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UBS sets aside €800 million for investors hit by Greensill collapse

The logos of the Swiss banks Credit Suisse and UBS in Zurich, Switzerland, on March 19, 2023.
The logos of the Swiss banks Credit Suisse and UBS in Zurich, Switzerland, on March 19, 2023. Copyright Michael Buholzer/Keystone
Copyright Michael Buholzer/Keystone
By Eleanor Butler
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After taking over Credit Suisse in 2023, Swiss bank UBS is now clearing up the mess left by its former rival.

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UBS has offered to repay former Credit Suisse customers funds that were invested in Greensill Capital, a firm that collapsed in 2021.

$900 million (€840 million) has been set aside for the compensation, and investors will be able to recoup 90% of the value of their lost assets.

The offer will remain open until the end of July.

UBS has been working to mop up Credit Suisse's legacy since it acquired the lender one year ago.

The collapse of the rival bank was largely brought on by the failure of supply chain financing firm Greensill Capital, which accounted for funds worth $10 billion (€9.3 billion). 

Before its demise, Greensill offered loans to businesses to allow them to pay suppliers. This money would then be paid back with added interest.

In partnership with Greensill, Credit Suisse offered funds where investors could put money towards these supply chain finance deals.

Greensill's insolvency was precipitated when the firm failed to re-secure an insurance deal for loans, a decision which spooked investors. 

Many Credit Suisse customers with Greensill-linked investments subsequently saw their funds trapped.

The collapse also triggered a major lobbying scandal in the UK. 

When Greensill first began to find itself in financial difficulty, former prime minister David Cameron - working for the firm - sought to secure government loans offered as a pandemic support measure.

In doing so, he was accused of using his political connections to promote Greensill's business interests.

In a statement released on Monday, UBS said that its repayment offer "aims to give fund investors certainty, an accelerated exit from their positions and a high level of financial recovery".

The offer is not expected to have a material effect on UBS' financial results or capital requirements, added the bank.

The $900 million will be taken from a $4 billion pool (€3.7 billion), put aside by the bank to cover litigation and regulatory fees when it acquired Credit Suisse.

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