Finance

China calls for peaceful coexistence with the U.S. despite differences

Published

3 months ago

March 7, 2025

Chinese Minister of Foreign Affairs Wang Yi speaks during the 2023 Munich Security Conference in Germany on February 18, 2023.

Johannes Simon | Getty Images News | Getty Images

BEIJING — China’s Minister of Foreign Affairs Wang Yi struck a more conciliatory tone on U.S. relations during a high-profile press conference on Friday, in contrast to the ministry’s more aggressive language earlier in the week.

While Wang said the U.S. should not impose “arbitrary tariffs” or return goodwill with hostility, he emphasized that the two countries would both be part of the world for a long time, requiring “peaceful coexistence.”

“Given the extensive common interests and broad space for cooperation, it is fully possible for China and the U.S. to become partners helping each other succeed,” Wang said in Mandarin, via an official translation.

He spent much of the roughly 90-minute press conference talking about China’s efforts to improve relations with other countries and supporting the interests of non-Western nations.

Wang is also director of the office for foreign affairs within the Communist Party of China’s central commission, making him the country’s most senior diplomat. He was speaking to reporters during China’s annual parliamentary meeting, known as the “Two Sessions.”

His comments came shortly after China hit back against U.S. President Donald Trump’s mounting trade tariffs.

“If war is what the U.S. wants, be it a tariff war, a trade war or any other type of war, we’re ready to fight till the end,” the Chinese Embassy in the U.S. said in a post Wednesday on X.

Tensions between the U.S. and China have escalated in the last several days. Trump earlier this week imposed yet another 10% of tariffs on Chinese goods, to which Beijing retaliated with targeted duties on U.S. agricultural products and restrictions on several U.S. companies.

Chinese Minister of Commerce Wang Wentao indicated to reporters Thursday that Beijing was willing to meet with the U.S. for talks on trade.

In a proposed budget released this week for government spending this year, Beijing plans to increase spending on diplomatic endeavors by 8.4% versus a 6.6% increase last year.

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Published

1 day ago

June 6, 2025

Business Finance News

Finance

Swiss government proposes tough new capital rules in major blow to UBS

Published

2 days ago

June 6, 2025

Business Finance News

A sign in German that reads “part of the UBS group” in Basel on May 5, 2025.

Fabrice Coffrini | AFP | Getty Images

The Swiss government on Friday proposed strict new capital rules that would require banking giant UBS to hold an additional $26 billion in core capital, following its 2023 takeover of stricken rival Credit Suisse.

The measures would also mean that UBS will need to fully capitalize its foreign units and carry out fewer share buybacks.

“The rise in the going-concern requirement needs to be met with up to USD 26 billion of CET1 capital, to allow the AT1 bond holdings to be reduced by around USD 8 billion,” the government said in a Friday statement, referring to UBS’ holding of Additional Tier 1 (AT1) bonds.

The Swiss National Bank said it supported the measures from the government as they will “significantly strengthen” UBS’ resilience.

“As well as reducing the likelihood of a large systemically important bank such as UBS getting into financial distress, this measure also increases a bank’s room for manoeuvre to stabilise itself in a crisis through its own efforts. This makes it less likely that UBS has to be bailed out by the government in the event of a crisis,” SNB said in a Friday statement.

‘Too big to fail’

UBS has been battling the specter of tighter capital rules since acquiring the country’s second-largest bank at a cut-price following years of strategic errors, mismanagement and scandals at Credit Suisse.

The shock demise of the banking giant also brought Swiss financial regulator FINMA under fire for its perceived scarce supervision of the bank and the ultimate timing of its intervention.

Swiss regulators argue that UBS must have stronger capital requirements to safeguard the national economy and financial system, given the bank’s balance topped $1.7 trillion in 2023, roughly double the projected Swiss economic output of last year. UBS insists it is not “too big to fail” and that the additional capital requirements — set to drain its cash liquidity — will impact the bank’s competitiveness.

At the heart of the standoff are pressing concerns over UBS’ ability to buffer any prospective losses at its foreign units, where it has, until now, had the duty to back 60% of capital with capital at the parent bank.

Higher capital requirements can whittle down a bank’s balance sheet and credit supply by bolstering a lender’s funding costs and choking off their willingness to lend — as well as waning their appetite for risk. For shareholders, of note will be the potential impact on discretionary funds available for distribution, including dividends, share buybacks and bonus payments.

“While winding down Credit Suisse’s legacy businesses should free up capital and reduce costs for UBS, much of these gains could be absorbed by stricter regulatory demands,” Johann Scholtz, senior equity analyst at Morningstar, said in a note preceding the FINMA announcement.

“Such measures may place UBS’s capital requirements well above those faced by rivals in the United States, putting pressure on returns and reducing prospects for narrowing its long-term valuation gap. Even its long-standing premium rating relative to the European banking sector has recently evaporated.”