Swiss Regulator Investigating Credit Suisse’s Final Months, According to Report

ZURICH (Reuters) – The Swiss financial market regulator, FINMA, has initiated an audit of Credit Suisse’s actions leading up to its acquisition by UBS in 2023. This information was reported by the Swiss newspaper SonntagsZeitung.

The audit will focus on the 15 months preceding the government-brokered merger in March 2023. To aid in this process, FINMA has conducted interviews with nearly a dozen current and former employees from both banks.

To facilitate the evaluation of Credit Suisse’s crisis management, FINMA has commissioned the law firm Wenger Plattner to conduct the interviews. This action followed a “secret” order from FINMA issued in September 2023, signaling the regulator’s intent to review how Credit Suisse managed the situation during the crisis. The interviews will help determine if the bank’s management misled authorities about the bank’s condition.

Requests for comments from FINMA, Wenger Plattner, the Swiss finance ministry, and the Swiss National Bank went unanswered, and UBS declined to provide a statement.

The investigation will examine several critical issues, such as when it became apparent that Credit Suisse was beyond saving, the state of the bank’s liquidity, the condition of its equity, and the overall effectiveness of its management.

In a report released in December, FINMA indicated that Credit Suisse was on the verge of collapse months ahead of its takeover and has called for enhanced regulatory powers to supervise financial institutions.

A parliamentary committee in Switzerland, which has been looking into the authorities’ response to Credit Suisse’s fall, is expected to publish its findings later this year.

In April, Swiss authorities announced a series of measures—including stricter capital requirements for UBS—to prevent a reoccurrence of the Credit Suisse crisis. A parliamentary discussion on these proposals is anticipated following the committee’s report.

Critics of the Credit Suisse acquisition argue that Swiss authorities could have preserved the bank as an independent entity but were slow to react and did not provide adequate assurances regarding its survival. Authorities, however, have defended their response, attributing the collapse to failures within Credit Suisse itself.