Finance
Swiss Social Democrats seek $40 billion in additional capital from UBS
Published by Global Banking & Finance Review®
Posted on March 3, 2025
2 min readLast updated: January 25, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on March 3, 2025
2 min readLast updated: January 25, 2026
Swiss Social Democrats propose UBS to increase its capital by $40 billion to enhance financial stability, facing opposition in parliament.
By Ariane Luthi
BERN (Reuters) - Switzerland's second-largest party in parliament on Monday presented a set of proposals to tighten regulation of UBS, including that the bank significantly ramp up the capital it holds.
The 49-page action plan by the Social Democrats (SP) argues UBS should hold $40 billion more capital, working from the basis that it had $78 billion in CET1 capital at the end of 2023.
Although the plan has little chance of meeting parliamentary approval, it adds to pressure from the left for tougher rules on Switzerland's last remaining systemically important global bank.
The SP argues that far-reaching measures are necessary to better protect Switzerland from the next banking crisis after the 2023 collapse of Credit Suisse, which UBS then acquired.
UBS, which has pushed back against higher capital demands, did not immediately reply to a request for comment.
The plan also foresees UBS paying for a state guarantee and creating an internal structure that separates business units more clearly from each other.
Other proposed measures include the establishment of an earnings pool at the Swiss National Bank, in which dividends and bonus payments above a certain threshold would be retained for several years and tapped in the event of a crisis.
The paper hinted that the plan will struggle to pass, stating: "If the banking lobby and the majority of parliament are not prepared to make such an arrangement, it must be admitted that UBS's risk for Switzerland is too great."
"In that case UBS would have to be broken up into smaller units, unless UBS relocates its headquarters on its own initiative," it added.
(Reporting by Ariane Luthi; Additional reporting by Oliver Hirt; Editing by Dave Graham)
The Swiss Social Democrats propose that UBS should hold an additional $40 billion in capital.
They argue that stricter measures are necessary to protect Switzerland from potential banking crises, especially after the collapse of Credit Suisse.
The plan includes UBS paying for a state guarantee and creating a clearer separation between its business units.
The plan is unlikely to gain parliamentary approval due to resistance from the banking lobby and the majority in parliament.
If UBS does not adhere to the regulations, it may face a breakup into smaller units or be forced to relocate its headquarters.
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