Swiss National Bank considers "fragile" situation of UBS and Credit Suisse

 The Swiss National Bank (SNB) held today in its latest financial stability report that the situation of the two largest banks, UBS and Credit Suisse, remains "fragile" despite the "significant growth" of their allocations to funds own.

This increase in allocations has been particularly notable in the case of UBS, which declined in 2009 to 7 per cent exposure to equity markets, one of the main risks facing the Swiss bank, according to the monetary institution Switzerland.

By contrast, Credit Suisse rose 17 per cent exposure to equity markets last year.

The BNS highlights both entities decreased in 2009 to 20 percent of its total lending, although they improved their quality.

Regarding the first quarter of 2010, the Swiss central bank considers that the "uncertainties are still present," which for the two largest banks translates into an increased risk.

Therefore, the SNB said that the new capital requirements required of the large Swiss banks are "necessary", while admitting that they are "elevated."

The prospect of profitability for the sector remains limited by as much as, according to the monetary institution, even despite the fact that UBS has returned to profitability in its latest quarterly results.

The Swiss central bank stressed that UBS and Credit Suisse have indirect exposure to Portugal, Italy, Greece, Spain and Ireland 60 300 million Swiss francs (43.416 million euros)