Swiss Banks May Shrink on Higher Leverage, JPMorgan Says
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UBS AG and Credit Suisse Group AG, Switzerland’s biggest banks, may have to shrink their fixed-income, currencies and commodities activities if the nation’s regulator imposes higher leverage ratios than currently planned, according to JPMorgan Chase & Co. analysts.
Credit Suisse in particular would be hit by rules forcing banks to hold more capital in relation to their assets, analysts led by Kian Abouhossein wrote in a note to clients today. While both firms are estimated to reach Swiss leverage ratios of at least 4.2 percent by 2015, a Finance Ministry proposal that the measure be raised to 6 percent would lead to “material uncertainty” and possible cuts in FICC, they wrote.