And, as the SEC and the ABA Cox it up still further on the voodoo accounting front, back in the home of the free, Switzerland is taking a very different approach; it's called honesty.
Credit Suisse, the second largest Swiss bank, reported a net third quarter loss of $1.3 billion after further writedowns, and said it had raised $8.8 billion from “a small group of major global investors” including the Qatari authorities, which already hold a significant stake.
Simultaneously, the Swiss National Bank said it had set up a fund to absorb toxic assets from the country’s biggest bank, UBS, and has shoved mandatory convertible notes worth some $5.3 billion into the bank itself, giving it around a 9% stake in the company.
The Fund is capitalized with $6 billion of equity capital provided by UBS and $54 billion from the Swiss National Bank.
Of course, the Cox approach would be to pretend that the UBS $60 billion in toxic assets now transferred into the Swiss National Bank's fund weren't really very toxic at all, and that if the accountants had done their duty and pretended, sorry, reported that they were just fine there wouldn't be a problem.
Which brings us back to those nice investors who have ponied up $8.8 billion for Credit Suisse; investors don't do that for banks they don't trust. And the Swiss banking authorities have shown they can be trusted not to play silly games of voodoo accountancy whilst the world's financial markets burn...