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The fountain, a work of art, is stunning, surrounded by columns and marble tiles in the middle of the Credit Suisse courtyard: “Fontaine du désir”. As the “source of desire” seems to be bubbling more than ever, the lights of the traditional house in the heart of Zurich can now go out forever.
Some people may feel chills down their spine with this thought. Credit Suisse is systematically important, extremely important to our financial center and our economy – among others, it keeps the payment transactions of Swiss companies and small savers working. A big bank with an equally great history.
At that time, 167 years ago, Switzerland was a developing country for banks. Not quite suitable for the industrial revival that Alfred Escher (1819-1882) was striving for. To finance railway expansion in Switzerland, the father of modern Switzerland established his own bank, the first in the city of Zurich: Schweizerische Kreditanstalt (SKA).
The first bank of the city of Zurich
The SKA begins its activities on July 16, 1856 – its first seal consists of three folded initials. Escher at that time was only 37 years old. Its customers were manufacturers and the liberal liberal bourgeoisie.
Escher opened the SKA headquarters at Paradeplatz in 1873. While foreign media still compare this magnificent building to a grand hotel, the UBS property across the street looks like an immigration office that stopped working in the 1980s.
At that time the credit institution was not only financing the construction of the railway. Rentenanstalt (now Swiss Life) was originally a branch of SKA. Provided startup assistance at Escher-Bank, Schweizer Rück (Swiss Re), Helvetia Feuer, Schweizerische Allgemeine, Versicherungsverein (Zurich Financial Services), Basler Handelsbank and Bankverein (today UBS).
The Chiasso scandal and Rainer E. Gut
The credit institution not only provided start-up support to important companies, it also caused scandals. The first major event was the Chiasso scandal of 1977. Last year the bank gave him SKA blue and a new seal (“Wermelinger Cross”) for the anniversary and distributed nearly a million ski hats for PR purposes. A billion dollar fraud case broke out in Ticino – the banking company, the bank union and the national bank wanted to help with the loan, but SKA refused the loans and overcame the crisis with its own resources.
In the year of the Chiasso scandal Rainer E. Gut (90) became the head of the credit institution. With the powerful Swiss bank manager and today Honorary President of Credit Suisse, the bank grew into an international group and a global player in the 1980s. American investment banking culture prevailed.
credit institution on Wall Street
In 1988, CS First was founded on Wall Street in Boston, New York. A year later it was imposed on CS Holding, SKA and other holdings. This build did not last long. In 1997 it became the Credit Suisse Group with four autonomous business units. The venerable name SKA is lost.
High risks, high profits, high bonuses: Swiss banking tradition of wealth management is increasingly overshadowed by Anglo-Saxon profit maximisation.
The excesses of the latter are manifested in the financial crisis. In February 2007, CS CEO of the time, Oswald Grübel (79), announced his resignation with the presentation of record results. Investment banker Brady W. Dougan (63) takes over.
UBS needs government assistance, CS can do without it
UBS should have been bailed out by the state in 2008, while rival Credit Suisse could survive without billions of dollars of direct government aid. In return, he takes the Qataris on board in an unfavorable deal.
At the same time, an economic crisis of historic proportions is intensifying. What started with completely incomprehensible banking transactions has thrown the entire world economy into turmoil. Governments around the world are trying to prevent the worse from happening with their aid campaigns. Regulations have also been expanded in Switzerland.
On the 150th anniversary of Escher Bank, the group was restructured. It gets a new logo and misses its one-bank strategy. As part of legislation that was too big to go bankrupt at the end of 2016, the large bank’s Swiss business was transferred to the newly formed Credit Suisse (Switzerland) AG. With Tidjane Thiam (60) as head of CS, who was overthrown as Minister of Ivory Coast in 1999, the bank will be made attractive again for customers in the domestic market.
It is distasteful only then that setbacks, scandals and missteps of the administration begin. Now with sad consequences for a great bank with a great history that the bronze statue of visionary and bank founder Alfred Escher at the main train station in Zurich will also remind our grandchildren.
Source :Blick
I’m Tim David and I work as an author for 24 Instant News, covering the Market section. With a Bachelor’s Degree in Journalism, my mission is to provide accurate, timely and insightful news coverage that helps our readers stay informed about the latest trends in the market. My writing style is focused on making complex economic topics easy to understand for everyone.
