ZURICH, June 15 Switzerland's two biggest banks,
UBS and Credit Suisse, are on track to meet
the country's updated too-big-to-fail rules but more progress is
needed in preparing plans for a potential insolvency, the Swiss
central bank said on Thursday.
"In particular, by end-2019, the big banks will need to
demonstrate that they would be able to maintain their
systemically important functions in Switzerland in the event of
impending insolvency," the Swiss National Bank (SNB) wrote in
its annual financial stability report.
Switzerland has already settled on its too-big-to-fail
rules, which included a headline requirement for UBS and Credit
Suisse to hold core capital worth 5 percent of total assets. At
least 3.5 percent of the leverage ratio is to be made up of
high-quality common equity tier 1 (CET1) capital.
The rules are designed to protect Switzerland's economy from
a banking crisis.
(Reporting by Joshua Franklin)