A popular initiative in Switzerland wants to hold a vote on partially nationalizing UBS Group AG, the initiators wrote on their website.
(Bloomberg) — A popular initiative in Switzerland wants to hold a vote on partially nationalizing UBS Group AG, the initiators wrote on their website.
The so-called banks initiative proposes to amend the Swiss constitution to say that “large banks of systemic importance are to be managed as joint stock companies with the confederation as majority shareholder in terms of share capital,” according to the website.
The text is currently under review by federal authorities. If they greenlight it, the initiators have 18 months to collect 100,000 signatures for their cause. Parliament and cabinet ministers would then need to weigh in before the issue could be put to a national vote, a process that would likely take several years.
Popular initiatives are a key part of Switzerland’s system of direct democracy. Even if they don’t succeed, they often influence public debate.
After the government-brokered takeover of its former rival Credit Suisse, UBS’s assets are now about twice the size of the Swiss economy. This has raised concerns that the bank would be too big to rescue.
UBS “is a cluster risk for our economy,” Bernhard Schmidt, the 58-year-old school headmaster from near Zurich who’s leading the initiative, told weekly paper Sonntagszeitung. “In the next crisis, the whole country could go under.”
So far, the initiative committee is solely composed of Schmidt’s friends and family, the paper quoted him as saying, but he hopes that supporters and donors will join his cause.
A spokeswoman for UBS declined to comment.
(Updates throughout with initiative website)
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