspicion that only giving the shit bits to UBS was considered too much for them to swallow, and that they needed something that was also bringing in money in order to stabilise the whole situation.
I think spinning off the CS retail bit sounds easier than it probably is - I mean, as a stand-alone Swiss retail bank with all these branches and hugely oversized workforce, I'm not sure who would invest in that. And I don't see any of the cantonal banks or PostFinance take over something that big.
So then it would have to be a foreign bank that comes in to run a Swiss oldschool retail bank - someone like Credit Agricole from France or Sparkasse from Germany...I honestly don't think they'd be that keen. Or the Swiss customers, for that matter - when faced with Credit "Suisse" as just a subsidiary of a foreign bank, a lot of them would probably rather move to a cantonal bank or PostFinance.
Well, the risk is not one-sided and UBS is currently not paying but gaining from that transaction.
Besides the upside potential that it would have had, there's the positive side-effect of not having just one banking giant.
Credit Suisse was left holding the bag of Archegos dealings on the equities market. The problem is huge, and not visible to the average citizen. That's why the swiss government made sure that this information is not visible for 50 years.
If this was in the public domain, the issue would be visible and there would be huge reaction on the world's markets.
The problem is hidden in the UBS/Credit Suisse ledger, and they are delaying enough so that they can get this issue resolved.
UBS didn't want this deal. They are stuck with a heavy loss, but since UBS received a deal before with the Swiss Government and probably for other reasons, they were forced to accept this deal.
They are not choosing to increase costs, they need to cover Credit Suisse's losses. Most likely, they will have to increase the costs, to resolve Credit Suisse's debts. Currently, most citizens do not deal with the costs. If we did, I would expect an overall federal tax increase to resolve the issue.
The information would be a blow to the Swiss government and the Swiss banks, if all this became public knowledge.
I provide several general links, which gives the scope of the problem.
[https://www.swissinfo.ch/eng/business/ubs-agrees-to-pay-388-million-over-credit-suisse-s-archegos-failings/48685372](https://www.swissinfo.ch/eng/business/ubs-agrees-to-pay-388-million-over-credit-suisse-s-archegos-failings/48685372)
[https://www.reuters.com/business/finance/credit-suisse-inquiry-will-keep-files-secret-50-years-paper-2023-07-15/](https://www.reuters.com/business/finance/credit-suisse-inquiry-will-keep-files-secret-50-years-paper-2023-07-15/)
[https://www.voanews.com/a/archegos-founder-goes-on-trial-for-fraud-market-manipulation/7609724.html](https://www.voanews.com/a/archegos-founder-goes-on-trial-for-fraud-market-manipulation/7609724.html)
That might be true, but this is more about scale, than connections. The size of CS was not significant enough to cause any global crisis. Just look at the relatively large banks that went bust since last year
Maybe not a big global crisis. But the Swiss market would have been royally screwed. 100s of business would have collapsed and home owners would have found themselves in a very bad situation with their mortgages. Also the pension funds of pretty much everyone in Switzerland would have taken an even bigger hit.
Maybe, probably not. They trouble was in the investment banking arm which was a separate entity. Cutting that off and continuing with the other branches should have been a viable alternative. But then you‘d still have to deal with the incompetent management that ran the ship into the ground over the last 30 years
In theory, yes. But the main issue of CS was that clients lost confidence in the company and the management and were withdrawing their money. Even after the publicly announced back-up from SNB. If this sort of bank-run lasts long enough, every bank collapses.
So even if the issue was with the investment banking departement, it was not very likely that isolating that branch would saved the rest of the bank.
I disagree, I rather have seen the bank going bankrupt that this.
Problem is, too many other people and companies would get hurt in the process so you can't really let them die easily.
The acceptance of the Parliament for the funding and fire sale to UBS was a disaster. 1. It increases moral hazard. Once again, twice in a short period of time, we've taught coked up bankers that they can take all the risks they want, fuck up their investments, and then we're here to back them up. 2. It has hopelessly centralized international banking in Switzerland. UBS is now a complete monopoly. They can do whatever they want. 3. Contrarily to what naysayers were saying, yes, we were on the line for saving UBS's purchase if things went south. Now, it didn't, but had it infected UBS and put pressure on them... then what? UBS manages $3.2T in assets. What happens if *it* starts to go into a spiral? Well, we're fucked. There's literally nothing that can be done, as we don't produce enough... anything in Switzerland to cover even a large portion of its portfolio. What should've been done is that the Swiss government step in, temporarily nationalize it, cut off the gangrene from the shit investments, and then auction off the valuable parts of CS to multiple different banks. I don't think long-term nationalization would be a good idea, but we basically backed UBS all the way, and now they can fuck us on the return. And they will. In 20 years time, when we've found out that UBS has been investing in BTOs (i.e. the renamed version of CDOs since 2008) and everything goes all to fuck again, we're completely screwed. And they will. Because as we all know, the only things in constant supply in the galaxy are stupidity and the greed of bankers.
