Credit Suisse and SVB: Where were the regulators and who governs them?

Here we go again! Banks are starting to pop left and right, and in the US and Switzerland – countries that should have learned from the 2007-08 Global Financial Crisis (GFC) and know better.

This raises a fundamental question: who governs the regulators so that they learn and retain their lessons from previous crises, and apply them with determination to avoid a repeat scenario? It’s not simply about changing the rules but also asserting themselves where necessary.

The 2007-08 crisis already was the result of a sequence of relaxing constraints on the US banking system. It started with the relaxation by the SEC of the net capital rule, allowing investment banks to greatly increase their level of…