This is a very smart move by the Swiss government. It's ridiculous that other countries have been too afraid to force local banks to do the same. Heaven forbid the banks are asked to buffer their failures from taxpayers. Heaven forbid politicians stand up to the bank lobbyists.
Global Swiss banks UBS and Credit Suisse must hold capital well in excess of new international standards, a government commission said, to limit risk that a bank failure could drag down the economy.
The new rules may crimp the two banks' ability to compete in the field of investment banking, but Swiss regulators want them to focus more on less risky private banking.
The report from the commission of top regulators, bank executives and other industry representatives published on Monday said the two banks should hold at least 10 percent of risk-weighted assets based on new global standards (Basel III) in form of common equity.
