UBS fined $387 mn over Credit Suisse misconduct: US Fed
Source: AFP
The Swiss banking giant UBS has been fined close to $400 million for misconduct by its recently-acquired subsidiary, Credit Suisse, the US Federal Reserve announced on Monday.
Swiss regulators pushed UBS to take over its former rival Credit Suisse earlier this year amid a banking crisis spurred by the collapse of US regional lender Silicon Valley Bank.
On Monday, UBS was fined a total of $387 million by the Fed and the Bank of England over Credit Suisse's failure "to adequately manage" the risk posed by the US family investment fund Archegos, despite repeated warnings, the Fed announced in a statement.
The dramatic implosion of the family hedge fund run by Bill Hwang cost Credit Suisse around $5.5 billion in losses.
The Fed said "the misconduct involved Credit Suisse's unsafe and unsound counterparty credit risk management practices" with Archegos, and announced a consent order and a fine for UBS worth $268.5 million.
The Bank of England's Prudential Regulation Authority would also be fining Credit Suisse's new owner, the Fed announced, adding that the sum total of fines levied by the two regulators would be approximately $387 million.
The action against UBS is being taken in conjunction with the Swiss Financial Market Supervisory Authority, the Fed said.
Source: AFP
