4. Hard Dealings in France
Meanwhile, UBS was maintaining a finely-tuned system to abide tax avoidance in France between 2004 and 2012. The French attorney general also accuses the bank of money-laundering and intends to follow this through in a court case later this year. Several top managers stand accused in the case, which UBS says is highly politicized. The bank denies wrong-doing. It therefore rejected a settlement and the payment of 1 billion euros in compensation.
The case is fraught with risks and has cemented the reputation of Swiss banking as having mainly profited from a system of helping rich people avoid paying taxes.
5. Helpless Despite a Grand Masterplan
In September 2007, the Swiss financial market launched a masterplan. The driving forces behind this bid warned banks and insurers that Switzerland as a financial market was falling behind its competitors. With the onset of the financial crisis a short while later, the grand plan was forgotten and the coordinated effort by Swiss finance actors was effectively a one-off with nothing much to follow. The expectations of Paradeplatz and those of officials in Bern diverged significantly.
The revival of the masterplan a few years later as well as the so-called asset management initiative didn’t last long and proved once again the inability of Swiss financial market players to act in unison. Quite to the opposite of, say, Luxembourg or Singapore.
6. Saving UBS – the Sin
Swiss taxpayers had to save UBS from going under during the global financial crisis in autumn of 2008. The aggressive growth strategy with U.S. subprime securities came back to haunt Switzerland’s largest bank, which had to write off about 50 billion francs.
UBS was shown to be extremely vulnerable and prone to strategic miscalculations, despite its Swiss origins and solidity. The government’s intervention drew headlines across the globe and impaired the image of Swiss banking further.
