Lagarde: EU Banks Have Limited Exposure to Credit Suisse

The transcript discusses the limited exposure to Credit Swiss, particularly in relation to the 81s, and the decision by Swiss authorities under Swiss law. It highlights that Switzerland does not set standards for the EU, which are determined by EU regulations and directives. The resolution framework in the EU, established after the financial crisis, dictates the order of loss absorption, with common equity instruments first, followed by additional tier one instruments. This approach is consistently applied in crisis interventions.

What is the extent of exposure to Credit Swiss as mentioned in the video?

• Millions

• Billions

• Trillions

• Thousands

Who sets the standards for the European Union?

• World Bank

• Swiss Authorities

• European Parliament

• United Nations

What is the first type of instrument to absorb losses in a troubled bank according to the EU framework?

• Preferred Shares

• Corporate Bonds

• Common Equity Instruments

• Additional Tier One Instruments

What is the role of the Single Resolution Board in the EU?

• To guide crisis intervention actions

• To manage global financial stability

• To set Swiss banking standards

• To regulate non-EU banks

Which organization recommended the reforms implemented in the EU resolution framework?

• European Central Bank

• World Trade Organization

• Financial Stability Board

• International Monetary Fund