Former Swiss Finance Minister Raises Concerns Over UBS’s Size
Ueli Maurer warns that UBS’s expansion poses risks to Switzerland’s economy
UBS, Credit Suisse, Switzerland, Ueli Maurer, Finance
ZURICH: So, Ueli Maurer, the former Swiss finance minister, is sounding the alarm about UBS. He thinks the bank is just too big for Switzerland after its takeover of Credit Suisse. He mentioned that we need to find ways to lower the risks that come with such a massive bank.
He pointed out that when you look at the numbers, UBS’s balance sheet is around $1.7 trillion, which is double what Switzerland makes in a year. That’s a lot of weight for one bank to carry in a major economy.
And if UBS were to fail, there wouldn’t be any local banks left to pick up the pieces. Plus, nationalizing it could really hurt public finances, which is a scary thought. Maurer stressed that shareholders need to step up and take responsibility, not just leave it to taxpayers.
He also mentioned that the government is looking into tougher capital requirements for UBS and other big banks to make the financial sector stronger after the Credit Suisse mess. But there’s pushback from UBS about holding onto an extra $15 billion to $25 billion in capital.
Maurer warned that if those requirements are too steep, Swiss banks might consider moving elsewhere. He believes having a large bank is beneficial for the Swiss economy, especially with all the international companies here, but we need to keep risks in check.
UBS hasn’t commented yet, but it’s clear that this situation is still unfolding.
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