Swiss Bank Stays Put as Capital Rules Tighten

Last week the upper house of Switzerland's parliament approved stricter capital rules for big banks. The new rule means UBS might need to set aside roughly eighteen billion dollars extra. Lawmakers chose a plan that asks the bank to cover its foreign operations with ninety percent core equity.

UBS had hoped for a different mix. It wanted half core equity and half extra tier one instruments, which are cheaper to hold. The parliament rejected that idea and went with the stricter version.

Finance minister Karin Keller‑Sutter said moving the bank out of Switzerland would cost more than meeting the new rules. She also noted that such a shift would involve legal headaches. In her view, staying put makes more sense for UBS.

Earlier the government had already given the bank some concessions. UBS dismissed those offers in recent comments. Keller‑Sutter added that the bank probably thought it would win the vote, but the outcome surprised it.