Banks Jordan: Leading international financial center comes with risks
The outgoing President of the Swiss National Bank, Thomas Jordan, has spoken out in favor of a leading international financial centre in the future. To this end, the risk of systemically important, globally active banks must also be accepted, said Jordan.
The Swiss National Bank (SNB) does not guarantee any institution, Jordan said in an interview with the "Neue Zürcher Zeitung" on Saturday. However, framework conditions should be created "that allow an entrepreneurial bank to operate internationally from here", said the SNB President.
The challenge now is to define an overall package of corrections for the big bank UBS that reduces the risks and allows the big bank to operate successfully from Switzerland. Improvements in resolvability and adjustments on the capital side are needed. The National Bank supports the measures proposed by the Federal Council.
Independent monetary policy
According to Jordan, the hurdle for a fundamental system change - such as the SNB taking over banking supervision - must be high. He once again underlined the importance of an independent SNB: "If the SNB were responsible for banking supervision, this would increase the risk of politicization and a loss of independence, which could have a negative impact on monetary policy in the longer term."
The recent past in particular, with comparatively low inflation in Switzerland, has shown how "valuable an independent monetary policy is", said the SNB Chairman. With its focus on price stability, the SNB also has the backing of policymakers so that they can fulfill their tasks.
Unconventional means
Jordan is stepping down at the end of September. He has headed the SNB since 2012 and worked for the National Bank for over 27 years. "There has never been another period in history in which the SNB was forced to pursue monetary policy using unconventional means for so long," he said, looking back.
His successor will be the current SNB Vice-Chairman Martin Schlegel. Schlegel said after his appointment at the end of June that he wanted to continue to ensure stability.
SDA
