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The Swiss are stricter on the banks than us

Ben Chu

oswald gruebel credit suiss 150x150 The Swiss are stricter on the banks than usThe Financial Times front page (subscription) this morning features a blistering attack from Oswald Grubel, the chief executive of the giant Swiss bank UBS, on the British government for being too rough with the City of London.

“Only behind closed doors do they pay lip service to wanting to keep the City. If it is abandoned by the Government one day, God help you…If in one part of the world you have an 8 per cent capital requirement, and in another part of the world a 19 per cent…you don’t have to threaten, you know where the business is going.”

What’s rather played down, though, both by Mr Grubel and the FT report, is the fact that the Swiss government has imposed much more extensive capital requirements on its own large banks than the British authorities have on UK megabanks.

UBS and Credit Suisse will have to hold low-risk reserves equal to 10 per cent of their total risky assets, plus 9 per cent of their debt in convertible bonds (debt that converts to equity in crisis). This is considerably tougher than the  Basel III capital requirements agreed last year by the world’s central banks and regulators, which only requires banks to hold 7 per cent of their risky assets in capital.

We sometimes hear from banking lobbyists and the sector’s sympathisers in the media that bankers will flee to places like Switzerland if we in Britain regulate them, or impose structural reform. But the fact is that, when it comes to capital, Switzerland has been stricter on the banks than us.

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  • Aberrant_Apostrophe

    Init?

  • http://ritualabuse.us/ritualabuse/ Weeble13

    The problem was investment banking…..specifically an issue with its regulatory regime that was very lax in the UK due basically to the Reganomics factor – the ‘purity of the market’, and friends in the city scene. Pre city ‘big bang’ this wouldn’t have been an issue. Monetarist/evanjelical free enterprise believer polititions created this relaxation of regulation and practice in the city of London. Some bankers/city people perhaps influenced this policy change, but who actually made the laws and regulations that created the financial instrument bubble/bust? Politions/government/parliament…and then business does its job to maximise profits within the legal framework. Generally no laws were broken. The fault if anyone is to fault lays with parliament/government – and the half awake fools that elect these pyscopathic players. Yes capitalist greed can be blamed, which is why capitalism needs regulation. If you wanna hang anyone, hang Thatcher, Blair and Brown…and give Cameron a good fagging or whatever the silly public school chappy so and so’s call it.

  • http://ecestudyaid.blogspot.com/ Jony

    nice post…………..

  • lux.veritas

    I wouldn’t wrap my chips with any MSM, as for the Times and FT; I wouldn’t wipe my a** with it. Hopefully that’s clear enough for the aloof, smug, conceited ignorant scum of society that it panders to, purporting high standards of journalism, to which I would say is mere verbal diarrhoea from those who mastered the use of a thesaurus, dictionary and word processor and gave oral sex to the head boy at ox-came-city.

    Economics 101 for the north western hemisphere morally self-righteous brainwashed sheeple. Banks; above all, central banks, produce NOTHING but debt in the real world production and consumption economics as opposed to insanomics of legally fraudulent money, usury, cartels and monopolies which people foolishly believe is a free market. Legalised usury and of course debt based fiat unsustainable currencies for wealth transfer is what there is folks. Don’t take my word for it. Less than one hour reading certain summarised published documentation will stop you ever buying a financial propaganda publication again.

    As for the City of London; research why the Queen has to submit to a ritual to enter. The city and the insane scum that hold the keys would serve the world best by taking a long walk of a short plank. I am not a violent person by any stretch of the imagination, but I would lose no sleep if certain cancerous elements within the halls of political, financial and corporate power were cleansed from the earth along with their ecosystem genocide psychosis.

    Remove the human rights afforded to corporations who do not have accountability, a moral or ethical compass and who purchase judges and politicians. Remove the rights to print legally fraudulent currency by central banksters run for private wealth transfer interests.

    You have just read a couple of various fundamentally and socially important elements of economics hardly, if ever touched upon in the halls of higher education. Have you ever wondered why?

    Addendum: I could not help but notice the sneering portrait. He smacks of a man whom has had is soul, humanity, ethics and morality amputated, perhaps he never had any. I marvel at the woman or man who would partner and possibly allow to father offspring from this creature.


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