Toughening Swiss bank regulation faces a test, experts say

03/31/2011 | Wall Street Journal, The

Regulators in Switzerland are striving to toughen rules for major banks UBS and Credit Suisse, but the proposal could run into headwinds as an election approaches, experts said. The proposal goes beyond the Basel III requirements on capital and liquidity. "  'Too big to fail' might become a footnote because Swiss voters are going to be more interested in bonuses, which is an easier topic for them to understand and for politicians to explain, even though 'too big to fail' is by far the more important one from an economic perspective," said Joerg Baumberger, a professor at the University of St. Gallen.

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