UBS Writes Down $10B; Sells $11.5B Stake

Subprime exposure will cost bank Q4 profit, result in loss for the year
By Jim O'Neill,  Newser Staff
Posted Dec 10, 2007 7:32 AM CST
UBS Writes Down $10B; Sells $11.5B Stake
The logo on the headquarters of the Union Bank of Switzerland (UBS) is seen in this Feb. 14, 2006 file photo.   (Associated Press)

Investors from Singapore and the Mideast will breathe $11.5 billion in new capital into UBS as the Swiss banking giant announces that it will write down an additional $10 billion in subprime holdings, Bloomberg reports. The bank said the subprime losses, the biggest  by a European bank, will wipe out expected fourth quarter profits, resulting in a loss for the year.

UBS said the government of Singapore's investment arm will buy a 9% stake in the bank for 11 billion francs. An unidentified Middle Eastern investor, rumored to be the government of Abu Dhabi, which last month poured $7.5 billion into Citigroup, will add 2 billion more. UBS shares rose 1.5 francs to 58.7 francs, after initially dropping as much as 3.4%. (More UBS stories.)

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