UBS sells stake in CS joint venture to Chinese sovereign wealth fund
Published: Tuesday, Jun 25th 2024, 11:10
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UBS is partially exiting the securities business of the former Credit Suisse in China. The big bank is selling a stake in Credit Suisse Securities (CSS) to a Chinese sovereign wealth fund. Since the CS takeover, UBS has held two licenses for the securities business in China, which a foreign bank is not allowed to do.
UBS will receive 91.4 million US dollars from Beijing State-owned Assets Management Co. (BSAM) for a 36.01 percent stake in CSS, according to a statement on Tuesday. 14.99 percent of the 51 percent stake will remain with the Swiss bank.
CSS was founded in 2008 as a joint venture between Credit Suisse and the Chinese financial services provider Founder Securities. Since June 2020, CS has held a 51% stake and Founder Securities the remainder.
With the transaction now agreed, Founder Securities is also selling its entire 49% stake to BSAM for 124 million dollars. This means that the Chinese sovereign wealth fund will hold a total of 85.01%.
China is a key market for UBS, CEO Sergio Ermotti was quoted as saying in the press release. However, the takeover by Credit Suisse would mean a larger presence in the country and certain regulatory requirements would have to be met.
Bloomberg reported almost two weeks ago that UBS was in talks with BSAM.
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