The amendment to the Banking Act and the Capital Adequacy Ordinance submitted by the Federal Council for consultation on September 26, 2025, stipulates that systemically important banks must in future fully back their holdings in foreign subsidiaries with equity capital.
Although VAV members are not directly affected by the proposal, the association has issued a statement due to the far-reaching nature of the proposal. It considers the complete deduction of foreign holdings in the parent company of systemically important banks from core capital (CET 1) to be disproportionate and counterproductive. Such a regulation would also weaken the international competitiveness of the only institution affected, UBS, and thus have a negative impact on the diversity and performance of the entire Swiss financial center.