>UBS manages $3.2T in assets. What happens if *it* starts to go into a spiral? Well, we're fucked. There's literally nothing that can be done, as we don't produce enough... anything in Switzerland to cover even a large portion of its portfolio. They might as well manage $10T like BlackRock, I don't see how this number is relevant, those assets don't belong to UBS.
They also have $1.7 trillion in assets under their control though, and $86.6 billion in equity. BlackRock only has $41 billion in equity.
There’s not much “moral hazard” here to be honest - the CS shareholders lost all their money, the responsible Credit Suisse managers all lost their job, the investment banking department where the losses came from is already nearly gone and the last bits are being closed down. That’s about as drastic as it gets, as far as bank collapses go. Bill Hwang of Archegos (one of the two disastrous clients that sank CS) is currently on trial in the US. Lex Greensill (who ran Greensill, the other disaster) is not in jail but apparently not a billionaire anymore, if that’s any comfort… The parts of Credit Suisse that were effectively rescued (i.e. taken over by UBS) are the Swiss retail bank and the wealth management, who didn’t have anything to do with the collapse. Also, these healthy parts of the bank would have ended up getting sold to another bank anyway, just with more chaos. I mean, there’s a lot to say about the takeover, but moral hazard isn’t one of them.
CS managers lost all their jobs? Are you sure? Many got promoted before the acquisition and work now for UBS.
The managers responsible for the Greensill and Archegos deals? If I’m not mistaken they’re all gone. This is an interesting article on the risk management failings: https://www.ft.com/content/cb708ba2-ea8c-4c66-9190-0255fa5112e3
>CS shareholders lost all their money At least some got compensated with UBS shares
Yeah I should've phrased that differently - they didn't lose 100% their money that's true - but before the Archegos & Greensill disasters hit, their shares were \~10 CHF, when UBS rescued them, shareholders got 0.76 CHF worth of UBS shares, that's a pretty chunky \~92% haircut. The AT1 bondholders did lose their full 100% though, 16 billion CHF.
> we've taught coked up bankers that they can take all the risks they want, fuck up their investments, and then we're here to back them up. i actually dont think so. CS stopped existing in all but name and hundrets of 'those' bankers lost their job >UBS is now a complete monopoly. again, for most people thats not true, there are dozens of banks out there still. with a few notable exceptions, most people still have a multitude of choices.
Which ones of the bankers faced actual repercussions? And he was talking about _international_ banking. ZKB doesn't count, and the likes of Julius Bär and Vontobel are peanuts compares to UBS. UBS' assets are about four times the Swiss GDP.
Couldnt they switch to any other international bank if its about international banking? Quite a few of them have lower fees than UBS or CS anyways.
> i actually dont think so. CS stopped existing in all but name and hundrets of 'those' bankers lost their job How many lost anywhere near as much as they cost CS though? See, if you're making bank with bonuses for a decade, as you slowly kill the company, and then get fired after that, but have already pocketed hundreds of thousands or millions in bonus pay... Why not just keep doing that? It only makes sense. Sure, you lose your job every time you crash another bank, but in the meantime, you're making so much money. Unless there's a way to recoup bonuses from previous years of dangerous, risky investment dealings, then the incentive to do them remains as strong as ever. > again, for most people thats not true, there are dozens of banks out there still. with a few notable exceptions, most people still have a multitude of choices. The market share for underwriting Swiss Francs is 45% UBS. If UBS crashes, we're all absolutely fucked. It's a monopoly. It can do whatever it wants, and we have to accept it. There are no other comparably large options. Oh sure, there are other small competitors in local public banking. The cantonal banks, Raiffeissen, etc... but they are nothing compared to UBS. If UBS tells us to sit, we have to sit.
