News Column

UBS Boosts Quarterly Profit Despite Legal Costs

July 22, 2013

Switzerland's biggest bank, UBS, said Monday that its net profit rose 62 per cent in the second quarter, compared with the same period last year, to 690 million Swiss francs (733 million dollars).

It said the rise came even though it had earmarked funds for a dispute over mortgage bonds in the United States.

UBS said it had reached an agreement over a claim by the US Federal Housing Finance Agency relating to bonds backed by private US real estate loans.

These bonds were sold by UBS and other banks, and their loss in value contributed to the financial crisis of 2008.

The US agency has filed cases against 18 financial institutions on behalf of Fannie Mae and Freddie Mac, US-government-sponsored enterprises that sell mortgage-backed securities to increase the supply of money available in the US for home purchases. Both enterprises had to be bailed out by the US government in the wake of the crisis.

UBS did not disclose the amount it had set aside but said the money was included in 865 million francs it had allocated for legal settlements.

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Source: Copyright 2013 dpa Deutsche Presse-Agentur GmbH. Distributed by MCT Information Services

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