Foreign banks signal interest in UBS merger, Swiss paper says

Key facts

• At least eight foreign banks have signaled interest in a merger or combination with UBS.
• UBS estimates new Swiss capital rules could require it to hold $18 billion in additional capital.
• UBS Chairman Colm Kelleher warned the bank might reconsider its Swiss base if capital rules were too harsh.
• Switzerland's finance minister said UBS leaving its Swiss base is unlikely and would be expensive and legally complicated.

Several major foreign banks have expressed interest in a potential merger or combination with Switzerland's UBS, according to a report by Swiss newspaper Blick. Citing an insider, the report stated that at least eight banks have signaled their interest to UBS.

This news follows a vote by Switzerland's upper house on Wednesday in favor of tougher capital rules for the bank. UBS estimates these new regulations could require it to hold approximately $18 billion in additional capital. Ahead of the vote, UBS Chairman Colm Kelleher had warned that the bank might reconsider its Swiss base if the capital rules were deemed too harsh.

Earlier on Friday, Semafor reported that UBS management had revived discussions about reducing its exposure to Swiss regulation, including through a potential combination with a foreign bank. However, Switzerland's finance minister, Karin Keller-Sutter, stated over the weekend that it was unlikely UBS would leave its Swiss base, as it would be more expensive and legally complicated than adhering to the new capital rules.