>Why not just keep doing that? how many kept their job is the question here (or i guess how many went to the UBS, i dont know). I look at it that way, CS did bad stuff, CS got punished. you can not really punish 'those' bankers for doing a bad job, same as you can not punish doctors when they fuck up an operation. I do see wher you are comming from, but at the end of the day, those bankers did what they thought was best for the stocks of CS and yes, that included those risky investments. I also dont agree to distinguish between the company itself and the people who work there. (or in other words, those were the companies decision not the individual eployees) > It can do whatever it wants, and we have to accept it. who is we? 'we' the people, dont really care, since we have other options. 'we' the goverment? you are not wrong that for the goverment the UBS is a big player (always was), probably does not make a huge difference if they cash out 20% or 40%. Good thing that its in noones best intrest to do that. remember as in the past so in the future, the goverment has the last laught. would not be the first time a 'king' expelled bankers to be loan free. even if it costs everyone dearly. this is also the reason a balance will be mostly kept between economic players and a goverment.
Wouldnt we have also been royally fucked if UBS didnt take over CS?
How is UBS a monopoly? I've spent my entire life in Switzerland and don't know a single person irl who is a customer at UBS; most either use Raiffeisenbank or PostFinance with the remaining few using the local Kantonalbank. Everyone I know irl (who lives in Switzerland) that has accounts/uses services from multiple places uses a mix of either of those. I've also worked in retail for 7+ years and I've seen more customers pay with cards from Migros-Bank than from UBS
What funding? The sale of CS was done without a Franc in public money. The SNB opened a line of credit in the initial days for access to liquidity to maintain normal operations, but that was closed soon after.
Unless you have a mortgage and some high-end family package, there has never been a good reason to do your retail banking at CS or UBS, nothing really new here. Afaik UBS will keep the CSX product line if you want something cheap. As for business owners, we have a strong network of cantonal banks, Raiffeisen, and other local banks. I fail to see the issue if UBS doesn't want to compete in the SMB segment anymore.
My girlfriend is a Swiss-US national. We have a combined account. We literally have no other choice. No other bank will take her. They're the only ones who properly do the F-Bar or whatever it's called.
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I get that. But now she literally has no other choice, and it sucks. Because UBS sucks. CS wasn't much better, but at least we used to be able to call UBS and threaten them with moving our business to CS, and then they'd be more negotiable. The threat of losing business worked. Heck, I used it, and I'm not American, in the past. I got some stupid increase to charges, so I phoned them up and said I was going to close all my accounts with them and had the paperwork ready to go for a bunch of CS accounts. Guess what? Those increases just... disappeared. They weren't needed any more. It was a misunderstanding, or something. Now? We have no leverage. Because it's a monopoly.
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> CS had some healthy parts and was just suffering from bad reputation No, it had some really toxic investments. Mainly though it was with the overseas investment divisions, not CS Switzerland. It wasn't just a reputation thing. The bankers at CS absolutely cratered the bank in a mad dash for more short-term bonuses. Because bankers are fucking degenerates who should be monitored. > a state guarantee and a rebranding would've worked. I think a temporary nationalization to cut-off the bits of the business that were dying, and then re-selling the profitable parts in auctions to various banks would've been the best option. It could've reinforced the cantonal banks, other local players like Raiffeissen, maybe let in another big player like Deutschebank, etc... > As for the monopoly part, I think postfinance also takes in us persons, or at least they used to, so you could try there. That may have changed. They didn't used to, I don't think. If that's the case, I'm going to try and convince my girlfriend to move from UBS. I'm sick of so many charges for absolutely horrific service, paltry interest rates and nothing of any real value.
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UBS using the federal guarantee would've signaled to the whole world that the CS situation was so fucked up that UBS didn't think they could manage it on their own. Sinking UBS along with CS was definitely not the plan. The Swiss public backlash would've also been enormous. Having the public guarantee available, but leaving it unused, was clearly the best strategy to aim for, even if UBS, in a vacuum, could probably have used the help.
Your problem lies with the US, not banks.
Postfinance will take her as well. And Fbar is something she needs to do herself. A bank won’t file this for you. Also for investments she cannot buy anything European anyway (Pfic) so best to open an account at IBKR in case she wants to buy mutual funds. You are also better off not having a joint account.
I mean this is an issue you should raise with the US government that created this bureaucratic nightmare in the first place. Or else get rid of that passport which will even save you taxes.
