The banks should never again have to be rescued by the states – that was the aim of regulation in the wake of the global financial crisis. Now the example of Credit Suisse shows that in the end only states and the central banks can prevent a crash
It was a big promise that the governments made after the global financial crisis of 2007 to 2009: never again should the states use taxpayers’ money to bail out banks, never again should the central banks finance the high-risk business of the credit institutions with liquidity aid retrospectively. For this reason, a comprehensive set of rules was created, including on equity and liquidity buffers, which is accompanied by regular stress tests. Banks should become safer; the eurozone has even created its own authority to wind down banks in an emergency.
Source: Stern
