Credit Suisse faces possible disciplinary proceedings: Switzerland's banking regulator

Credit Suisse Group AG faces the threat of a possible probe and disciplinary action over how top managers ran the bank in the lead-up to its collapse and takeover by UBS Group AG, Switzerland's banking regulator told NZZ am Sonntag.

"CS had a cultural problem that translated into a lack of accountability," Finma President Marlene Amstad told the Sunday newspaper. "Often it was not clear who was responsible for what. This favored a negligent handling of risks."

Whether to start fresh proceedings remains an "open question," she said, adding, "we're not a law enforcement agency, but we're exploring options."


A spokesman for Credit Suisse declined to comment.

The government-brokered purchase of Credit Suisse by UBS last weekend has been criticized by both politicians and ordinary citizens in Switzerland. Finma, in particular, has come under scrutiny for whether it should've done more to prevent Credit Suisse's collapse.

Amstad refuted the suggestion that Finma didn't intervene early or aggressively enough to tackle Credit Suisse's problems, pointing to the six enforcement proceedings against the bank in recent years.

"We intervened earlier, and very intensively, where there were breaches of supervisory law. But especially when we act harshly, it usually doesn't become public," she told NZZ. "Imagine if it had become known that we were already working on CS's restructuring order in November or that we had asked CS to prepare alternative solutions for the case that had just occurred."

To address concerns about the merged bank being too big to fail, Amstad said in the future, UBS will face "progressively higher capital and liquidity requirements."

Amstad said she welcomes discussion about giving the regulator new powers such as the ability to fine individuals or banks.