UBS Q2 profits beat forecasts
A number of European banks including Deutsche Bank, Barclays, Credit Suisse, HSBC and Royal Bank of Scotland collectively face possible multi-billion euro bills arising from US cases involving mortgages, which lay at the heart of the 2008 financial crisis.
UBS said yesterday it had reached an agreement in principle with the Federal Housing Finance Agency, prompting it to release its headline second-quarter results more than a week early, showing net profit had jumped by nearly two thirds.
The Zurich-based bank did not say how much the agency settlement would cost but it took a charge of about €700m to cover litigation costs, provisions and writedowns related to the deal and a Swiss tax agreement with Britain.
The agency sued 18 banks, accusing them of misleading US government- sponsored mortgage companies Fannie Mae and Freddie Mac about €152bn in mortgage-backed bonds they purchased.
UBS did not reveal whether it would admit to mis-selling the bonds.