UBS has reduced its share of the Swiss mortgage market. The Swiss bank want to grow in other areas instead.
Switzerland’s largest bank has pared its exposure to the real estate business in its home market as the business is displaying signs of overheating – a trend that the central bank repeatedly has warned about. UBS nevertheless wants to grow in Switzerland as Axel Lehmann, the head of the Swiss business unit, told «Sonntagszeitung» (behind paywall).
UBS may in future sell products that would protect clients from losing their homes due to a variety of reasons. One such option may be to take out a life insurance that would help the family stay in their home after the death of the breadwinner.
Cautious Approach to Remain
Lehmann didn’t say how far the plans had been developed for selling insurance products in Switzerland. The top banker however has spent a significant part of his career in the insurance business.
Switzerland’s No.1 will remain a cautious actor in the Swiss mortgage market. The bank has reduced the credit volume in investment properties – mainly residential blocks – by a quarter over the past year.
Lehmann said that the bank didn’t extend some mortgages because of signs that the market was overheating. The home owners generally found new lenders among Raiffeisen and cantonal banks.
