UBS intends to keep chief executive Sergio Ermotti beyond his planned departure in 2027 as the Swiss lender confronts a regulatory battle with Bern that could force it to hold up to $24 billion in additional capital.

Swiss newspaper Neue Zuercher Zeitung reported on Saturday that the board, led by chairman Colm Kelleher, wants Ermotti to remain in post beyond April 2027 to steer the bank through negotiations over tougher capital requirements following the 2023 collapse of Credit Suisse. Two people familiar with the matter previously told Reuters that Ermotti had been expected to step down by mid-2027, although no final date had been set.

A UBS spokesperson told Reuters: “As we have repeatedly said, Sergio P. Ermotti will remain Group CEO until at least early 2027,” adding that it was “premature to speculate about the timing of Sergio stepping down”.

The dispute centres on proposals unveiled by the Swiss government in June aimed at preventing future banking crises after UBS’s emergency takeover of Credit Suisse. Under the plans, UBS could be required to hold as much as $24bn in additional capital and fully back foreign subsidiaries with common equity tier one capital rather than the current 60 per cent requirement.

According to Neue Zuercher Zeitung, Switzerland’s Federal Department of Finance has proposed that UBS should no longer count software and deferred tax assets towards its core capital, a change the bank calculates would erase around SFr11bn at a stroke. The newspaper reported that uncertainty over the final capital regime has complicated succession planning, as the board cannot yet define the bank’s strategic direction.

UBS has rejected the proposed tightening, arguing it would weaken Switzerland’s competitiveness as a financial centre and place the bank at a disadvantage internationally. In a statement, the spokesperson said: “We will do everything we can to ensure that UBS can continue to operate successfully as a global bank from Switzerland. Nevertheless, the Board of Directors is obliged to prepare for all scenarios.”

Ermotti, 65, returned as chief executive in 2023 to oversee the integration of Credit Suisse, having previously led UBS from 2011 to 2020. The final migration of former Credit Suisse clients is due by the end of the first quarter, with the shutdown of legacy systems expected by the end of 2026.

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