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Senate agrees tougher banking rules

The government has won initial approval from parliament for its plans to bolster capital standards to protect the wider economy from future financial crises.

The Senate on Monday agreed a proposal which forces the main banks to build up a total capital ratio of at least 19 per cent – above the minimum set by international regulators.

Supporters, notably from the centre-left but also from other parties, said a repeat of the 2008 UBS bailout must not happen again.

Opponents, however, argued the proposed rules were too strict and would damage the competitive edge of Swiss banks on the global market.

The other parliamentary chamber, the House of Representatives, will discuss the bill at a later stage.

The government hopes the amended law will come into effect next year.

The combined value of assets at the two main banks, UBS and Credit Suisse, is currently 3.8 times higher than Switzerland’s Gross Domestic Product.

swissinfo.ch and agencies


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