Swiss propose liquidity rules that cost banks little or nothing more than imposing monetary policies

Swiss propose liquidity rules that cost banks little or nothing more than imposing monetary policies ...

ZURICH, September 30, Switzerland proposed updated rules to ensure that major banks have enough liquidity to absorb shocks, but the draft modifications will cost banks little or no additional capital and liquidity holdings according to government records on Thursday.

The proposed revisions, which were sent into consultation on Thursday, aim to ensure that systemically important banks (SIBs) -- which include Credit Suisse (CSGN.S) and UBS (UBSG. S)are resilient under various stress circumstances, including in some cases not adequately covered by current rules, according to the government.

"While the revised liquidity requirements for SIBs will introduce legally stricter liquidity standards compared to the TBTF (too large to fail) regulation in force today, the authorities believe that this regulatory proposal will have little impact owing to already high level of liquidity," the finance ministry said in a statement on Thursday.

According to current estimates, the proposal would "neither significantly increase or reduce the overall liquidity" held by systemically important banks.

According to the ministry, the proposed modifications were not expected to have a significant impact on the bank's capital cost.

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