ZURICH, March 19 (Reuters) - Much of the trust Switzerland gained from mastering the Credit Suisse crisis three years ago has been jeopardised by focusing too much on risks and fears in the ensuing
UBS CEO Warns of Risks in Swiss Bank Regulatory Debate After Credit Suisse Crisis
UBS Leadership Voices Concerns Over Swiss Banking Regulation
Loss of Trust Following Credit Suisse Crisis
ZURICH, March 19 (Reuters) - Much of the trust Switzerland gained from mastering the Credit Suisse crisis three years ago has been jeopardised by focusing too much on risks and fears in the ensuing regulatory debate, UBS CEO Sergio Ermotti said on Thursday.
UBS bought its fallen rival in a state-engineered emergency takeover in March 2023 and completed the migration of all former Credit Suisse clients worldwide to its own platforms this week.
Call for Balanced and Coordinated Regulation
Ermotti’s Opinion on Regulatory Measures
"Durable stability requires sound judgment, consistency, and international coordination - not measures that may provide short-term reassurance but ultimately undermine resilience and prosperity," Ermotti wrote in an opinion piece in Swiss newspaper Aargauer Zeitung.
"What is needed now is a sense of proportion and self-reflection, not fearmongering."
Upcoming Regulatory Decisions
Swiss Government’s Anticipated Proposals
The remarks come ahead of a regulatory showdown on capital rules for Switzerland's remaining big bank. The Swiss government is expected to publish its proposed banking regulation before the end of April.
Role of Loss-Absorbing Instruments
Importance of Additional Tier 1 (AT1) Capital
Ermotti specifically defended the validity of loss-absorbing instruments such as Additional Tier 1 (AT1) capital, which are set to play a key role in the upcoming regulatory debate in parliament.
Internationally, these instruments remain accepted as regulatory capital, and they played a key role in the stabilisation and restructuring of Credit Suisse, Ermotti said.
International Context and Comparisons
Other countries are reviewing their regulatory frameworks to ensure that rules are targeted, proportionate, and economically justified, he added.
Earlier this week, Reuters reported that the European Union plans to "neutralise" the impact on banks' capital requirements of a global banking reform package devised in the wake of the global financial crisis.
Reporting Credits
(Reporting by Ariane Luthi; Editing by Chizu Nomiyama )
