UBS Chair Criticizes Swiss Capital Requirement Plans

UBS Chairman Colm Kelleher has expressed concerns that the Swiss government's proposed increase in capital requirements for major banks could undermine Switzerland's status as a financial center. While he supports most of the recommendations in the government’s 'too-big-to-fail' report, he opposes the stricter capital requirements, arguing they could harm competitiveness and lead to unfavorable pricing for banking products. Finance Minister Karin Keller-Sutter has suggested that UBS may need an additional $15 billion to $25 billion, but analysts estimate a lower requirement of $10 billion to $15 billion. Kelleher emphasized the need to focus on liquidity management and bank resolvability instead. As competition from financial hubs like Luxembourg and Singapore increases, Kelleher's remarks highlight the delicate balance between regulatory measures and maintaining attractiveness for international investors. UBS’s significant balance sheet, which is double that of Switzerland’s annual economic output, poses potential risks if the bank were to fail.