When: Monday, May 22, 2023, 5:00 PM - 6:00 PMWhere: Online
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The London Financial Regulation Seminar is an inter-collegiate and inter-disciplinary group of experts led by CCLS and our Institute of Banking and Finance under the leadership of Professor Rosa M. Lastra and Dr. Daniele D’Alvia.
On Monday 22 May 2023, Dr Reto Schiltknecht discussed the rescue of Credit Suisse and how this deal was set up, and whether or not the objectives have been achieved. Professor Lastra chaired the event.
Dr. Reto Schiltknecht holds the position of Senior Counsel at the Zurich-based consulting firm Geissbuhler Weber & Partner where he is responsible for the firm’s risk management and regulatory practice. He is an expert in crisis management, and capital markets including regulatory capital instruments, and licensing issues for banks and financial market participants. In 2010 he joined the Swiss Financial Market Supervisory Authority (FINMA) as Head of the Solvency and Capital Group within the Banks’ Supervisory Division and he was since August 2016 responsible for International Affairs and Policy Issues as well as Deputy Head of FINMA’s Recovery and Resolution Division. He also was a member of the Resolution Steering Committee and the Cross-border Crisis Management Group of the Financial Stability Board (FSB). He regularly publishes in financial markets law and is a frequent speaker at international conferences.
On 19 March 2023, Swiss banking group UBS Group AG agreed to merge with Credit Suisse for CHF 3 billion in a deal backed by the Swiss government, the Swiss Central Bank, and the Swiss Financial Market Supervisory Authority. Indeed, the Swiss Central Bank supported the deal by providing more than CHF 200 billion in liquidity, while the Swiss Government provided a guarantee to UBS to cover losses of up to CHF 9 billion. Additionally, CHF 16 billion of Additional Tier 1 bonds were written down to zero. Dulcis in fundo, at the beginning of April 2023, the Swiss prosecutors opened an investigation into possible illegal activity in connection with government support for UBS’s rushed merger of Credit Suisse.
Dr Schiltknecht provided us with a thorough and precise analysis of the facts and analyse the possible legal and economic issues of UBS – Credit Suisse transaction and the possible concerns of creating ‘large banks’ via market consolidation. In fact, this might have eventually posed further questions of systemic risk that might be one day unanswerable.
