Swiss lawmakers are debating a proposal that would require UBS to hold approximately $20 billion in additional capital to cover its foreign subsidiaries. Parliament is considering requiring 70-80% CET1 backing instead of the full 100%, as UBS already holds a buffer of $13 billion above the proposed requirements. The Swiss National Bank is not sounding alarm bells about UBS’s current financial health. CEO Sergio Ermotti warns that overregulation could put UBS at a structural disadvantage compared to competitors in London, New York, or Frankfurt. UBS shares have surged to multi-year highs as markets price in the likelihood of a regulatory compromise.
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