Lawmakers renew efforts to split up UBS, C Suisse

Chisel Split Ice

Parliamentarians from Switzerland's right-wing Swiss People's Party (SVP) are mounting a new effort to split up UBS and Credit Suisse by teaming with left-wing lawmakers.

Reuters reports that Lower-house lawmakers on Monday submitted three motions aimed at separating investment banking activities from so-called systemically relevant activities, even after Switzerland put stiffer regulation into force last year for the country's two largest banks.

'A bank should only as big that it can be allowed to fail in an emergency, without the state intervening', SVP lawmaker Caspar Baader said in parliament.

'We need smaller banks as a result, and thus more of them'.

In the meantime, The Financial Times reports that Credit Suisse is thought likely to do some more restructuring over at its investment bank.

Although the firm has carried out a general refocusing of its investment banking activities so that most of its capital is now used in areas where it has a strong market position, there's probably more work to do.

'They remain weak in rates. They don’t seem to have the scale to compete with the big players, and that is something they need to address', says Chris Wheeler, an analyst at Mediobanca.

'In the second quarter, rates revenues represented just 13% of fixed income trading revenues and the return on Basel III capital was the lowest of any of Credit Suisse’s investment banking businesses'.

Swiss lawmakers renew efforts to split UBS, Credit Suisse

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