The Swiss Council of States voted 29-16 to mandate that UBS maintain a 90% Common Equity Tier 1 (CET1) capital backing for its foreign subsidiaries. Goldman Sachs and Citigroup analysts estimate this requirement will force the bank to raise approximately $17 billion in additional capital.
UBS internal projections suggest a slightly higher impact, estimating $16 billion from the parliamentary measure plus an additional $2 billion from upcoming ordinance changes. The bank has criticized the decision as excessive, noting it could weaken its competitive standing against global peers.
The regulatory move follows the 2023 collapse of Credit Suisse and subsequent government-led rescue. If finalized, the cumulative CET1 capital requirements for UBS could exceed $30 billion. The original government proposal had initially sought $20 billion in additional capital.
The legislation requires approval from the National Council, the lower house of the Swiss parliament, and may face further amendments or a referendum that could delay implementation until 2027. UBS intends to advocate against the current terms during the next legislative stages.
Analysts warn that the capital requirement may limit the bank's ability to issue dividends or conduct share buybacks. The final impact on shareholder returns will depend on whether the 90% threshold is maintained or adjusted during the remaining legislative process.
