Tough new capital rules set to be voted on by parliament later this year will benefit big Swiss banks, Switzerland's economy minister was quoted as saying on Sunday. Johann Schneider-Ammann said the standards - which would require UBS and Credit Suisse to hold an equity Tier 1 capital ratio of at least 10 percent, versus the 7 percent minimum set under Basel III - would make big banks safer and therefore more attractive.
"In the short-term, it's linked to higher costs and lower margins," he told Swiss paper SonntagsZeitung, in comments similar to those made in early March. "(But) I am convinced that client money will flow in rather than out."
Switzerland is at the forefront of a global push to increase oversight of the financial industry after bailing out UBS during the financial crisis. UBS and Credit Suisse together have balance sheets more than twice the size of the economy. The Swiss cabinet has proposed a draft law based on a report by a committee of experts, which included representatives of both UBS and Credit Suisse.
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