UBS bails on bailout

Sergio Ermotti

Bail to the Chief.

UBS will repay a loan and buy back equity in a fund set up as part of its 2008 bailout, a move the bank said on Tuesday would bolster its capital later this year.

Reuters reports that the move draws a line under the Swiss government's rescue of UBS nearly five years after the bank threatened to collapse under the weight of more than $50 billion in losses on mortgage securities.

'The results show that our strategy is right and we're ahead on execution', UBS's Chief Executive Sergio Ermotti said in a statement.

UBS's shares hit a two-year high last week after the bank disclosed a quarterly profit that beat analyst views, even after paying $885m to settle a lawsuit with the U.S. housing regulator over the mis-selling of mortgage-backed bonds.

In its outlook on Tuesday, UBS said third-quarter revenue and net new money - a closely-watched bellwether of future business - may be hit as clients fret about the euro zone, U.S. debt trouble, as well as the mixed global economic outlook.

Hit the link below to access the complete Reuters article:

UBS to repay Swiss bailout loan, cautious on Q3

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image: © UBS

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