Swiss lawmakers are expected to submit a softened banking reform proposal that could lower capital requirements for UBS's foreign subsidiaries. The government's original proposal called for UBS to hold 100% Common Equity Tier 1 (CET1) capital for these subsidiaries, while the new proposal considers allowing a reduction to 50% CET1, with the remaining difference to be filled by Additional Tier 1 (AT1) bonds. UBS had previously stated that overly strict capital rules would weaken its global competitiveness. The proposal is expected to be debated in the upper house in September, with final rules likely not to be introduced before the end of this year.