Editors' note: This column is part of the Vox debate on "Lessons from Recent Stress in the Financial System"

Sunday, 19 March 2023 was a historic day for Swiss economic policy – and not in a positive sense. It was the day Swiss authorities announced a subsidised shotgun marriage between the two globally systemic Swiss banks. Credit Suisse had suffered a dramatic loss in confidence in its business model that triggered a spectacular bank run, which was ultimately resolved by a de facto takeover by UBS. This event is not only relevant for Switzerland but for the entire regulatory framework of global financial markets. It puts a huge question mark on whether global ‘too big to fail’ (TBTF) provisions for such cases will ever work as planned. Instead of a resolution according to the gone concern framework promoted internationally by the Financial Stability Board (FSB 2021), the Credit Suisse case was handled as if we were back in 2008. The government stepped in and used taxpayer money to avoid a potentially catastrophic breakdown of an obviously still ‘too big to fail’ institution. And all international observers applauded this swift action that clearly went against the provisions painstakingly designed, implemented, and internationally coordinated in the past decade....

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