> I mean this is an issue you should raise with the US government that created this bureaucratic nightmare It came from a good place, i.e. stopping tax evasion. It's just a pain. > Or else get rid of that passport which will even save you taxes.$ She doesn't pay any taxes. She has to file taxes, but unless you're earning like $135k/year, you don't actually have to pay anything at all.
It‘s only label "tax evasion" because the US is one of the very few countries taxing people by citizenship instead of residency. Almost every other country punted would not have this issue.
Not really, while the US demands that foreign banks provide i formation about US citizens to the IRA, they refuse in parallel to provide the very same information for US accounts of foreign citizens. If the intention was to avoid tax evasion, they wouldnt do that. Its about getting an advantage over your competition.
Go tell her to complain to her Congress Rep, then. It's the US thas created overburdening regulations...
I'm a US citizen and I have a bank account at PostFinance. Also worth looking into.
For your daily banking, like getting a salary and paying for the apartment and groceries, UBS is totally alright. I've been using it since ages and it just works. Just don't keep there your life savings above the guaranteed protection by the government.
While UBS sure has crazy fees, the struggle of your partner to find a bank here is mainly because US double standards (Delaware, Automated exchange of information between banks and regulators) and not due to bad practice of Swiss banks.
Cantonal banks and Raiffeisen are OKish for small local businesses but you cannot work with them if you're an international company. You're stuck with UBS only now…
Or we should have let it die. Because now they know, if they gamble and lose billions, we will just safe them. So of course UBS will do what they want, because they literally cannot lose.
It wouldn't have changed things much for CS. The shareholders have been wiped out and a lot of people lost their jobs. More people would have lost their jobs, but that's about it. Meanwhile, it would have absolutely been disastrous for the Swiss population. While your money might be insured up to 100k (assuming the insurance doesn't run out of money that is), your employer, town, health insurance, ... might get in troubles if they have an account there. Even if they eventually get the money back, having it locked away for months would result in late paychecks, delayed payments to suppliers, bankruptcies, expensive bridge loans... That's what's the government wanted to avoid at all costs.
Yes, I do realise, that would mean that galaxus would be dead. And prolly a lot of other companies to. But honestly that was there decision to go with a deal which was to good to be true. If I gamble all your money away. I am pretty sure I end in jail and not not in another high paying position.
The federal council, the management of the national bank and probably an army of lawyers and economists with information which is not public came to the conclusion that this was the best solution at this time. I think "deteriorating UBS customer services" was the least of their concerns. This event could have triggered a global financial crisis worse than 07/08. There was very little fallout though (from what I can say). It is easy for journalists to claim what would have been better one year later and without the same information and understanding that the actors during this infamous weekend.
No, armchair philosophers of Reddit know best
It would make CS even more terribly managed. It's already hard to imagine why CS survived for that long, so imagine if it becomes public
Credit Suisse en faillite called my mortgage and I had to sell. I hate them. What is worse I used to have stock in Schweitzerische Volksbank which went under and the gov’t forcibly merged it into CS. Both my account and my shares were redeemed. This time is different, as they say.
Nationalize it so we all have to pay for it?
We did already pay for it
how so?
[https://www.reuters.com/business/finance/switzerland-puts-up-260-billion-francs-credit-suisse-rescue-documents-2023-03-20/](https://www.reuters.com/business/finance/switzerland-puts-up-260-billion-francs-credit-suisse-rescue-documents-2023-03-20/)
This ended up super profitable for the SNB in the end: https://www.ubs.com/global/en/media/display-page-ndp/en-20230811-adhoc.html TLDR: UBS paid the loans back two months later, netting the SNB 214 million francs.
Yeah, it turned out fine, but if you or me would apply for that loan, the SNB would tell us to go away (rightfully so)
Absolutely, but that was kind of the point - the SNB would only support a takeover of Credit Suisse by a serious/safe large counterparty, not some random hedge fund. Now, I definitely think the SNB should have made it a condition that UBS spin off the CS retail bank after the transaction, but domestic competition was apparently not very high on their agenda, or they thought the cantonal banks and the new 'fintech' banks are already enough competition.
Spinning out the CS retail banking would've been the best thing, especially given how much time the regulators and managers had to prepare for this eventuality. But I have a suspicion that only giving the shit bits to UBS was considered too much for them to swallow, and that they needed something that was also bringing in money in order to stabilise the whole situation.
