Report: Tiered withdrawals and fees could particularly affect wealthy customers: Stricter account terms aimed at preventing bank runs

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Swiss federal authorities and banks are apparently considering new measures to prevent another bank run following the tumultuous bailout of Credit Suisse earlier this year. This was reported by the Reuters news agency on Friday, citing four sources familiar with the matter.

There was a huge increase in deposits at some regional US banks and Credit Suisse earlier this year. Some banks went bankrupt. Regulators were forced to intervene to prevent a wider financial crisis.

It warns that the risk of bank runs is increasing in the age of digital banking.

Phased withdrawal of larger sums or a penalty fee?

Accordingly, a comprehensive review of Swiss banking regulations is also ongoing. Leading Swiss banks appear to be under scrutiny. Reuters writes that the measures being discussed “could particularly affect wealthy customers.”

This should make it possible for larger withdrawals to be spread out over longer periods of time. “Charging fees for withdrawals is also an alternative being discussed,” two of the sources said.

Customers who do not touch their savings for a long time should be rewarded with higher interest rates.

The federal government wants to submit a report in spring 2024

The talks are said to be at an early stage. The Swiss National Bank (SNB) and the Swiss Ministry of Finance are participating in negotiations with financial institutions.

According to a representative of the Federal Ministry of Finance (EFD), discussions about bank management are “part of the overall assessment of too-big-to-fail regulations in Switzerland.” The federal government wants to submit a report on this next spring.

The SNB says a review of too-big-to-fail rules focusing on so-called systemically important banks has not yet been completed. The SNB refuses to comment on ongoing discussions. UBS also declined to comment when asked.

Source :Blick