The Swiss National Bank urged UBS and Credit Suisse Group to step up efforts to build up capital, cautioning that high-quality cash cushions are too thin for the amount of risk the banking giants are taking given the broader economy's fragility.

"In view of the big banks' continuing high leverage and the considerable risks in the economic environment, it is crucial that a sufficient base of loss-absorbing capital be laid down as soon as possible," the SNB wrote in its annual report on financial stability in Switzerland, released Thursday to coincide with the central bank's rate-setting session.