This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.

You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/business/7673159.stm

The article has changed 2 times. There is an RSS feed of changes available.

Version 0 Version 1
Switzerland injects cash into UBS Switzerland unveils UBS bail-out
(about 2 hours later)
Switzerland is taking steps to strengthen its largest bank, UBS, the latest country to unveil a banking rescue plan. Switzerland is taking steps to strengthen its largest bank, UBS, becoming the latest European government to unveil a banking rescue plan.
UBS will raise 6bn Swiss francs ($5.3bn) from the Swiss government. UBS is raising 6bn Swiss francs ($5.3bn; £3.1bn) from the government.
It will also be able to transfer up to $60bn of toxic assets to a fund supported by the Swiss central bank. It will also be able to transfer up to $60bn of distressed assets to a fund supported by the Swiss central bank.
Credit Suisse said it had raised 10bn Swiss francs from major global investors, adding that it did not need to tap government funds at this time. Credit Suisse was also offered government assistance but was instead able to raise 10bn Swiss francs from major global investors.
The Swiss National Bank said its moves would help to stabilise the financial system and was favourable for the development of the Swiss economy. The Swiss National Bank (SNB) said its moves would help to stabilise the financial system and was favourable for the development of the Swiss economy.
In these turbulent times, we want to ensure that we do everything possible to safeguard the solidity of our bank Peter Kurer, UBS chairman
"The SNB is convinced that it will result in a sustainable reduction of the strains in the Swiss financial system," it said.
The government also said it would moderately increase the guarantee on bank deposits, echoing steps taken by other European countries.
Thankful
UBS has been one of the heaviest losers from the sub-prime crisis.
It will transfer its exposure to the US mortgage market and other assets to a fund controlled by the central bank.
The fund will be financed by $6bn from UBS and a $54bn loan from the central bank.
The SNB will receive interest on the loans and is entitled to a share in any profits the fund makes.
The Swiss National Bank said it was a "highly unusual" and "unprecedented" operation.
However, it said the risk of losses was limited because UBS had already made aggressive write-downs on its risky positions.
The additional $6bn capital injection means the Swiss government will emerge with a temporary 9.3% stake in UBS.
UBS thanked the Swiss government and central bank authorities for finding a "commercial solution".
"In these turbulent times, we want to ensure that we do everything possible to safeguard the solidity of our bank," said Peter Kurer, chairman at UBS.
"Their efforts and decisiveness to act swiftly demonstrates the professionalism of the Swiss financial centre."
Profit
UBS also announced that it made a small net profit of 296m Swiss francs in third quarter, mainly due to its wealth management business. Its investment banking arm made a loss of 2.8bn francs.UBS also announced that it made a small net profit of 296m Swiss francs in third quarter, mainly due to its wealth management business. Its investment banking arm made a loss of 2.8bn francs.
Credit Suisse said it expected to make a loss of 1.3bn Swiss francs in the three months to September.Credit Suisse said it expected to make a loss of 1.3bn Swiss francs in the three months to September.
Credit Suisse also said that the Qatar Investment Authority was among the group of global investors that had helped the bank to shore up its finances. The bank said that the Qatar Investment Authority was among the group of global investors that had helped the bank to shore up its finances.
Credit Suisse had been required by the SNB to strengthen its capital base.
"Over the past few months we have had a constructive and close dialogue with regulators about future capital requirements," said Brady W. Dougan, the bank's chief executive.