Switzerland's parliament rejected the government's aid for Credit Suisse. Banks are failing and going bankrupt around the globe. At the same time, some large banks may seriously damage the financial system and even cause a global financial crisis. To curb the crisis in the banking sector, governments have to engage and save troubled banks. Recently, several US banks have collapsed. The US authorities had to shoulder the responsibility of depositors and managed to contain the crisis. However, such an approach jeopardizes the system of market relations. It turns out that depositors and banks may completely disregard risks in the future and expect the government to come to their aid in case of problems. In this connection, Switzerland’s parliament refused to rescue Credit Suisse and rejected the government's 109 billion Swiss francs ($120.82 billion) aid for the bank's merger with UBS. President Alain Berset said that the bankruptcy “would potentially have created an international financial crisis with devastating effects for Switzerland.” He added that the regulators should have taken measures to save the bank. Swiss Finance Minister Karin Keller-Sutter pinpointed that the approved refusal gave a clear signal to global markets that the country’s financial system was not resilient. Notably, the parliament’s decision will not affect the second-largest bank’s takeover by a larger bank UBS. The canton declared a state of emergency in its territory and passed the bill without legislative approval.
