Credit Suisse’s Collapse Reveals Some Ugly Truths About Switzerland for Investors
- Nation has long traded on its image as a bastion of certainty
- Law professor says Swiss made to look like a ‘Banana Republic’
This article is for subscribers only.
For decades, Switzerland has sold itself as a haven of legal certainty for bond and equity investors. The collapse of Credit Suisse Group AG revealed some unpleasant home truths.
In the race to secure UBS Group AG’s purchase of its smaller rival over the weekend, the government invoked the need for stability and emergency legislation to override two key aspects of open markets: competition law and shareholder rights. Then bondholders discovered that $17 billion worth of so-called Additional Tier 1 debt was worthless.