Swiss government to submit plan that could force UBS to hold more capital, report says

FRANKFURT, March 15 (Reuters) - The Swiss government is set to submit a banking regulation package to parliament in April that could force UBS UBSG.S to hold more capital, SonntagsBlick newspaper reported on Sunday.

• The Federal Council plans to issue a so-called ordinance that would fully exclude certain balance sheet items from counting as capital, including software and deferred tax assets, the paper reported, without naming sources.

• That change is set to take effect on January 1, 2027, and could cost UBS 10 billion Swiss francs ($12.64 billion) after a transition period, the report said.

• The governing Federal Council plans to submit the measures alongside a draft law on stricter rules for UBS that would require its foreign subsidiaries be fully capitalized.

• The tighter rules follow the collapse of Credit Suisse, which UBS acquired in 2023 after a government-engineered emergency takeover.

• Reuters reported in December that the government was set to soften part of the banking regulation package.

• The bank said in its annual report last week that the proposed changes to Swiss capital rules would require it to hold additional so-called Common Equity Tier 1 (CET1) of around $22 ​billion, from ​previous guidance of $24 billion.

• Switzerland's finance ministry declined to comment on the report, but said that the Federal Council would adopt the revision in the first half of this year.

• UBS did not immediately respond to a request for comment.