Tax could cost UBS up to 10 percent of Europe assets
ZURICH (Reuters) - UBS AG UBSN.VX could see up to 10 percent of its European assets of 300 billion Swiss francs ($312.52 billion) moved out due to pressure to clamp down on untaxed accounts, the head of the wealth management business was quoted as saying on Saturday.
"We have been losing assets in Europe for many quarters, around 10 billion francs to date," Juerg Zeltner told the Finanz und Wirtschaft newspaper in an interview.
"And we expect further asset outflows going forward, in the region of 12 to 30 billion francs. That's a bitter pill to swallow. We are able offset this erosion thanks to strong growth in new markets."
Zeltner said UBS had assets under management of over 300 billion francs in Europe, over 170 billion francs in Asia, around 110 billion francs in emerging markets and 130 billion in Switzerland.
"Banks that are focused largely on the European cross-border business are having a much tougher time," he said.
After mounting criticism of its tradition of strict bank secrecy, Switzerland has agreed to do more to help foreign governments hunt tax evaders and has signed deals with Germany, Britain and Austria to levy punitive taxes on undeclared assets held in its banks and a withholding tax on future client income.
Zeltner said he did not expect a mass exodus of clients once the deals come into force, in theory in 2013, although the German deal still faces some opposition from the Social Democrats.
"The lion's share of the German money leaving the bank will go to the tax authorities. There is no evidence of clients taking their money out of the country as they did in the U.S. case," he said.
UBS paid a big fine and handed over details of more than 4,000 clients to U.S. authorities in 2009 to settle allegations it helped wealthy Americans dodge taxes. Continued...