ZURICH (Reuters) – Debt levels in the United States and Europe pose a risk to international financial stability and to Switzerland, Swiss Finance Minister Karin Keller-Sutter said in a newspaper interview published on Saturday.
In an interview with the Swiss daily Blick, Keller-Sutter praised Switzerland’s “disciplined” finances, which she said had enabled the country to deal with the economic challenges posed by the Covid-19 pandemic and Russia’s invasion of Ukraine.
In contrast, she said other countries were “so burdened with debt that they can no longer act”, giving France as an example.
“Look at America. It’s a time bomb. The mini-crash in the stock markets in early August was a warning shot,” the minister was quoted as saying.
“This was an expression of investors’ fear of recession. Debt levels in the United States and Europe pose a risk to international financial stability and a risk to Switzerland,” she added.
Keller-Sutter also discussed a government proposal to force Swiss bank UBS to hold more capital following its takeover of former rival Credit Suisse after its collapse last year.
She defended the additional capital requirements as necessary to protect Switzerland from another banking collapse.
UBS CEO Sergio Ermotti criticised the proposal, and when asked if she had been in contact with him about the matter, she said:
“No, I’m no longer in contact with him. This has become a normal political process now.”
The newspaper also asked her about speculation that UBS might move its headquarters abroad if it felt conditions in Switzerland were no longer suitable for it.
“The Federal Council (Cabinet) believes that a large Swiss bank is good for the economy. But the bank must decide for itself how it wants to position itself.”
UBS has repeatedly stressed its commitment to Switzerland.