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Investing.com -- UBS Group AG (NYSE:UBS) is contemplating a potential relocation of its headquarters if Switzerland continues to insist on the bank holding an additional $25 billion in capital, according to Bloomberg sources familiar with the matter. The bank’s internal calculations show that its key capital ratio could increase to approximately 20% in the most severe scenario from the current 14%. Executives believe that staying in Switzerland would render the group noncompetitive compared to global rivals.
Swiss government and regulatory bodies are advocating for UBS, the nation’s largest bank, to fully deduct the value of its foreign subsidiaries from the parent bank’s capital. This move is seen as a necessary measure to prevent a recurrence of the 2023 collapse of Credit Suisse. While Switzerland aims to evade the financial ruin that could result from UBS’s potential failure, the bank perceives this plan as an excessive reaction after it stepped in to save its former competitor two years ago.
UBS regards the proposal as so detrimental that it would have no other option but to relocate its headquarters, revealed one source.
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