Zurich, April 11 (Reuters) – Switzerland’s main banking lobby said on Friday that the Swiss economy could face serious consequences. If UBS was overcome, warned of the risks of killing the bank with extreme rules.
The Switzerland is portraying strict banking rules to make the region more strong after 2023 collapse of Credit Suisse. UBS acquired its old rival, increasing anxiety about the possible risk for the economy.
UBS says it has no plans to leave, although people familiar with its thinking say that it is concerned that it can become an acquisition target if it has come back, and it has considered all scenarios, including to move its headquarters.
Credit Suisse Techover made UBS the only large international bank in Switzerland, and the regulator focuses on the amount of additional capital on the way to prevent another crisis.
UBS states that it is well capitalized and excessive capital requirements will be put into a loss for rivals, by reducing the competition of the Swiss financial sector.
The Swiss Bankers Association said last month that if the new rules were very high, it could encourage a UBS exit.
In a report to establish the benefits brought in the Swiss economy, the SBA stated that the country needed to maintain a competitive financial sector internationally – and addressed the cost of a potential UBS departure.
The SBA said, “Possible transfer of the remaining large bank … may have serious consequences in the moderate period.”
“A strategy that no longer focuses on global business activities, but can cause great harm to banking sector activities, mainly on regulatory and economic orientation towards the European Union, especially in other, other, in growing areas of the world, without any related benefits.”
SBA stated that the decline in the financial sector of Switzerland may stress economic production, jobs, public finance and limit access to capital for businesses.
The government of Switzerland is due to introducing its proposal for new capital regulations in early June. (Reporting by Dave Graham and Oliver Hurt; editing by Barbara Lewis)