Bank of America analysts have said Switzerland's forthcoming capital ordinance is likely to reduce UBS's regulatory burden significantly.
The Swiss Federal Council is anticipated to publish the ordinance on intangible capital on either 22 or 29 April 2026. According to Bank of America analysts, the ordinance may allow deferred tax assets classified as 'temporary differences' to count towards Common Equity Tier 1 (CET1) capital, subject to a 10% cap, an approach consistent with Basel III international standards. Under that scenario, the analysts estimate UBS's capital charge under the intangible capital rules would fall to USD 6.2 billion, down from a current estimate of USD 10.8 billion.
Foreign subsidiaries: a separate and larger question
According to Bloomberg, the April publication is expected to coincide with a second, potentially more consequential proposal: the capital treatment of UBS's foreign subsidiaries. Analysts anticipate the Swiss government will maintain its plan requiring full CET1 backing for foreign units, a requirement UBS has characterised as unacceptable. However, the analysts note the bill must pass through parliament, where they expect it to be modified to allow a portion of the requirement to be met with Additional Tier 1 (AT1) capital, which carries a lower cost than CET1.
Swiss lawmakers are scheduled to debate the foreign subsidiaries bill on 4 May 2026, according to the parliament's calendar. The full legislative process is not expected to conclude before the end of 2026.
UBS has updated its own impact assessment, indicating that the combined proposals, if enacted without modification, would impose approximately USD 22 billion in additional capital requirements relative to its position at the end of 2024. The bank has publicly opposed the reforms and has lobbied against them since they were proposed.
Relocation remains a distant scenario
Reports emerged in 2025 that UBS was examining whether to relocate its headquarters out of Switzerland should the capital reforms prove too restrictive. Bank of America analysts consider a headquarters move to be an option of last resort, suggesting the bank would more likely first explore asset disposals, potentially including its US-based operations.
Swiss authorities have signalled that the overall impact of the new rules would be manageable for the bank. In January 2026, it was reported that officials were preparing a draft law requiring full capital backing for UBS's foreign units whilst showing a willingness to soften the intangible capital component separately.
The Swiss capital reform debate reflects a broader post-crisis effort by regulators to ensure that systemically important institutions hold sufficient buffers, whilst banks and their investors press for rules that remain aligned with international norms to avoid competitive disadvantage.
UBS received the final approval to convert UBS Bank USA into a nationally chartered bank earlier in March 2026, completing a licensing process begun in October 2025. The approval confirmed UBS as the first Swiss bank to hold a national bank charter in the US. The OCC had granted conditional approval in January 2026, making final authorisation contingent on the bank meeting a set of regulatory requirements.
