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| Further losses at UBS, Credit Suisse possible: central banker |
| AFP/ PTI / Zurich Dec 11, 2008, 18:03 IST |
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Further losses at Switzerland's biggest banks UBS and Credit Suisse cannot be ruled out, a central banker warned today, adding that the authorities are keeping a close watch on the situation.
Philipp Hildebrand, the vice-chairman of the Swiss National Bank's governing board, said that several measures undertaken here, including an aid package worth almost $60 billion for UBS, have "had a positive effect" on the positions of the two banks.
The liquidity situation at UBS, in particular, has stabilised, he said.
"Nevertheless, further losses cannot be ruled out in view of the difficult market conditions," Hildebrand said.
"The situation remains serious, and the SNB will continue monitoring it closely together with the Swiss Federal Banking Commission and the Federal Department of Finance."
The two major Swiss banks have suffered massive losses in the financial crisis sparked by the collapse last year of the US subprime or higher risk home loan market.
UBS, which posted billions of dollars in asset writedowns, was forced to accept a state rescue package in a bid to restore client confidence and stem asset withdrawals which reached a colossal 83.7 billion Swiss francs ($70.2 billion) in the third quarter.
Credit Suisse, Switzerland's second biggest bank, has until now fared better than its peer UBS, with asset writedowns of about 12 billion Swiss francs.
But losses are beginning to pile up at the bank, with a warning of a 3.0 billion Swiss franc loss for the two months ending November following a 1.26 billion Swiss franc loss for the third quarter.
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