Imagine a country where the two largest banks have a combined balance sheet seven times the size of the nation’s GDP.
That’s Switzerland, where too-big-to-fail takes on a whole new meaning since both Credit Suisse and UBS make the small country their home.
After bailing out UBS during the crisis, and watching Credit Suisse scramble for private capital as well, many Swiss appear to have had enough.
AFP: Swiss industrialists and politicians from the Socialist and right wing parties formed a rare alliance Friday to call for the country’s two banking giants UBS and Credit Suisse to reduce their size.
“If the two big banks were to collapse, Switzerland would be in unmeasurable difficulties,” said signatories of a declaration that warned against the size of the two banks.
The declaration was signed by the Socialist Party, the Swiss right wing party SVP, Swatch group chairman Nicolas Hayek and the Federation of the Swiss Watch Industry.
It also called for the Swiss National Bank and the Swiss financial markets watchdog Finma to “develop a strategy to regulate, once and for all, the question of too big to fail.”