UBS assessed the financial consequences of the purchase of Credit Suisse – Kommersant

UBS expects a $34.8 billion one-time gain from the Credit Suisse purchase because the bank’s bad business reputation has eroded its value. About this UBS informed today, May 17, in a document filed with the US Securities and Exchange Commission. UBS estimates the potential negative financial effect of the transaction at $17 billion. This is due to the adjustment of the value of the bank’s assets and debt obligations, possible legal costs, etc.

In general, UBS notes that the profit from the transaction covers the costs associated with it. So, if the deal closes in June as planned, it will boost the bank’s profit in the second quarter. The bank noted that these are preliminary estimates and in the future they may change significantly. “This financial information does not provide an estimate of the funds required for the restructuring, as they will be disbursed after the completion of the transaction,” said Andreas Vendetti, an analyst at Vontobel. Analysts at investment company Jefferies previously estimated the total cost of the restructuring, legal costs and costs associated with the spin-off of non-core divisions at $28 billion.

In March, the Swiss National Bank announced about the emergency merger of the two largest banks in the country – UBS and Credit Suisse. The reason was long-term corporate scandals and financial problems of Credit Suisse, which ended 2022 with a loss of $7.9 billion, the worst result of the bank since 2008. UBS will pay $3.4 billion for the purchase.

Yana Rozhdestvenskaya