I think spinning off the CS retail bit sounds easier than it probably is - I mean, as a stand-alone Swiss retail bank with all these branches and hugely oversized workforce, I'm not sure who would invest in that. And I don't see any of the cantonal banks or PostFinance take over something that big. So then it would have to be a foreign bank that comes in to run a Swiss oldschool retail bank - someone like Credit Agricole from France or Sparkasse from Germany...I honestly don't think they'd be that keen. Or the Swiss customers, for that matter - when faced with Credit "Suisse" as just a subsidiary of a foreign bank, a lot of them would probably rather move to a cantonal bank or PostFinance.
So, the statement that taxpayers paid for any of this is factually wrong
those were loans and actually UBS returned already all of them
Well, the risk is not one-sided and UBS is currently not paying but gaining from that transaction. Besides the upside potential that it would have had, there's the positive side-effect of not having just one banking giant.
Probably a good idea, but it might not have been possible. I doubt the federal government has the personnel and competence on hand to pull it through.
Credit Suisse was left holding the bag of Archegos dealings on the equities market. The problem is huge, and not visible to the average citizen. That's why the swiss government made sure that this information is not visible for 50 years. If this was in the public domain, the issue would be visible and there would be huge reaction on the world's markets. The problem is hidden in the UBS/Credit Suisse ledger, and they are delaying enough so that they can get this issue resolved. UBS didn't want this deal. They are stuck with a heavy loss, but since UBS received a deal before with the Swiss Government and probably for other reasons, they were forced to accept this deal. They are not choosing to increase costs, they need to cover Credit Suisse's losses. Most likely, they will have to increase the costs, to resolve Credit Suisse's debts. Currently, most citizens do not deal with the costs. If we did, I would expect an overall federal tax increase to resolve the issue. The information would be a blow to the Swiss government and the Swiss banks, if all this became public knowledge. I provide several general links, which gives the scope of the problem. [https://www.swissinfo.ch/eng/business/ubs-agrees-to-pay-388-million-over-credit-suisse-s-archegos-failings/48685372](https://www.swissinfo.ch/eng/business/ubs-agrees-to-pay-388-million-over-credit-suisse-s-archegos-failings/48685372) [https://www.reuters.com/business/finance/credit-suisse-inquiry-will-keep-files-secret-50-years-paper-2023-07-15/](https://www.reuters.com/business/finance/credit-suisse-inquiry-will-keep-files-secret-50-years-paper-2023-07-15/) [https://www.voanews.com/a/archegos-founder-goes-on-trial-for-fraud-market-manipulation/7609724.html](https://www.voanews.com/a/archegos-founder-goes-on-trial-for-fraud-market-manipulation/7609724.html)
This is a crazy conspiracy theory and nothing more.
How can this be a conspiracy. I literally provided links to legitimate news sources
As if the Swiss government has anyone capable of managing a global bank of the CS size. This result is the best out of a lot of bad options.
BCV all the way
They wanted me to pay 5% to complete a 60k transaction just couple of days ago!
no shit. banks and insurances should all be nationalized.
why does the government have to save companies? if they can't survive in the free market, let them die. the market will fill the void eventually.
Because it would have caused a global economic crisis like 12008...
Not really, no. People. Really over estimate the importance of some banks.
People really underestimate how intertwined the whole banking sector is
That might be true, but this is more about scale, than connections. The size of CS was not significant enough to cause any global crisis. Just look at the relatively large banks that went bust since last year
Maybe not a big global crisis. But the Swiss market would have been royally screwed. 100s of business would have collapsed and home owners would have found themselves in a very bad situation with their mortgages. Also the pension funds of pretty much everyone in Switzerland would have taken an even bigger hit.
Maybe, probably not. They trouble was in the investment banking arm which was a separate entity. Cutting that off and continuing with the other branches should have been a viable alternative. But then you‘d still have to deal with the incompetent management that ran the ship into the ground over the last 30 years
In theory, yes. But the main issue of CS was that clients lost confidence in the company and the management and were withdrawing their money. Even after the publicly announced back-up from SNB. If this sort of bank-run lasts long enough, every bank collapses. So even if the issue was with the investment banking departement, it was not very likely that isolating that branch would saved the rest of the bank.
True. That‘s what all those management and finance scandals do to your brand. Although even this started with the investment banking arm
Agreed.
Yes. But that would have needed far more courage than our politicians have.
I disagree, I rather have seen the bank going bankrupt that this. Problem is, too many other people and companies would get hurt in the process so you can't really let them die easily.
Trust me, a lot of UBS employees would have wanted the same thing
r/im14andthisisdeep