Swiss Watchdog Says Lessons Must Be Drawn From Archegos Collapse

(Bloomberg) -- Switzerland’s top financial regulator said the collapse of Archegos Capital Management LP will have consequences for how banks deal with risk as one of the country’s biggest lenders counts its losses from exposure to the investment firm.

“The detailed lessons will doubtless be drawn, that has to be the case,” Mark Branson, the head of Swiss regulator Finma, said Wednesday, without referring to any banks by name.

He added that reserves of capital and liquidity that lenders have been obliged to build up since the financial crisis are “really important” given the volatility and “partial overheating” of markets.

Branson spoke to German lawmakers in Berlin as he prepares to take over leadership of the neighboring country’s financial watchdog BaFin.

His appointment is key to Germany’s efforts to restore confidence in its regulator after the Wirecard AG accounting scandal, yet Credit Suisse Group AG’s woes related to Archegos and Greensill Capital have cast a shadow over that overhaul.

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