Bern and Zurich, Switzerland (GenevaLunch) – Shares in the bank UBS rose nearly 5 percent by closing Thursday 20 August in Zurich to CHF17.56 after the Swiss government sold its 9 percent stake, 332.2 million shares (convertible notes to be converted 25 August), at a price of CHF16.50. The sale had been announced late Wednesday. In addition, UBS has agreed to pay the government CHF1.8b in cash, which waives its right to future coupons on the convertible notes.

The government has thus withdrawn its stake in the bank completely, and the initial investment of CHF6 billion in January 2009 to bail out the bank has been completely recovered, with the government making a net profit of CHF1.2b.

The eight-month investment provided an annual rate of return of more than 30 percent.

Bern noted in its announcement of the sale that the shares were subscribed several times over – Bloomberg reports four times over – with the sale welcomed by institutional investors.

Related: Bloomberg, Forbes/Reuters

Posted by Ellen Wallace on 20 August 2009 at 17:15 | permalink
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News story, GenevaLunch, 20 August 2009.

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Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported
This work by genevalunch.com is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported.