UBS Chairman Colm Kelleher said on Wednesday that the Swiss bank was “not too big to fail” as he criticized the US bank. Strengthen the capital requirements of government consultancy.
Kelleher was speaking at UBS’s annual shareholder meeting, the first such gathering since the bank’s founding. Complete acquisition Former rival Credit Suisse acquired the company last summer.
“UBS is not big enough to fail. UBS is one of the best capitalized banks in Europe, with a sustainable business model and a correspondingly low-risk balance sheet,” said Kelleher.
He added that the bank was “gravely concerned” about current discussions on additional capital requirements, which he believed would limit Switzerland’s competitiveness as a financial center and increase regulatory fragmentation in Europe.
Kelleher gave the example of Credit Suisse, which collapsed in March 2023 after years of scandals and risk management failures showing that “there is no regulatory solution to a broken business model”.
“It wasn’t low capital requirements that forced Credit Suisse’s historic weekend rescue,” Kelleher said at the annual shareholder meeting.
He noted that since the 2007-08 financial crisis, capital requirements for “systemically important banks around the world” had become more stringent and said that the world’s ability to effectively absorb losses was now about 20 times stronger, with UBS’s capital requirement exceeding $2,000 million. gone .
Earlier this month the Swiss government enacted a proposed range designed to protect the wider economy from potential instability at UBS and the other three major banks.
While it did not specify what impact such tough capital requirements would have, the Swiss government said they should be “targetedly stricter” and singled out UBS for “significant” growth.
The proposals target banks deemed “too big to fail” – a term that has grown in use since the financial crisis to describe institutions that are systemically important to the national economy and governments cannot allow them to fail. This de facto state aid has been widely criticized for encouraging risk-taking and mismanagement.
