The Swiss Financial Market Supervisory Authority (FINMA) has quietly joined the growing parade of western nations who have quietly re-written banking laws to allow depositor bail-ins upon the next banking crisis.
If Switzerland, the once ultimate safe haven for banking deposits across the world is preparing to confiscate depositors funds, there truly is no protection anywhere other than physical gold and silver in your own possession!
In the event that a bank is failing or where its capitalization is no longer adequate, the Swiss Financial MarketSupervisory Authority (“FINMA”) may take measures to improve such bank’s financial viability rather thanliquidating it. “Loss absorption” and “bail-in” are important instruments to support any such measures.
The Swiss document begins by advising that the FINMA now has legal authority to confiscate depositor funds, thanks to a revision of the Banking Act of 1934, completed in 2011, as well as the revision of the Bank Insolvency Ordinance completed Nov 1st 2012:
In the event that a bank is failing or where its capitalization is no longer adequate, the Swiss Financial Market
Supervisory Authority (“FINMA”) may take measures to improve such bank’s financial viability rather than
liquidating it. “Loss absorption” and “bail-in” are important instruments to support any such measures. This
is now possible as a result of a revision of the Banking Act of 8 November 1934 (the “Banking Act”) in 2011 and
the taking effect of a revised Bank Insolvency Ordinance on 1 November 2012 (the “Bank Insolvency Ordinance”)
and of a revised Capital Adequacy Ordinance on 1 January 2013 (the “Capital Adequacy Ordinance”).
The document states that The Banking Act now grants discretion to FINMA regarding depositor bail-in measures:
RELEVANT PROCEEDINGS
Under the Banking Act, if there are concerns that a bank is
over-indebted or if a bank does not meet liquidity or regulatory
capital requirements, the FINMA may as appropriate:
(i) take protective measures; (ii) initiate bank reorganization
proceedings; or (iii) order the liquidation of the bank
(bankruptcy). The Banking Act grants significant discretion
to FINMA in this context. This includes, inter alia, ordering
a bank moratorium, a maturity postponement or “bail-in”
measures.
And in the scope of bail-in measures, states that bail-ins are to be a measure of last resort (translation: we’ll make this sound unlikely until the banks lose their first franc):
BAIL-IN MEASURES
4.1 Scope
The loss absorption measures described above relate to
capital instruments issued by the bank. In addition, the
revised procedural rules as specified in the secondary legislation
to the Banking Act applicable in a bank reorganization
context (i.e. if FINMA believes that the bank may be successfully
reorganized or if at least part of the business of the failing
bank may be continued), as enacted by FINMA, provide
for the competence of FINMA to convert or write-off other
debt (even in the absence of any contractual provision to that
effect in the arrangement governing such debt) if and to the
extent necessary to allow the bank to meet its regulatory
capital requirements after completion of the reorganization
(“bail-in”).
Such bail-in is designed to be available as a
measure of “last resort” to be taken in the event that the
loss absorption under the capital instruments issued by the
bank is not sufficient to restore the required capitalization of
the failing bank and if the creditors are likely to be better off
than in an immediate insolvency of the bank.
The bail-in must be specified in the reorganization plan,
which must be approved by FINMA and – except for banks
of systemic importance – also by a majority of non-privileged
creditors (calculated on the basis of the claim
amounts). If such approval cannot be obtained, the bank
would be liquidated in bankruptcy proceedings.
In the event that FINMA only applies protective measures,
but does not consider any reorganization measures as necessary
or adequate, a bail-in could not occur as one of such
protective measures.
Still under the delusion that the DIESELBOOM Cyprus Template cannot happen here?
GOT PHYZZ???
http://silverdoctors.com/boes-carneys-dieselboom-policy-makers-working-diligently-to-devise-an-international-bail-in-regime/
BOE’S CARNEY’S DIESELBOOM: POLICY-MAKERS WORKING DILIGENTLY TO DEVISE AN INTERNATIONAL “BAIL-IN” REGIME
APRIL 18, 2013 BY
THE DOC
Outgoing Bank of Canada Governor (& Goldman alum and incoming BOE Governor) Mark Carney just released an epic Freudian slip today during a televised speech in Washington regarding the Western financial system’s co-ordinated move from bailouts to bail-ins as official policy to future bank crises.
It’s one thing when the editor of an obscure financial blog discovers bail-in language written into policy by the Fed, Bank of England, the Bank of Canada, Italy, & New Zealand and it goes viral throughout the alternate financial blogosphere, and it is another thing entirely when the incoming head of the Bank of England himself accidentally lets slip that Western financialpolicy-makers are working diligently to devise an international “bail-in” regime to prevent big bank failures.
Mark Carney’s DIESELBOOMesq retraction in 3…2…1….
Mark Carney says policy-makers are working diligently to devise an international “bail-in” regime to prevent big bank failures, but he offered no guarantee that individual deposits would be protected.
The Canadian central banker, who is a few months away from heading the Bank of England, says banks must have a set of buffers in place to draw on in an emergency.
No worries however according to Carney, as it is “hard to fathom” why it would be necessary to dip into depositors accounts, while at the same time refusing to rule out the confiscation of accounts under deposit insurance limits:
Carney did not answer whether there should be a total hands-off treatment to non-secured accounts as well, which in Canada would mean deposits over $100,000.
