Switzerland's Economy
The Fall of Credit Suisse
How scandals, losses and a bank run led to Credit Suisse's emergency takeover by UBS in March 2023, and the debate over too-big-to-fail banks.
Credit Suisse, founded in 1856, was one of Switzerland’s two largest banks.
Troubles
- Years of scandals and losses, including from Greensill Capital and Archegos in 2021.
- Management turmoil and weak profits.
The run
- In March 2023, after US regional bank failures, clients withdrew billions.
- Confidence collapsed.
The rescue
- On 19 March 2023, Swiss authorities arranged a takeover by UBS for about 3 billion francs.
- The government and SNB provided guarantees and liquidity.
- AT1 bonds worth about 16 billion francs were written to zero, angering investors.
Too big to fail
- UBS became an even larger bank, with a balance sheet roughly twice Swiss GDP.
- Switzerland proposed tougher capital rules for UBS in 2025.
Lesson
Even old, respected banks can fail when confidence collapses; large banks pose risks to small countries.
The weekend rescue
Over a single weekend in March 2023, officials merged Switzerland's two biggest banks to prevent a wider crisis.
Thinking famous banks can't fail
Credit Suisse collapsed after 167 years.
Key takeaways
- Credit Suisse suffered years of scandals and losses.
- A run in March 2023 collapsed confidence.
- UBS took it over on 19 March 2023.
- UBS is now very large relative to Swiss GDP.
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