Swiss Regulators Need To Own Credit Suisse Failures

In a recent article in the Financial Times, Daniel Davies, author of Lying for Money: How Legendary Frauds Reveal the Workings of Our World, called upon Switzerland's regulators to own up to the failures that led to Credit Suisse's collapse.

Davies pointed out what he sees as a striking contrast between the Swiss National Bank (SNB) and the US Federal Reserve's response to recent market turmoil. In his report on the failure of Silicon Valley Bank, the Fed’s Vice Chair for Supervision, Michael Barr, criticized supervisors for inadequate action, without suggesting there were shortcomings in the regulatory rulebook. Conversely, the SNB defended the steps taken by its supervisors, but proposed a comprehensive set of changes to bank regulation. It is arguable, however, that both regulation and supervision require a rethink if we are to resolve the underlying problems successfully.