The emergency takeover of Credit Suisse by UBS for a pittance and solid financial guarantees from the authorities has been heavily criticised in Switzerland.

"All other options were, in our view, riskier for the state, the taxpayer, the Swiss financial centre and international markets," says Keller-Sutter.

She said she had come to the conclusion in recent weeks that although liquidating a global systemically important bank like Credit Suisse is legally possible thanks to the "too big to fail" law, "in practice, the economic damage would be considerable."

In addition, she argues, "Switzerland would have been the first country to liquidate a global systemically important bank." "This was clearly not the time to experiment."

The government, the Swiss central bank (SNB) and Finma, the policeman of the markets in Switzerland, "agreed that a restructuring or bankruptcy of the CS with a separation of Swiss activities, as provided for in the +too big to fail+ contingency plan, would probably have triggered an international financial crisis," says the minister.

According to a poll published Friday by the Swiss public broadcaster, a majority of Swiss (54%) disagree with UBS's takeover of Credit Suisse.

"That many have rage in their stomachs, I understand it very well," says the minister. "I confess that I too find it difficult to accept it. Especially when management errors contributed to this situation", but, she continues, "the solution adopted was the one that best protected everyone".

In the event of nationalization, she explains, the Confederation would have had to assume all the risks.

Keller-Sutter also maintains that no foreign pressure has been exerted on Switzerland. "No one pushed us in any particular direction. But it was clear to everyone, including ourselves, that a restructuring or liquidation of the SC would cause serious international disruption in the financial markets."

The minister also brushes aside those who accuse the authorities of acting too late when Credit Suisse had been in turmoil for two years, entangled in a series of scandals.

Swiss Finance Minister Karin Keller-Sutter and Credit Suisse Chairman Axel Lehmann, March 19, 2023 in Bern © Fabrice COFFRINI / AFP

"My department, the SNB and FINMA discussed emergency scenarios as early as January – on my second day as finance minister. It had to be done behind the scenes so as not to damage trust in CS," she said.

And "I informed the entire Federal Council (government) of the emergency scenarios at the beginning of February," she added.

© 2023 AFP