The Swiss government recently tightened the rules on shareholders' equity – after tough negotiations with banking giants UBS and Credit Suisse (CS).

The discussion at times became heated and the Swiss Bankers Association was forced to intervene.

In Line With New Rules

Raiffeisen, usually not shy of flexing muscle in the capital Bern, remained largely silent. Now we know why: CEO Patrik Gisel's cooperative institute by the end of June already met the new rules according to the too-big-to-fail regulation of the banking law and shareholders' equity demands.

The risk-weighed capital ratio was 16.1 percent (as opposed to the required 14.4 percent) and the leverage ratio 6.7 percent (with a required 4.625 percent), according to the half-year result.

Way Ahead

Raiffeisen is way ahead of UBS and CS in that respect. According to estimates, they still require some 10 billion francs in shareholders' equity to meet the rules, which come into force in 2019. The new regulation admittedly puts the big banks under particular pressure.