UBS seeks to sell loans Credit Suisse gave to junk Italian firms
UBS Group is planning to sell its exposure to a portfolio of loans that Credit Suisse made to junk-rated Italian companies, according to people with knowledge of the matter.
The Swiss bank is seeking an exit from the revolving credit facilities for five borrowers, said the people, who asked not to be identified because they’re not authorised to speak publicly about the matter. Goldman Sachs Group is carrying out the sale on behalf of UBS, said the people.
The chunks of debt range in size from €10 million (CHF9.45 million) to €40 million and prices are indicated at par or just below, said the people. Bids for Credit Suisse’s positions are due in the first half of January, they said.
A representative for UBS declined to comment. Bloomberg News has reached out to Goldman Sachs for comment.
Here is a full list of the borrowers:
Representatives for Rekeep and Marcolin declined to comment, while those at Fabbrica Italiana Sintetici, Itelyum and Rossini didn’t respond to a request for comment.
The loans aren’t Credit Suisse’s only exposures to leveraged borrowers being offered for sale, the people said.
UBS has been going through Credit Suisse assets since closing the takeover of the smaller rival in June as it seeks to ensure the acquired businesses conform with its more conservative risk approach.
The bank has also set up a wind-down unit, known as Non-core and Legacy, which houses businesses brought over from Credit Suisse that are not compatible with its strategy. Last month, the unit widened its quarterly pretax loss to $1.93 billion, leading UBS to its first quarterly loss in almost six years.
Small pool
The Italian package of loans is likely to appeal to a limited pool of buyers only as regulations dictate that financial firms have to have a local banking licence to carry out lending activities.
The final weeks of the calendar year are usually a busy period for credit trading as banks look to trim risk from their balance sheets.
Bloomberg News reported last week that Morgan Stanley was sounding out interest from potential buyers for portions of revolving credit facilities and term loans to companies across Europe at a discount of as much as 15% versus its face value.
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