Foreign Banks Seek Merger With UBS Over Swiss Capital Rules
UBS is considering mergers with foreign banks after the Swiss government approved tougher capital rules that could cost the institution $18 billion.
At least eight major foreign banks have expressed interest in a merger or combination with UBS following a decision by the Swiss upper house to implement stricter capital requirements. The bank estimates these new regulations could necessitate an additional $18 billion in capital.
In response to the regulatory pressure, UBS management has revived discussions on reducing its exposure to Swiss regulation. Chairman Colm Kelleher previously warned that the bank might rethink its Swiss base if the rules proved too harsh.
Swiss Finance Minister Karin Keller-Sutter disputed the likelihood of the bank relocating. She stated that a departure from Switzerland is unlikely because the legal complexities and associated costs would likely exceed the expense of meeting the new capital requirements.
