About a year-and-a-half after the collapse of crypto-friendly banks in the US, European players are pushing to reinvigorate the market for around-the-clock payments in the digital-asset sector, Bloomberg News reported. A pair of Swiss lenders — AMINA Bank AG and Sygnum Bank AG — have debuted real-time payment and settlement networks in recent weeks. They are targeting a gap in the market left by the Silvergate Exchange Network (SEN) and Signature Bank’s Signet platform which, prior to their collapse in March 2023, played a crucial role in bringing liquidity to the crypto market.
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Switzerland
Swiss inflation unexpectedly eased — offering reassurance to Swiss National Bank officials who’ve lowered borrowing costs for two straight meetings, Bloomberg reported. Consumer prices rose 1.3% from a year ago in June, the statistics office said Thursday. That’s less than economists estimated and down from May’s 1.4%, which was the fastest clip this year. The slowdown was helped by a 0.2% annual decline in the cost of goods, while services were up 2.4%. Core inflation also moderated to 1.1%, defying expectations for it to quicken.
As Credit Suisse spiraled toward insolvency early last year, a group of Swiss bankers, technocrats and regional officials were already busy laying the groundwork for a new type of financial infrastructure, Bloomberg News reported. Nine months after the Swiss bank was rescued by crosstown rival UBS Group AG in March 2023, the Zurich and Basel cantons issued the first so-called tokenized bonds settled in Switzerland’s experimental digital currency. The Lugano city government followed suit shortly after.
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The Swiss National Bank lowered borrowing costs at a second straight meeting, keeping it at the forefront of global interest-rate cuts as it battles low inflation and a strengthening franc, Bloomberg News reported. Officials in Zurich reduced their benchmark by 25 basis points to 1.25% on Thursday after a decision that observers found hard to predict. Some investors bet on a cut, while a small majority of the economists surveyed by Bloomberg anticipated no change. Policymakers also lowered their inflation projections, seeing it at 1% in 2026.
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The merger of the Swiss units of UBS, opens new tab and Credit Suisse could be completed as early as July 1, a senior executive at UBS was quoted as saying on Tuesday, Reuters reported. UBS, which acquired former rival Credit Suisse last year after the bank's collapse, had previously indicated the two units would be combined during the third quarter.
Sabine Keller-Busse, president of UBS Switzerland, told the Neue Zuercher Zeitung newspaper in an interview that the plan was progressing "very well." "The merger could by done by July 1," she said.
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A group of investors in Credit Suisse Group AG bonds that got wiped out when UBS Group AG rescued the bank in a Swiss government-brokered deal are suing the European country in a U.S. court, Bloomberg News reported. The lawsuit, filed Thursday in federal court in New York, seeks more than $82 million plus interest and is the latest legal fight taking place in the US and Europe related to the bond write-down. Holders of Credit Suisse’s additional tier 1 bonds effectively saw about $17 billion of their notes written down to zero after the sale.
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Swiss financial regulator FINMA wants to be able to name and shame banks which breach its rules, Chief Executive Stefan Walter told newspaper NZZ in an interview published on Tuesday, Reuters reported. The call is one of FINMA's demands for increased powers after the authority came under fire over its handling of Credit Suisse's collapse last year. "Today, the publication of enforcement proceedings is the exception," Walter told the newspaper.
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Swiss inflation held at its fastest pace this year, eroding the case for a Swiss National Bank interest-rate cut when officials meet later this month, Bloomberg News reported. Consumer prices rose 1.4% in May from a year earlier, Switzerland’s statistics office said on Tuesday. That advance — which is in line with economists’ estimates — matches April’s reading. Rent, package holidays, fresh vegetables and petrol supported upward pressures, offset by heating oil, the statisticians said. Rent increases had been expected after previous central bank moves had raised a key reference rate.
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Switzerland’s approach to winding down a globally systemic bank such as UBS Group AG has features that could worsen the turmoil in a hypothetical future crisis, according to a key architect of global financial rules, Bloomberg reported. The country’s “Too-Big-to-Fail” regime is too focused on preserving local activities in the event of a break-up, said Paul Tucker, former Deputy Governor of the Bank of England and a current research fellow at the Harvard Kennedy School.
Attorneys for Sung Kook “Bill” Hwang are expected to argue that prosecutors are pushing a novel and nonsensical market manipulation theory when the criminal trial of the former Archegos Capital Management boss kicks off in New York this month, Reuters reported. Archegos, a $36 billion family office which invested Hwang's personal wealth, collapsed spectacularly in March 2021 after its highly leveraged bets on a small number of stocks via complex derivatives quickly soured.
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