One year after bankruptcy: Billions given to UBS

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Credit Suisse’s fall was UBS’s chance. The big bank is now worth 30 billion francs more than a year ago. The share price is up over 60 per cent in the last twelve months. UBS shares are more expensive than they have been in 16 years. But CEO Sergio Ermotti wants more. It wants to significantly expand its business with wealthy clients in the US and even expand its investment banking business. In doing so, it hopes to increase its share price even further.

He need hardly fear the wind coming from Bern. Anti-bank sentiment has disappeared. Moves that called for a tougher approach against UBS were set aside by civilian assistance. The financial center’s lobbying efforts are running smoothly as usual. If there are stricter regulations, then they will be regulations that only banks can live by. It would be naive to believe otherwise.

What if it explodes again? Then the state will throw out the lifeline again and use hundreds of billions to prevent bankruptcy. Regulatory experts can say whatever they want: Legal measures to ensure an orderly liquidation without state assistance will not work even then.

But this also means that UBS has an unlimited government guarantee for which it pays nothing. Since this is an untenable situation even from a liberal point of view, bourgeois politicians also need to defend compensation for the state guarantee. For them it is also a matter of self-esteem.

Source :Blick