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We frequently air obituaries of world leaders, celebrities and different folks on NPR. However immediately we convey you an obituary of a financial institution. Earlier this week, Credit score Suisse was bought by its Swiss rival, UBS, ending a 166-year custom of banking. NPR’s Rob Schmitz has this eulogy.

ROB SCHMITZ, BYLINE: On its internet web page, Credit score Suisse says it has been entrepreneurial from the beginning.

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UNIDENTIFIED PERSON: Entrepreneurs do not ask why. We ask, why not?

SCHMITZ: That’s apparently what politician and enterprise chief Alfred Escher requested in 1856, when the federal government of Switzerland approached him to assist finance the growth of the nationwide railroad. He requested, why not? And Credit score Suisse was born.

MARIO BABIC: And that basically led to a change of Switzerland into an industrial economic system and likewise opened it as much as commerce.

SCHMITZ: Mario Babic is editor of FIN Information and has lined Credit score Suisse from his perch in Zurich for years. He says Credit score Suisse’s historical past is enmeshed with Swiss historical past. The financial institution was lengthy thought-about a nationwide treasure with an incredible status, a pacesetter in European finance. However issues began to vary, says Babic, when the financial institution took a controlling stake in First Boston, an funding financial institution, in 1988.

BABIC: That is likely to be a little bit of a demarcation of kinds the place it went into the extra conventional American-style funding banking.

SCHMITZ: With that deal, says Babic, Credit score Suisse step by step strayed from its roots as a well-trusted financial institution specializing in wealth administration to a financial institution more and more centered on larger and riskier investments and income.

BABIC: It grew to become a way more worldwide financial institution that had gotten away from what folks may contemplate because the protected and boring kind of Swiss financial institution.

SCHMITZ: And as an alternative of protected and boring, Credit score Suisse grew to become a financial institution, as its promoting suggests, that as an alternative of evaluating danger and asking why…

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UNIDENTIFIED PERSON: We ask, why not?

SCHMITZ: Ten years in the past, Credit score Suisse requested why to not a deal in Mozambique to develop the fishing business, however a whole lot of tens of millions of {dollars} went lacking. The financial institution was accused of bribery. The IMF withdrew its assist, and it left a foreign money and debt disaster in one in every of Africa’s poorest international locations in its wake. In 2020, a former CEO of the financial institution resigned within the wake of a scandal the place the financial institution spied on a former head of wealth administration. Final yr, a former financial institution worker was sentenced to jail for serving to a Bulgarian cocaine trafficking cartel launder its cash. Since 2000, Credit score Suisse has been fined by regulators for a complete of $11.4 billion, practically 4 occasions what UBS paid to accumulate it.

JESSE GRIFFITHS: So it was a nasty financial institution or a financial institution that had had issues.

SCHMITZ: Jesse Griffiths is CEO of The Finance Innovation Lab.

GRIFFITHS: And it was that notion that led it to grow to be one of many first ones that individuals began worrying about when the arrogance in the entire system was shaken by the collapse of Silicon Valley Financial institution.

SCHMITZ: Griffiths says beneath regular circumstances, Credit score Suisse, regardless of its issues, would have survived.

GRIFFITHS: It is simply that when confidence drains from the system, any financial institution that isn’t very sound can grow to be a goal.

SCHMITZ: Griffiths blames a financial institution regulatory system that was weakened beneath President Trump, eliminating the necessity for financial institution stress checks and liquidity necessities. Wanting ahead, economist Tinatin Akhvlediani says higher regulation would assist enhance investor confidence, which in flip would save future banks from an identical demise.

TINATIN AKHVLEDIANI: So higher, stricter laws is actually, actually key, key consideration to the arrogance as a result of as soon as it is compromised, I believe it’s extremely, very troublesome to simply restore it. After which the crucial second comes, after which it is all simply blown away.

SCHMITZ: And for Credit score Suisse and so many different banks, that crucial second has arrived. Rob Schmitz, NPR Information, Berlin.

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