UBS and Switzerland: Striking a Balance in Banking Rule Debate

Switzerland and UBS are negotiating capital rules post-Credit Suisse collapse. UBS opposes the current proposal of $24 billion in additional capital, as it considers it too restrictive. A compromise might lower this to around $15 billion, though a legislative decision by parliament next year will be crucial.

Amid talks of reforming banking rules in Switzerland, UBS is eyeing a potential compromise with the government over stringent capital requirements following the Credit Suisse mishap. Confidential sources suggest that discussions hint at an adjustment down from the current $24 billion demand.

As the dialogue unfolds, insiders reveal that Bern might settle on a more palatable $15 billion requirement. However, no binding decisions have been reached, and the ultimate verdict lies with parliament, expected to deliberate in the coming year.

The heart of the debate surrounds UBS's overseas subsidiaries, with proposals to raise their capital ratios dramatically. Stakeholders remain hopeful that a balanced resolution promoting both stability and competitiveness will emerge.

(With inputs from agencies.)