2023-08-11 06:00:26 ET
UBS ( NYSE: UBS ) stock price gained 4.9 % in the early hours of Friday as the bank voluntarily terminated the CHF 9B ($10.3B) loss protection guarantee extended by the Swiss government after an assessment of Credit Suisse's non-core assets and stress loss scenarios.
As part of the government-brokered takeover of Credit Suisse, UBS ( UBS ) was offered a loss protection deal to cover any losses realized when winding down Credit Suisse's assets.
After reviewing all assets once the Credit Suisse takeover was complete, UBS ( UBS ) decided it no longer required the guarantee as well as the CHF 100B ($114.1B) public liquidity backstop, as all loans under the PLB were fully repaid by Credit Suisse.
"Credit Suisse has also paid back the Emergency Liquidity Assistance Plus loan of CHF 50B (~$57B) to the Swiss National Bank," said UBS ( UBS ). "Credit Suisse paid a risk premium totaling CHF 476M ($543.2M) to the SNB."
"The Confederation did not have to assume any losses arising from these guarantees," the Swiss government said in a statement . "With the termination of these guarantees, the associated financial risks have also ceased to apply for the Confederation and taxpayers."
"The Confederation earned receipts of around CHF 200M ($228.1M) on the guarantees," it added.
More on UBS-Credit Suisse backstory:
-
UBS agrees to pay nearly $400M to settle Credit Suisse's Archegos missteps
-
UBS, Swiss govt sign loss protection pact for Credit Suisse acquisition
For further details see:
UBS ends Swiss govt guarantees in Credit Suisse deal, stock rises 5%