Report: Swiss regulator says more UBS aid possible

The head of the Swiss Banking Commission said he did not rule out that UBS AG might need more government aid to survive the financial crisis, a daily newspaper reported Sunday.

Daniel Zuberbuehler told SonntagsZeitung that a $60 billion government bailout agreed last month with UBS had stabilized the bank's liquidity situation.

But "if you look at the development of the market, it is indeed open whether our package of measures will be sufficient," he was quoted as saying.

UBS is Switzerland's largest bank, and if it faces more difficulties, the government "might have to inject more capital," he reportedly said.

Of last month's $60 billion bailout, about $5 billion will be used to bolster the bank's reserves and $54 billion to help it dispose of high-risk securities. Profits from the sale of these assets will be shared between the Swiss National Bank and UBS.

UBS spokesman Dominique Gerster declined to comment Sunday, but said UBS was in regular contact with the banking commission.

Zuberbuehler said it was unlikely another bank would take over UBS, as a buyer would have to acquire the entire bailout deal, including illiquid UBS shares held by the Swiss National Bank.

He ruled out a merger between UBS and Credit Suisse Group because, he said, the risks of such a big operation were too high under current market conditions.

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