UBS Weighs Relocation as Switzerland Proposes $18 Billion Capital Hike
UBS Group is considering moving its headquarters abroad to avoid proposed Swiss capital requirements that could cost the bank $18 billion.
CEO Sergio Ermotti indicated that UBS Group is weighing its ability to compete while based in Switzerland as the government moves to impose tougher capital requirements. The proposed rules, developed after the 2023 collapse of Credit Suisse, could require the bank to secure approximately $18 billion in additional Common Equity Tier 1 capital.
An internal assessment by the Swiss government examined the feasibility of UBS relocating its headquarters to avoid these costs. The analysis found that moving to the United States would involve expensive restructuring due to clean-holding and double-leverage restrictions, potentially matching the cost of the Swiss capital hit. A move to the United Kingdom would offer softer rules for foreign subsidiaries but would necessitate higher capital for the bank's remaining Swiss operations.
The Swiss Finance Ministry maintains that the proposed measures are manageable for the institution. However, UBS has warned that the rules could damage its global competitiveness. An employee group cautioned that a departure could put up to 12,000 jobs in Switzerland at risk, particularly impacting Zurich where banks are the largest corporate taxpayers.
