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In a regulatory filing published on Tuesday, UBS expects its loss protection agreement with the Swiss government to be finalized today. Under the agreement, UBS will commit to cover the first CHF 5bn in potential losses resulting from its emergency takeover of Credit Suisse (CS), with the government agreeing to back a further CHF 9bn. The filing added that any further loss guarantee over CHF 14bn “requires a separate legal basis in the form of a parliamentary approval in the ordinary legislative procedure as well as the commitment credit”. This agreement marks the clearance of one of the final hurdles before UBS can officially close its acquisition of CS. Earlier this week, UBS said that it expects to complete the CS acquisition “as early as 12 June 2023”.
UBS’s 7% Perps are trading at 96.8 cents on the dollar, yielding 12.27% to call.
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