Swiss should slow up on new financial rules-banker

* Other financial centres have not implemented new rules

* Swiss should not rush new liquidity rules, C.Suisse says

* C.Suisse executive sees credit crunch risk from new rules

By Lisa Jucca

ZURICH, Nov 30 (Reuters) - Swiss regulators should not rush into imposing more rules on their banks, as they risk burdening them while foreign rivals have yet to adopt the same practices, a top executive at Credit Suisse (CSGN.VX) said on Monday.

Switzerland has been faster than other countries to push through tougher requirements for banks' capital and bankers' compensation in the aftermath of the financial crisis.

The Swiss state has also already withdrawn the financial support it offered to UBS (UBSN.VX) (UBS.N), its biggest bank by assets, when it faced a crisis last year.

But rival financial centres are not yet at this stage and Swiss rulemakers should cool their regulatory fervor and wait for the introduction of new international standards, for instance on the issue of liquidity rules, Hans-Ulrich Meister, chief executive of Credit Suisse Switzerland said.

"Here I have a clear opinion. First we have to wait so that all the other countries really come to the standards that Switzerland has implemented on the Tier I (capital adequacy), on the leverage ratio, on the compensation issues," Meister said on the sidelines of the annual Swiss Finance Institute meeting.

"If we handle this liquidity issue now, this would not be an international issue, but just a Swiss-based issue. Are we under the illusion that others will follow up?"

Under new liquidity rules currently in the works in Switzerland, the country's largest banks would not be able to use a large part of their deposits for lending. They would need to top them up with a pool of liquid assets such as government bonds to face unusually high requests for deposit withdrawals in a time of crisis.

But this could have the unintended consequence of restricting credit for small and medium enterprises, Meister said.

"If the price of capital is higher this has a direct impact on the lending and the risk is really that you create a credit crunch and we should not do that ," he said.

The new Swiss rules on liquidity are expected to be ready some time next year.

Jean-Baptiste Zufferey, a professor at the University of Fribourg and also a senior member of Swiss financial regulator FINMA said he did not believe the upcoming liquidity regime would create a new credit crunch and said the new rules were being discussed with representatives from the banking industry.

But he acknowledged there was some resistance to the new regime.

"(The banks) consider this as an obstacle for business. It will make thinks more costly," he said.

INVESTMENT BANKING

Separately, Meister said the issue of splitting up the investment bank from the whole of Credit Suisse was not under discussion as private banking clients needed the support of investment banking services, especially in high-growth Asian emerging markets.

He also said that although Swiss rules looked set to be tougher than in other countries the topic of moving the bank's headquarters away from the Swiss home market was not under discussion at Credit Suisse.

UBS's chief executive, Oswald Gruebel, was quoted on Sunday as threatening to move the bank's headquarters out of Switzerland if the authorities impose too many new regulations in the wake of the crisis. [ID:nGEE5AS03B] (Editing by Greg Mahlich) ((Zurich Newsroom, zurich.newsroom@reuters.com, +41 58 306 7336))