UBS boss says some banks may need state help: Report
   
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UBS boss says some banks may need state help: Report

Last Updated: Sunday, September 11, 2011, 22:55
 
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UBS boss says some banks may need state help: Report

Zurich: Some banks may have to get help from the state as plunging share prices could make it difficult to raise capital, UBS (UBSN.VX) chief executive Oswald Gruebel told Swiss newspaper Sonntag in an interview published on Sunday.

Gruebel said his comment did not apply to the top two Swiss banks as Credit Suisse (CSGN.VX) and UBS were now less likely, compared with 2008, to be affected by European banks that found themselves in difficulty given that interbank trading was no longer as important.

Gruebel said future returns from investment banking were unlikely to be 20 percent and above but around 10 percent, adding this also applied to the big players on Wall Street.

UBS itself had to be rescued by the state in 2008 after massive losses on toxic assets.

Gruebel criticized the Swiss National Bank's recent move to set an exchange rate cap on the Swiss franc at 1.20 euros.

"We, as a small country with the franc, can't dictate an exchange rate against the euro. That is impossible in the long term. Despite this, I hope the effect that has been reached is sustainable," he said.

Separately, Credit Suisse chairman Urs Rohner, interviewed by NZZ am Sonntag, welcomed the SNB move to cap the franc.

"The franc was massively overvalued, as the actual purchasing power of the euro is estimated at about 1.35 francs to 1.40 francs," Rohner was quoted as saying.

Credit Suisse analysts expect the euro to rise to 1.25 francs in the next three months and to 1.30 francs in the next 12 months, Rohner said.

Bureau Report




First Published: Sunday, September 11, 2011, 22:55


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