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Swiss seek 5% leverage ratio for big banks: Bloomberg

[ZURICH] Switzerland's finance ministry will require the country's biggest banks to have capital equal to about 5 per cent of their total assets, the Bloomberg news agency reported on Tuesday, citing people briefed on the talks.

Switzerland has not made its final decision on the leverage ratio targets, a government spokesman said when asked about the report. "It's not yet decided," said Mario Tuor, head of communications for the State Secretariat for International Financial Matters. "It will be a government decision before the end of the year, that's all we can say." The report said the Swiss decision would copy the U.S. leverage ratio for its biggest banks.

Switzerland typically goes beyond the internationally agreed minimum capital requirements established by Basel III, but experts as well as the country's central bank have argued that the Swiss trail other nations in leverage ratio targets for banks.

The Swiss government said in February it would lay out tougher capital requirements for UBS and Credit Suisse , Switzerland's two biggest banks, by the end of the year.

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UBS and Credit Suisse reported BIS leverage ratios at the end of the second quarter of 3.6 per cent and 3.7 per cent respectively.

Solving the "too big to fail" problem has been a priority for regulators in the United States and Europe after several banks, including Zurich-based UBS, were bailed out in the financial crisis.

A spokesman for UBS declined to comment on the Bloomberg report. Credit Suisse was not immediately available for comment.