UBS Group and Credit Suisse will have to reduce profitable assets.

Switzerland imposed some the world’s strictest too-big-to-fail requirements in 2011 after the government came to UBS’s rescue during the 2008 financial crisis. UBS and Credit Suisse have assets of 1.83 trillion francs combined, about three times the size of the Swiss gross domestic product, making the two banking behemoths a disproportionately bigger danger to their country’s economy if they fail than their peers elsewhere. Both are compliant with all Swiss capital rules.

Switzerland’s finance ministry will require the country’s biggest banks to have capital equal to about 5 percent of total assets after UBS Group AG and Credit Suisse Group AG sought to win easier terms, according to people briefed on the deliberations.

Leverage ratios have gained favor among regulators as the most effective way to evaluate a bank’s robustness because the method doesn’t involve estimates of risks on their activities.

The decision would mimic the U.S. leverage ratio for its biggest banks, which exceeds the 3 percent minimum set in a global agreement by the Basel Committee on Banking Supervision, according to the people, who asked not to be identified because the talks aren’t public. The Swiss government will also align its calculation of the ratio with the method employed in the U.S., resulting in fewer types of debt counting toward capital, one of the people said.

Zurich-based UBS and Credit Suisse reported Basel III leverage ratios of 3.6 percent and 3.7 percent at the end of the second quarter, indicating they would be more than 1 percentage point short of the new target. This can be disturbed only long-term shareholders. In the ongoing growth of the financial sector as well as UBS (NYSE) - UBS Group AG, are possible short-term profits to the total down-trend from the beginning of August 2015 and the ongoing recovery in the last 14 days. Current UBS (NYSE) marks Change: + 1.88%, at 52W Range: 15.61 - 23.19.

G.Hristov / Head of Fundamental Analyzes