Citigroup Inc. is not the only bank being battered in the markets. Swiss giant UBS' shares lost nearly 50% over the past month, and reports indicate that the bank may need another capital infusion as well. Daniel Zuberbuehler, director of the Swiss Federal Banking Commission, told
SonntagsZeitung newspaper on Sunday that the state will likely have to dole out more capital to keep the bank in business.
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However, UBS management said
further infusions are not needed at the moment, but could be needed in the future.
UBS has received Sfr29 billion ($23.77 billion) from new,
foreign investors and from existing shareholders on top of the Sfr6
billion ($4.88 billion) the Swiss government injected. The
government also gave UBS an option to offload up to $60 billion in
troublesome assets after risky investments at UBS' investment banking
division prompted $49 billion in write-downs.
Like Citi, there was speculation that UBS may be forced to sell assets
or merge with another bank, such as chief rival Credit Suisse Group. However, because any
merger would involve a bank taking on UBS without the government's
rescue package, chances are slim any deals are in the works, according
to
Reuters.
- Maria Woehr
