A parliamentary committee has already offered UBS $7bn off its $20bn capital add-on

If Additional Tier 1 bonds can cover half of the foreign subsidiary requirement, and that alone takes the demand from roughly $20bn to an estimated $13bn ^[3][6][7], then the foreign subsidiary piece is about $14bn of the total on its own ^[18], and something else in the rules accounts for the remaining $6bn ^[19]. The inference holds only if the substitution runs one for one and touches nothing but the foreign subsidiary component, which is how cryptobriefing.com describes the committee's proposal ^[6].

The chamber is therefore voting on the last 35% of the demand ^[20]. The committee moved before anyone voted, and on its numbers UBS is raising $13bn either way ^[7]. The government's text required 100% CET1 backing of foreign subsidiaries ^[5]. Ermotti called that overly harsh, and argued Switzerland would be setting standards significantly stricter than other major financial centres, putting UBS at a disadvantage against Wall Street and European rivals ^[9].

What the compromise buys is a coupon instead of equity. AT1 pays interest and can be written down or converted to equity if the bank hits trouble ^[11]. UBS can use it because the market came back. European AT1 seized up briefly when Credit Suisse's holders were wiped out in the 2023 rescue and has since stabilized, so the bank could likely issue without paying punitive rates ^[12]. Had that market stayed shut, the concession would have been worth considerably less than $7bn ^[8].

Kelleher has gone further than his chief executive, warning that UBS may reconsider its future in Switzerland entirely if the requirements undermine competitiveness ^[13]. Ermotti's version was narrower: the cost would not sit with shareholders alone, and customers and employees would feel it too ^[4]. The account does not name a jurisdiction UBS would move to or put a figure on moving ^[21]. Swiss lawmakers want something specific, which is a UBS able to absorb losses from its foreign subsidiaries without the taxpayer being pulled in ^[17]. The same account reports that regulatory uncertainty has prompted a reconsideration of Ermotti's expected departure timeline ^[16].

If the compromise passes, UBS keeps more flexibility on a bill that stays expensive ^[15]. If the chamber holds at full CET1 backing, the bank either issues new equity that dilutes existing holders or redirects profit away from distributions and into buffers for years ^[14]. The third possibility is that the domicile warning was the price of the $7bn, and nothing about where UBS is registered changes. I'd weight that one, because the concession arrived before the vote and $13bn is not a figure UBS has said it cannot meet. A named jurisdiction with a costed plan would change my view. So would a strict vote followed within months by an equity raise. The gap on its own is large enough to move return on equity, dividend capacity and buyback programmes ^[10].