Credit Suisse Shows Well Capitalized Banks Can Lose Trust, Japan Official Says
- Market judged bank had weak business model, says Tomoko Amaya
- High capital levels aren’t enough to reassure market, she says
This article is for subscribers only.
Credit Suisse Group AG’s dramatic rescue is a lesson that even well-capitalized banks can lose the trust of the market, according to a senior Japanese regulatory official.
“Credit Suisse had such a high capital adequacy ratio and yet, the market gave up on it judging it had a weak business model,” Tomoko Amaya, the Financial Services Agency’s vice-minister for international affairs, said in an interview. It is “an important lesson” that having a lot of capital isn’t enough to reassure the market, she said.