Philipp Hildebrand: Lessons from the financial market turbulence
Summary of a speech by Mr Philipp Hildebrand, Vice-Chairman of the Governing Board of
the Swiss National Bank, at the Jefferies prize-giving ceremony, Zurich, 27 August 2008.
The complete speech can be found in German on the Swiss National Bank's website (www.snb.ch).
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The current financial crisis is probably the most complex since the 1930s. The extent of
international cooperation in overcoming it is greater than ever before. An important part in
these activities is being played by the Financial Stability Forum (FSF), which was founded in
1998 and to which Switzerland has belonged since 2007. Six months after the start of the
crisis, in April 2008, the FSF published a series of recommendations for enhancing the
resilience of the international financial system.
There are three main advantages to cooperating internationally in this way. First, it is easier
to focus more clearly on identifying solutions. Second, it ensures that particular attention is
paid to maintaining a level playing field when establishing regulatory measures. Third, it
creates considerable pressure for any recommendations issued to be implemented in
practice.
The current crisis has shown that the Swiss banking system remains vulnerable to major
shocks. As part of its statutory mandate to contribute to financial stability, the SNB has been
monitoring developments since the start of the crisis very carefully. The lessons learned by
the SNB from the crisis tie in with the recommendations of the FSF. For the SNB, the focus is
on measures that reinforce the long-term resilience of our financial system with a view to
future financial market crises.