The Swiss government has formally earmarked CHF9 billion ($9.9 billion) of taxpayer funds to plug potential losses arising from the UBS takeover of banking rival Credit Suisse.
This content was published on
2 minutes
swissinfo.ch/mga
Español
es
UBS sella una garantía de 9.000 millones de CHF contra pérdidas por adquisiciones financiada por el Estado
“With the takeover of Credit Suisse, UBS is also taking over a portfolio of assets that does not fit UBS’s core business and cannot be integrated into the bank’s business and risk profile,” the government stated on Friday. “It comprises around 3% of the combined bank’s total assets.”
Under the terms of the agreement, UBS will absorb the first CHF5 billion of any losses as it clears these assets off its balance sheet. The Swiss taxpayer is on the hook for the next CHF9 billion, should the loss-absorbing guarantee be activated.
UBS has forked out a CHF40 million “set-up fee” to secure the guarantee and will pay annual “maintenance fees” equivalent to 0.4% of the guarantee funds. This equates to CHF36 million per year on the full CHF9 billion.
“UBS is obliged to manage the assets in such a way that losses are minimised and realisation proceeds are maximised,” the government said, pointing out that the unwanted Credit Suisse assets could also yield a profit when sold.
Some CHF100 billion of Swiss taxpayer funds had earlier been used to cover central bank loans to Credit Suisse in the build up to the takeover.
This loan has been paid back, netting the confederation a CHF111 million profit in fees from Credit Suisse so far this year.
More
More
The Swiss state as ‘an unwilling banker’
This content was published on
Rescuing banks is nothing new for the Swiss state. Back in the Great Depression, the government saved Schweizerische Volksbank from collapse.
Is reforming the Swiss pension system still possible, and if so, how?
Solutions still need to be found to meet the challenge of an ageing population and to improve the pensions of low-paid workers, the majority of whom are women.
Swiss to reduce administrative burden on farms from 2026
This content was published on
From 2026, the number of inspections of farms is to be reduced, without any loss of quality, said economics minister Guy Parmelin.
Swiss insurance boss proposes Singapore-style healthcare system
This content was published on
CEO of Swiss health insurer Sanitas has said that healthcare costs could be reduced if Switzerland were to follow the Singapore model.
Swiss minister talks crime and security in visit to the Netherlands
This content was published on
Swiss justice minister Beat Jans spent two days in the Netherlands discussing security, police cooperation and justice with international bodies.
Study finds more heavy metal detected in Swiss grassland
This content was published on
Copper and zinc can be expected to accumulate in the soil, particularly if farmyard manure is used for several years and is greater than the amount of nutrients absorbed by the grass. This was announced by the Federal Office for the Environment (FOEN) on Friday. The findings are based on the results of the seventh National Soil Monitoring of Switzerland (Nabo).
Lilo Baur wins Swiss Grand Prix for performing arts
This content was published on
The Swiss actress and theatre director Lilo Baur has received this year's Swiss Grand Prix for Performing Arts, also known as the Hans Reinhart Ring.
Court rules al-Qaeda supporter can stay in Switzerland
This content was published on
A Kurdish supporter of the Islamist terrorist network al-Qaeda can stay in Switzerland, the Federal Administrative Court has ruled. It has withdrawn the annulment of the man’s provisional admission.
This content was published on
The Office of the Attorney General of Switzerland (OAG) has closed criminal proceedings relating to the Swiss owners affected by the Volkswagen “Dieselgate” emissions scandal.
This content was published on
The employment outlook in Switzerland will remain stable towards the end of 2024, according to the KOF Swiss Economic Institute at ETH Zurich.
Swiss woman accuses Donald Trump of sexual assault
This content was published on
A former Miss Switzerland candidate has accused Donald Trump of sexually assaulting her in New York in 1993. The US Republican candidate’s campaign team has denied the accusations.
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.
Read more
More
UBS picks up chunk of assets escaping failed Credit Suisse
This content was published on
UBS bank saw $28 billion of new client assets in the first three months of the year as its rival, Credit Suisse, fell into ruin.
Credit Suisse reports CHF60bn of client withdrawals
This content was published on
Credit Suisse clients pulled out CHF61.2 billion of their assets in the first three months of the year as they rushed to leave the collapsing bank.
Credit Suisse agrees to CHF3bn takeover by rival Swiss bank UBS
This content was published on
Ailing Swiss bank Credit Suisse will be taken over by its rival UBS after a frantic last-ditch deal to prevent a catastrophic banking collapse.
You can find an overview of ongoing debates with our journalists here . Please join us!
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.