Swiss propose liquidity rules costing banks little or nothing extra

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The headquarters of Swiss financial institution Credit score Suisse is seen beside a UBS department workplace on the Paradeplatz in Zurich, Switzerland, March 23, 2021. Image taken with a drone. REUTERS/Arnd Wiegmann

ZURICH, Sept 30 (Reuters) – Switzerland proposed up to date guidelines to make sure main banks maintain sufficient liquidity to soak up shocks, however the draft modifications will price banks little or nothing in extra capital and liquidity holdings, authorities paperwork confirmed on Thursday.

The proposed revisions, which had been despatched into session on Thursday, purpose to make sure that systemically vital banks (SIBs) — which embody Credit score Suisse and UBS — stay resilient beneath varied stress eventualities, together with in some circumstances not adequately coated by present guidelines, the federal government stated.

“Though the revised liquidity necessities for SIBs will introduce legally stricter liquidity necessities in comparison with the TBTF (too large to fail) regulation in drive at present, the authorities assume that this regulatory proposal can have little impression as a result of already excessive stage of liquidity,” the finance ministry stated in a report on Thursday.

Present estimates would “neither considerably improve nor scale back the general liquidity” held by systemically vital banks.

The had been additionally not anticipated to have a cloth impression on banks’ price of capital, the ministry stated.

Reporting by Brenna Hughes Neghaiwi; Modifying by Emelia Sithole-Matarise


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