Swiss bank UBS fell victim to its high-risk strategy of expansion in the US market when the financial crisis erupted ten years ago. But the Swiss government and central bank’s plan to bail out UBS was not only successful, but profitable too.
“We are not surprised by the development of the financial markets in recent weeks, but we have been surprised by the speed in which the crisis has deteriorated,” said the then Swiss president Pascal Couchepin. In his address to the media on October 16, 2008 Couchepin outlined the measures taken by the government and the Swiss National Bank (SNB) to rescue the largest Swiss bank.
The tension in the press room was palpable. After the grounding in 2001 of Swissair, a national icon, Switzerland was in danger of losing another flagship company.
This time, the consequences would have been far more dramatic. In Switzerland alone, the collapse of UBS would have threatened the savings of one million private customers and the current accounts of 300,000 companies. Along with Credit Suisse, the banking giant held 60% of the market for loans to small- and medium-sized enterprises in Switzerland.
