Switzerland

Five questions the UBS investigations must answer

19 September 2011

The $2.3 bln rogue trading scandal raises questions about the Swiss bank’s cash management, internal controls, and supervision of its traders. It also points to structural flaws in the market for exchange-traded funds. Here’s what investigators and regulators should focus on.

How could UBS not have learnt from SocGen?

15 September 2011

Unauthorised trades that cost the Swiss bank $2 bln took place in the same area that spawned a $7 bln fraud at SocGen in 2008. “Delta One” is meant to be a low-risk client-focused unit. One theory is that related arbitrage trades went awry. Right or wrong, it’s still baffling.

Rogue trader puts UBS investment bank at risk

15 September 2011

The source of unauthorised trades that triggered a $2 bln loss is unclear. But the bombshell is a blow to the Swiss lender’s claim that its de-risked trading business poses no threat to its private bank. Though UBS can weather the financial hit, a break-up is back on the agenda.

Swiss franc defence will work – at a price

6 September 2011

If the Swiss National Bank keeps its promise to buy “unlimited quantities” of foreign currency, its effort to peg the franc should succeed. Given the euro’s big risks, the central bank may lose money again. But the gamble is an attempt to prevent recession and deflation.

UK/Swiss deal good for taxpayers, banks and crooks

25 August 2011

Two years ago UK investors with untaxed assets in Swiss bank accounts looked like they would lose their anonymity. Instead, they will now pay almost the full tax rate to the UK, helping it cut its deficit. The Swiss banking model is protected - but dodgy money will remain shielded.

Financial lifeboats starting to get crowded

11 August 2011

Safety from sinking stocks has been sought in Treasuries, and even bonds backed by U.S. homes. But other places of refuge like the Swiss franc and gold showed on Thursday how quickly they can be rocked when too many investors pile in. Havens aren’t immune to mania either.

Sweet Swiss-German tax deal will be hard to repeat

11 August 2011

Bern has agreed to collect tax and penalties from accounts held by tax-dodging Germans. But Swiss bank secrecy remains intact, and lenders will avoid prosecution for past crimes. The revenue hit is also manageable. An investigation by U.S. authorities is unlikely to end so well.