UBS boss warns of extreme banking regulation forward of reform

ZURICH (Reuters) – Switzerland shouldn’t impose guidelines on its banking sector that will put it at an obstacle, UBS CEO Sergio Ermotti mentioned on Monday, because the nation prepares to overtake laws following the takeover of Credit score Suisse by his financial institution.

Swiss authorities are anticipated to suggest more durable banking guidelines within the coming weeks geared toward avoiding a repeat of the 2023 collapse of Credit score Suisse, which left UBS the nation’s solely international financial institution.

UBS is cautious of what might emerge and Ermotti mentioned tighter regulation throughout the board might weaken the Swiss monetary sector within the face of competitors from London, Hong Kong and Singapore.

“Switzerland can’t afford to fall again into the ‘mannequin scholar syndrome’ and introduce guidelines that don’t apply in different international locations,” Ermotti informed Migros-Magazin, the weekly from one of many main Swiss retailers.

Echoing the findings of a Swiss parliamentary investigation launched in December, Ermotti mentioned Credit score Suisse had induced its personal demise and that Swiss authorities had allowed the financial institution to avoid laws already in place.

Large banks have discovered classes from previous crises and at the moment are a stabilizing issue, not the issue, he argued.

“Even when UBS had an issue, it will be not possible that the taxpayer would lose a franc,” Ermotti mentioned, asserting that his financial institution had sufficient reserves to cowl potential losses.

Ermotti mentioned the combination of Credit score Suisse into UBS was going easily, describing the chance of delays in a fancy IT migration as the most important problem.

On the fragile topic of remuneration, Ermotti mentioned he at all times felt he ought to be paid primarily based on his rivals and primarily based on his efficiency, including that his very first month-to-month wage as an apprentice was 350 Swiss francs ($388).

The CEO earned 14.4 million francs ($15.96 million) in 2023.

($1 = 0.9020 Swiss franc)

(Reporting by Ariane Luthi; modifying by Sharon Singleton)