SNB official warns against UBS client hunting

The vice-chairman of the Swiss National Bank has called on cantonal banks to avoid poaching customers from UBS, the country's largest bank.

In an interview with Sunday’s SonntagsBlick newspaper, Philipp Hildebrand said the banks, owned by Switzerland’s cantonal governments, should agree to an ethical code to benefit the country’s entire finance industry.

“It cannot be that the government and national bank help the financial centre of Switzerland with billions and the cantons do the opposite with their banks,” the central bank official said.

Cantonal banks, which fully insure deposits, have seen an inflow of billions of francs as clients flee UBS, which on October 16 received a bailout worth tens of billions from federal authorities.

UBS will receive a SFr6 billion ($5.18 billion) capital injection from the Swiss government in exchange for a 9.3 per cent stake and will dump $60 billion (69.56 billion) in illiquid assets into a fund controlled by the country’s central bank.

UBS announced its client advisors would receive salary raises averaging ten per cent in an attempt to keep them from quitting the embattled financial institution. It has also raised the interest paid on savings accounts.

UBS also confirmed on Sunday that its 12-member executive board would forego bonuses for the year, receiving only their salaries.