Swiss Lawmakers Delay Decision on US$20 Billion UBS Capital Rules

Swiss lawmakers have delayed a decision on tougher capital requirements for UBS after a parliamentary committee failed to reach agreement.

The panel will revisit the issue on 31 August, with an upper-house vote still targeted for September, Reuters reported.

The dispute centres on a government proposal requiring UBS to fully back its investments in foreign subsidiaries with Common Equity Tier 1 capital, or CET1.

The reforms were drawn up after the 2023 Credit Suisse crisis and are intended to strengthen safeguards for systemically important banks.

UBS estimates the foreign-subsidiary measure would require about US$20 billion in additional CET1 capital.

The bank has opposed the plan, arguing it would weaken its competitiveness and Switzerland’s standing as a financial centre.

Some lawmakers are considering changes that could reduce the burden, including allowing UBS to meet part of the requirement with Additional Tier 1 capital, or AT1.

Lawmakers have also explored strengthening AT1 by introducing a higher trigger for restrictions on investor payouts.

Featured image: Edited by Fintech News Switzerland, based on image by UBS

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