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Parliament satisfied with UBS action

Swiss bank UBS is returning to health and the government's emergency cash package has done its job, according to a parliamentary finance commission.

This content was published on September 4, 2009 - 12:45

"The fire is out," said commission president Fabio Abate on Friday, adding that state aid was no longer needed and it was now a question of rebuilding.

In October Bern gave UBS a cash injection of SFr6 billion ($5.6 billion) and the Swiss National Bank agreed to absorb in a special fund SFr40 billion worth of UBS's toxic assets. This has since gone down to SFr28 billion, the commission was told.

In addition, the SFr6 billion loan would be paid back at a value of SFr7.2 billion, resulting on a nice profit for the government.

UBS Chief executive Oswald Grübel told the House of Representatives finance commission on Friday that UBS's situation had improved over the past six months and government aid was no longer an issue.

The market had stabilised and confidence in UBs had increased, he added.

Abate said Grübel – who was brought in to rescue UBS in February after previously being head of the country's other major bank, Credit Suisse – had also made unambiguous comments about UBS's former management.

In the past, Grübel said, the bank hadn't been sufficiently protected against the influence of incompetent people.

Abate said UBS's salary policy hadn't been a topic of discussion.

swissinfo.ch and agencies

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