Switzerland’s largest bank has built up a war chest of $516 million (CHF510 million) to deal with resolving a €3.5 billion fine imposed by France for facilitating tax evasion and money laundering.This content was published on October 22, 2019 - 11:01
The bank revealed the amount on Tuesday in its third quarter report. It is a lot less than the €3.5 billion in fines and €800 million in damages imposed by French courts in February.
UBS is appealing the penalty in which the Swiss banking giant and its French subsidiary were accused of laundering proceeds from tax fraud carried out from 2004 to 2012. UBS denies these charges but in its third quarter report it acknowledged that there were high uncertainties in this matter and that it is possible that the final penalty may exceed the current provisions.
In an article published last week, the Handelszeitung paper reported that a first hearing of the bank’s appeal will be held on November 4 at the Paris Court of Appeal. However, the procedure may take years before a final decision is taken.
In the United States, the UBS case involving suspicious mortgage-backed securities (RMBS), which dates back to the 2008 financial crisis, remains unresolved. The bank had waived an out-of-court agreement in this case, considering that it was not the main issuer of the controversial loans. The amounts provided for fighting that case are "appropriate", according to UBS, which does not quantify them.
Total provisions for legal battles and fines have not changed significantly since the last quarter. At the end of September, they reached $2.50 billion, compared to $2.51 billion three months earlier.
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