Still, Carney says Canadians should not lose any sleep over the safety of their deposits.
He says Canadian institutions have sufficient capital and other buffers in place making it hard to fathom why it would be necessary to dip into deposits.
We are fairly certain that 2 months ago it would have been hard for Cypriots to fathom that their deposits would be confiscated by the ECB/IMF.
http://countdowntozerotime.org/2013/04/19/fdic-bank-of-england-create-resolution-authority-for-unlimited-cyprus-style-bail-ins-for-tbtf-banks/
Switzerland To Buy A Stunning 1,000 Tons Of Physical Gold?
I would also like to point out two very important developments taking place in Switzerland. A movement inside Switzerland has already acquired 100,000 signatures for two things to be put on the ballot. The first one would eliminate any future sales by theSwiss National Bank. But the second, and far more compelling measure, would be for Switzerland to buy back 1,000 tons of gold that it has already sold. To get 1,000 tons of physical gold in this market is going to be a Herculean task, and it is certainly going to vault the price of gold much higher than current levels. This will be a very interesting situation to watch unfold in the physical gold market.”FULL INTERVIEW
The goal is to produce resolution strategies that could be implemented for the failure of one or more of the largest financial institutions with extensive activities in our respective jurisdictions. These resolution strategies should maintain systemically important operations and contain threats to financial stability. They should also assign losses to shareholders and unsecured creditors in the group, thereby avoiding the need for a bailout by taxpayers.The joint US/UK resolution states that depositor haircuts are already legal in the UK thanks to the 2009 UK Banking Act:
In the U.K., the strategy has been developed on the basis of the powers provided by the U.K. Banking Act 2009 and in anticipation of the further powers that will be provided by the European Union Recovery and Resolution Directive and the domestic reforms that implement the recommendations of the U.K.
Independent Commission on Banking.
Such a strategy would involve the bail-in (write-down or conversion) of creditors at the top of the group in order to restore the whole group to solvency.
And that the legal authority has already been given in the US buried in Dodd-Frank:
Farage – People Are Lined Up Around The Block To Buy Gold
We are now incredibly cynical about our government, about our central banks, about all of the things that we are told. They are sure signs, if people are queued up around the block to buy physical gold, that people are scared..“They don’t believe what they are told. Exactly when the moment is I don’t know, but all I would say to people who have been building into a gold position over the course of the last few years, and doing it for all of the right reasons that King World News has advocated, don’t panic. Don’t worry. This is a buying opportunity, not the moment to panic.”.One of two things will emerge from this because in the end if people lose confidence, they give up on their established political parties and they seek alternatives.And it’s a theme that I’ve used before, but perhaps it’s even more salient today than it’s ever been, I just hope that we are able to find, particularly across Europe where the problem is the most acute, political alternatives that people start to vote for that conform to sensible democratic norms.The alternative of course is that we do get a new kind of fascism that sweeps Europe. I become more worried with every month that goes by that perhaps they (fascists) are the alternatives people will seek . It is very, very worrying.”
FULL INTERVIEW
.
http://www.forbes.com/sites/afontevecchia/2011/11/04/the-worlds-29-most-systemically-important-banks/
The 29 Global Banks That Are Too Big To Fail
Among the several commitments that came out of the recent G20 summit held in Cannes, the Financial Stability Board (FSB) has released a list of 29 systemically important banks that will have to raise their core tier 1 capital ratios above Basel III mandates. The list includes eight U.S. banks and seventeen European banks, along with three Japanese institutions and one from China. (
Click on the slideshow for the complete list of the 29 most important banks).
The FSB is also pushing for banks to increase their internal supervisory measures and for governments to safeguard taxpayers when bailing out institutions deemed too big to fail, while figuring out how to resolve cross-border issues.
* * *
29 TBTF Banks globally - if you have money in TBTF Banks in the US or Europe , you are on notice !
Here,
as determined by a G20 cabal known as the Financial Stability Board, are the members of the fancily titled-cased Globally Systemically Important Financial Institutions club.
From theAtlantic:
Bank of America (US)
Bank of New York Mellon (US)
Citigroup (US)
Goldman Sachs (US)
J.P. Morgan (US)
Morgan Stanley (US)
State Street (US)
Wells Fargo (US)
BNP Paribas SA (France)
Banque Populaire (France)
Crédit Agricole SA (France)
Société Générale SA (France)
Barclays PLC (UK)
HSBC Holdings PLC (UK)
Lloyds Banking Group PLC (UK)
Royal Bank of Scotland PLC (UK)
Mitsubishi UFJ FG (Japan)
Mizuho FG (Japan)
Sumitomo Mitsui FG (Japan)
Commerzbank AG (Germany)
Deutsche Bank AG (Germany)
UBS AG (Switzerland)
Credit Suisse AG (Switzerland)
Dexia SA (Belgium)
Bank of China (China)
Unicredit Group SA (Italy)
ING Groep NV (Netherlands)
Banco Santander SA (Spain)
Nordea AB (Sweden)
Submitted by Tyler Durden on 04/19/2013 15:50 -0400
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