Marketwatch had a piece today suggesting that banks of UBS and Credit Suisse may need to raise $68 billion more in capital.
The newspaper Sonntag quoted a parliamentarian as saying the nation’s Federal Banking Commission would require additional capital of about $39 billion for UBS and $29 billion for Credit Suisse, according to summary by Agence-France Presse.
The banks would likely have to sell equity to raise the capital, thus diluting current shareholders’ stake in the companies, the report said.
Whether UBS or Credit Suisse will need more capital, remains to be seen. Chances are, they will. However, the reality is that all these anomalies for the swiss banks, particularly UBS – could not have come at a worse time. The bank besides fighting to sustain its share price, is also fighting for its credibility. From a Department of Justice press release.
Also, on July 1st UBS got rid of four members of its non-executive board. An interesting fact – UBS and Credit Suisse combined assets amount to seven times Swiss GDP.
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