UBS sells subprime assets to BlackRock-run fund for $15 billion
Swiss bank UBS AG said Wednesday it has sold subprime and other mortgage-based securities with a nominal value of US$22 million for US$15 billion (euro9.5 billion) to a newly created investment fund run by U.S. asset manager BlackRock Inc.
By Agencies |
ZURICH: Swiss bank UBS AG said Wednesday it has sold subprime and other mortgage-based securities with a nominal value of US$22 million for US$15 billion (euro9.5 billion) to a newly created investment fund run by U.S. asset manager BlackRock Inc.
The sale is part of an attempt by Switzerland's largest bank to offload risky positions that contributed to its massive writedowns of US$37.4 billion over the past nine months.
The securities had a nominal value of about US$22 billion (euro14 billion), but have been listed with a book value of US$15 billion since March, UBS said. Investors have shunned mortgage-backed securities over fears too many of the mortgages were made to people with shaky credit who may eventually default.
The fund received a US$11.25 billion (euro7.14 billion) loan from UBS to buy the assets.
UBS shares were down 3.7 percent at 30.56 Swiss francs (US$29.70; euro18.85) on the Zurich exchange.
The sale is part of an attempt by Switzerland's largest bank to offload risky positions that contributed to its massive writedowns of US$37.4 billion over the past nine months.
The securities had a nominal value of about US$22 billion (euro14 billion), but have been listed with a book value of US$15 billion since March, UBS said. Investors have shunned mortgage-backed securities over fears too many of the mortgages were made to people with shaky credit who may eventually default.
The fund received a US$11.25 billion (euro7.14 billion) loan from UBS to buy the assets.
UBS shares were down 3.7 percent at 30.56 Swiss francs (US$29.70; euro18.85) on the Zurich exchange.
Download
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
