Banks push back on Basel capital proposals

Big banks in the United States and Switzerland used public appearances this week to argue that new capital rules would force them to hold more money against risk and could reshape parts of their businesses. (bankingdive.com) (ubs.com) At JPMorgan Chase’s first-quarter 2026 earnings call on April 14, Chief Executive Jamie Dimon and Chief Financial Officer Jeremy Barnum said revised Basel Three and global systemically important bank proposals still overlap. JPMorgan estimated the changes would add about $20 billion of required capital, or roughly 4%. (bankingdive.com) (jpmorganchase.com) Dimon had already previewed that stance in his 2025 annual letter, released in April 2026, writing that parts of the latest Basel Three and surcharge drafts were “still very flawed” and that some elements were “frankly nonsensical.” (bankingdive.com) (jpmorganchase.com) In plain terms, capital rules tell banks how much shareholder-funded cushion they must keep to absorb losses before depositors and creditors are hit. The global systemically important bank surcharge adds an extra layer for the biggest cross-border lenders, with higher requirements tied to a score based on size, interconnectedness and other indicators. (bis.org 1) (bis.org 2) The Basel Committee is also revisiting how that surcharge is measured because it said some banks appear to reduce certain balance-sheet indicators at year-end to lower their scores. A 2023 consultation proposed using average values over the year instead of a single year-end snapshot. (bis.org 1) (bis.org 2) In Switzerland, UBS Chairman Colm Kelleher told shareholders at the bank’s annual general meeting on April 15 that the country’s regulatory debate will shape both UBS and the Swiss financial center. He said some proposed capital measures could make “key business decisions” unavoidable if they are adopted in full. (ubs.com 1) (ubs.com 2) That Swiss fight traces back to the March 2023 rescue of Credit Suisse by UBS and the government’s follow-up review of “too big to fail” rules. In September 2025, the Federal Council opened a consultation that would require systemically important Swiss banks to fully back foreign subsidiaries with parent-bank capital over a transition period of at least six to eight years. (admin.ch) (news.admin.ch) Swiss authorities have defended the plan. The Federal Council, the Swiss National Bank and the Swiss Financial Market Supervisory Authority said the measure is necessary, targeted and manageable for UBS, while FINMA said higher capital requirements are key to making large banks more resilient in a crisis. (news.admin.ch) (finma.ch) JPMorgan is making a narrower argument in the United States: not that higher capital should disappear, but that the same risks should not be counted twice across Basel Three, the stress capital buffer and the global systemically important bank surcharge. Barnum said last month that Basel Three endgame by itself probably would not change requirements much either way relative to current rules, but the surcharge remains a major open issue. (jpmorganchase.com) (bankingdive.com) The next step in both debates is with regulators, not bank chiefs. Basel officials are still refining the surcharge framework, and Swiss authorities are still working through post-Credit Suisse changes that UBS says could force choices about how it is structured and where it puts capital. (bis.org) (admin.ch)