How a Banking Capital of the World Botched Its Own Banking Rules

Switzerland wanted its big banks to be fortresses. In practice, the country’s “too big to fail” banking laws made a sand castle of Credit Suisse.

The Swiss rules in question have become an object lesson in the difficulties of designing financial regulation. Created to prevent a repeat of the 2008 financial crisis bailouts, Switzerland’s customized version of international capital requirements laid the groundwork for the biggest bank rescue since.