(Refiles to replace extraneous word ‘limit’ in headline with word ‘tax’)
By Joshua Franklin
ZURICH, Sept 30 (Reuters) - Switzerland’s government on Friday tasked its finance ministry with limiting the tax burden on UBS and Credit Suisse as the nation’s two biggest banks issue bonds to meet new too-big-to-fail (TBTF) requirements.
“The proposed solution would prevent the tax burden of the top holdings of systemically important banks from rising with the issuance of CoCos (Contingent Convertibles), write-off bonds and bail-in bonds,” the Swiss government said in a statement.
In May, the government settled on the final version of its TBTF law, which includes the headline requirement for a 5 percent leverage ratio of core capital to total assets at UBS and Credit Suisse.
Solving the TBTF problem has been a priority for U.S. and European regulators after several banks, including UBS, were bailed out by taxpayers during the financial crisis. (Reporting by Joshua Franklin, editing by John Miller)