Swiss Central Bank Ranks PostFinance Systemically Important

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The Swiss National Bank classified state-owned PostFinance AG as a systemically important lender, adding the company to a list of the country’s largest banks that includes UBS Group AG and Credit Suisse Group AG.

The decision was taken after consultation with PostFinance and the Financial Market Supervisory Authority, the SNB said in a statement on its website on Tuesday. Other banks that have been named too-big-to-fail are Raiffeisen Schweiz, UBS, Credit Suisse and Zuercher Kantonalbank.

“The reasons given were the financial institution’s significant status in domestic deposit services and its strong position in payment transactions in Switzerland,” PostFinance said in a statement.

PostFinance will seek to implement “the specific requirements regarding equity, liquidity, risk concentration and the development of contingency plans,” it said in the statement. The company calls itself market leader in payment transactions.

The firm has a capital ratio, a measure of financial strength, of 20.1 percent, above the minimum requirement for systemically relevant banks of 14 percent, Chief Executive Officer Hansruedi Koeng said on a conference call. The lender will discuss emergency plans to prepare for a crisis, he said.

Switzerland was forced to bail out UBS during the financial crisis, prompting regulators to increase scrutiny to avoid a repeat. The government is currently drafting tougher capital rules for the country’s banks, in order to keep capital requirements among the world’s strictest.

Of the country’s systemically relevant banks, only UBS and Credit Suisse are publicly traded. ZKB and PostFinance are state-owned, while Raiffeisen is controlled by its customers.

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