ZURICH (Reuters) – Banks regarded as too big to fail are sufficiently capitalized, UBS Chairman Colm Kelleher said on Thursday, as his bank seeks to avoid regulations currently taking shape in Switzerland that could hurt business.
“My personal opinion – and I would say this, wouldn’t I – is that since 2008, the too big to fail banks are more than adequately capitalized,” Kelleher said at an event in Brussels. “That is yesterday’s battle.”
Kelleher was speaking a day after UBS presented better than expected third quarter results that initially cheered the stock market before the mood soured due to uncertainty about when the new Swiss regulations would become clear.
In April, the Swiss government set out proposals intended to prevent a repeat of a banking collapse like the 2023 demise of Credit Suisse, which led to the lender’s takeover by UBS.
Those plans envisaged making UBS hold additional capital, though the bank has pushed back, warning that unduly onerous requirements could hamper business and hurt Switzerland.
Kelleher said regulators were looking backwards on capital and needed to encourage banks to boost the economy.
“We should be focusing on other things such as liquidity provision. I think that’s what Credit Suisse taught us. That it wasn’t anything to do with capital, it was to do with business model and liquidity pro forma,” he said.
“We’re fighting yesterday’s battle by over-regulating banks and bank capital. We’re forcing products to leave the banking system to go elsewhere.”
(Reporting by Dave Graham and Oliver Hirt; Editing by Miranda Murray and Mark Potter)
