SNB says UBS, Credit Suisse likely need 10 bln Sfr in new capital

The Swiss National Bank (SNB) said on Thursday the country's two biggest banks, UBS and Credit Suisse, will likely each need to raise an extra 10 billion Swiss francs ($10.4 billion) in capital to meet new leverage requirements.

"The big banks could cover the bulk of this capital requirement by issuing high-trigger CoCos (contingent convertible bonds), as both of them already almost meet the 3.5 percent CET1 capital requirement," the central bank wrote in its annual financial stability report.

Last month, Switzerland's government settled on the final version of new too-big-to-fail (TBTF) bank rules, which included a headline requirement for a 5 percent leverage ratio of core capital to total assets for UBS and Credit Suisse. At least 3.5 percent is to be made up of high-quality common equity tier 1 (CET1).