Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

UBS Plans Higher Fees to Push Rich Clients Out of Costly Cash

UBS Plans Higher Fees to Push Rich Clients Out of Costly Cash

UBS Group AG plans to increase charges for international wealth management clients located abroad and holding deposits in Switzerland, broadening its efforts to reduce costly cash holdings as negative interest rates persist.
Starting next year, the bank will charge wealth clients who don’t live in Switzerland 330 Swiss francs ($360) a month for holding cash deposits of 500,000 francs or less, according to a pricing list published on its website. Previously, the bank was charging clients about that amount for the year, a person familiar with the pricing details said.

At the end of June, depositors were given six months to decide whether to move a substantial amount of their holdings into investments or use other UBS services or face the increased charges, the person said, asking not to be identified as the matter is private.

UBS and global peers have seen their profitability hurt by half a decade of negative interest rates, which effectively make banks pay for holding clients’ cash. Many European lenders are pushing clients to use more investment products after a recession sparked by the coronavirus pandemic increases the probability that rates will stay low or negative for the foreseeable future.

Holding large amounts of cash in a negative interest rate environment is a value destructive strategy for both the client and banks, according to a UBS spokesman, who declined to comment on the new charges. The bank is discussing alternatives with some depositors who live abroad and hold large cash balances in Switzerland, he said.

Swiss blog Insideparadeplatz reported the fees earlier.

While the Swiss National Bank in March reduced the burden from negative rates on lenders, UBS has moved forward with cost-saving initiatives and increased lending to improve profitability. UBS’s policy of passing on negative rates to rich clients, which began last year, contributed to $16 billion in outflows during the first quarter.

To stem the outflows, the bank earlier this year started offering some of its wealthiest clients in Switzerland a payment holiday of several months if they plan to eventually invest some of their cash holdings, people familiar with the matter said earlier.

UBS has been sharing the cost of negative interest rates with clients who have more than 500,000 euros or 2 million francs in cash deposits. In April, the bank lowered the deposit threshold for charging clients in Germany to 500,000 euros from 1 million euros.

Credit Suisse Group AG has also shared the burden of negative interest rates with clients. It charges for deposits of more than 2 million francs and 1 million euros.
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

China’s Central Bank Consults European Peers on Low-Rate Strategies
0:00
0:00
Open
China’s Central Bank Consults European Peers on Low-Rate Strategies
0:00
0:00
Close
China’s Central Bank Consults European Peers on Low-Rate Strategies
France Requests Airlines to Cut Flights at Paris Airports Amid Planned Air Traffic Controller Strike
Poland Implements Border Checks Amid Growing Migration Tensions
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
Amazon Reaches Major Automation Milestone with Over One Million Robots
Extreme Heat Wave Sweeps Across Europe, Hitting Record Temperatures
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
Robots Compete in Football Tournament in China Amid Injuries
China Unveils Miniature Insect-Like Surveillance Drone
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Massive Anti-Government Protests Erupt in Belgrade
Iran Executes Alleged Israeli Spies and Arrests Hundreds Amid Post-War Crackdown
Hungary's Prime Minister Criticizes NATO's Role in Ukraine
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Hungarian Scientist to Conduct 30 Research Experiments on the International Space Station
NATO Members Agree to 5% Defense Spending Target by 2035
NATO Leaders Endorse Plan for Increased Defence Spending
U.S. Crude Oil Prices Drop Below $65 Amid Market Volatility
International Astronaut Team Launched to Space Station
Macron and Merz: Europe must arm itself in an unstable world
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Iran Intensifies Crackdown on Alleged Mossad Operatives After Sabotage Claims
Trump Praises Iran’s ‘Very Weak’ Response After U.S. Strikes and Presses Israel to Pursue Peace
Oil Prices Set to Surge After US Strikes Iran
BA and Singapore Airlines Cancel Dubai Flights Amid Middle East Tensions
Trump Faces Backlash from MAGA Base Over Iran Strikes
Meta Bets $14 B on Alexandr Wang to Drive AI Ambitions
FedEx Founder Fred Smith, ‘Heart and Soul’ of the Company, Dies at 80
Chinese Factories Shift Away from U.S. Amid Trump‑Era Tariffs
Pimco Seizes Opportunity in Japan’s Dislocated Bond Market
Labubu Doll Drives Pop Mart to Status as China’s Most Valuable Toy Maker
Global Coal Demand Defies Paris Accord Goals
United States Conducts Precision Strikes on Iran’s Nuclear Sites
US strikes Iran nuclear sites, Trump says
Telegram Founder: I Will Leave My Fortune to Over 100 of My Children
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
Hungary Ranked Among the World’s Safest Travel Destinations for 2025
G7 Leaders Fail to Reach Consensus on Key Global Issues
FBI and Senate Investigate Allegations of Chinese Plot to Influence the 2020 Election in Biden’s Favor Using Fake U.S. Driver’s Licenses
Trump Demands Iran's Unconditional Surrender Amid Escalating Conflict
×