UBS Chairman Colm Kelleher has issued a strong warning that proposed Swiss capital requirements pose a significant threat to the bank’s business model and financial stability, raising questions about its long-term future within Switzerland. The Swiss government is seeking to introduce these stringent new banking rules following the 2023 collapse of Credit Suisse, which UBS — Switzerland’s sole remaining global bank offering a comprehensive range of financial services including wealth management, investment banking, and asset management — acquired in a state-engineered emergency takeover. Kelleher told shareholders at UBS’s annual general meeting in Basel that the proposals, which could compel the bank to carry an additional $22 billion in capital, have already generated considerable pressure from markets and investors.
Despite the looming regulatory challenge, Kelleher affirmed UBS’s desire to remain headquartered in Switzerland, stating, “We are as much an integral part of Switzerland as our Swiss heritage is part of us.” However, he explicitly ruled out shrinking the bank’s size and underscored its ambitious growth strategies in Asia and the United States. Kelleher stressed that “key business decisions may soon become unavoidable” if these “extreme proposals” are confirmed. UBS CEO Sergio Ermotti echoed this resolve, vowing to “fight until the last minute” to defend the bank’s position as Switzerland enters a decisive phase in reshaping its regulatory framework. The extent of UBS’s share buybacks, Kelleher added, remains contingent on the final regulatory regime.
In contrast to UBS’s stance, the Ethos Foundation, a prominent proxy advisor representing various pension funds and investors, expressed support for stricter capital requirements. Ethos Foundation CEO Vincent Kaufmann argued, “We must not allow a system where executives are rewarded while the risk is borne by the financial system and taxpayers.” During the meeting, several speakers also criticised UBS’s sustainability performance, with a small group of protesters rallying outside against fossil fuel financing. Kelleher acknowledged that stakeholders expect UBS to actively support the transition to a low-carbon economy. Meanwhile, Kelleher was re-elected chairman with 88.16% of votes, and new board members were confirmed.
