ZURICH (Reuters) – Debt levels in the United States and Europe are a risk to international financial stability and for Switzerland, Swiss Finance Minister Karin Keller-Sutter said in a newspaper interview published on Saturday.
In an interview with Swiss daily newspaper Blick, Keller-Sutter praised Switzerland's “disciplined” finances, saying they had enabled the country to cope with the economic challenges brought about by the coronavirus pandemic and Russia's aggression in Ukraine.
In contrast, other countries “have so much debt that they can barely take action anymore,” she said, citing France as an example.
“Or look at America. America is a time bomb. The mini-crash in the stock market in early August was a warning shot,” the minister was quoted as saying.
“This is a sign of investor concerns about an economic downturn. Debt levels in the United States and Europe are a risk to international financial stability and also a risk for Switzerland,” she added.
Keller Sutter also discussed government proposals to require Swiss bank UBS to hold more capital following its takeover of former rival Credit Suisse after its collapse last year.
She defended the extra capital requirements as necessary to protect Switzerland from new bank failures.
UBS CEO Sergio Ermotti has criticised the proposal, and when asked if she had contacted him about the matter, she replied:
“No, I'm no longer in contact with him. This is now the normal political process.”
The paper also asked what he thought about speculation that UBS might move its headquarters abroad if it felt the situation in Switzerland was no longer suitable.
“The Bundestag (government) believes that having large Swiss banks is good for the economy. But the banks have to decide for themselves what position they want to take.”
UBS has repeatedly stated that it is committed to Switzerland.
