Debt levels in the United States and Europe pose a risk to international financial stability and Switzerland, according to Swiss Finance Minister Karin Keller-Sutter. In an interview with the Swiss daily Blick, Keller-Sutter praised Switzerland’s “disciplined” financial management, which she said has helped the country navigate the economic challenges brought on by the COVID-19 pandemic and Russia’s invasion of Ukraine.
In contrast, Keller-Sutter pointed out that other countries are “so indebted they’re hardly able to act anymore,” citing France as an example. “Or take a look at America. That’s a time bomb,” she warned, referring to the stock market’s mini-crash at the start of August as a “warning shot” and an expression of investor fears of a potential recession. She emphasized that debt levels in the U.S. and Europe threaten global financial stability and Switzerland’s economic health.
Keller-Sutter also addressed a government proposal requiring Swiss bank UBS to hold more capital following its acquisition of the now-defunct Credit Suisse. She defended these additional capital requirements as essential to safeguard Switzerland from another banking crisis. UBS CEO Sergio Ermotti has criticized this proposal. When asked if she had been in contact with Ermotti about the matter, Keller-Sutter replied, “No, I haven’t been in contact with him anymore. This is now a normal political process.”
The interview also touched on speculation that UBS might relocate its headquarters abroad if it feels Swiss conditions are unfavorable. Keller-Sutter commented, “The Federal Council (cabinet) believes it’s good for the economy to have a large Swiss bank. But the bank must decide for itself how it wants to position itself.”