2023-07-30 23:34:31
Global banking giant UBS has been fined more than a quarter of a billion dollars for misconduct at Credit Suisse, its new subsidiary acquired in June.
In a press release from the Federal Reserve Board of Governors, the Fed says the accusations center on Credit Suisse’s “unsafe and unsubstantiated counterparty credit risk management practices” with Archegos, a family office that collapsed in March 2021.
Archegos, which represented the personal assets of Korean-American investor Bill Hwang, was worth $36 billion at its peak before going bankrupt due to overly aggressive leverage and bad trades. According to Bloomberg, Hwang lost $20 billion in less than two days.
Due to its relationship with Hwang, Credit Suisse suffered losses of approximately $5.5 billion from the default of Archegos, which the Fed says might have been avoided with proper risk management. credit.
“During its relationship with Archegos, Credit Suisse failed to adequately manage the risk posed by Archegos despite repeated warnings.
Board directs Credit Suisse to improve its counterparty credit risk management practices and address other long-standing deficiencies in other risk management programs within Credit’s U.S. operations Swiss “.
The Governor’s Council fine once morest UBS is issued in conjunction with the Swiss Financial Market Supervisory Authority and the Bank of England’s Prudential Regulatory Authority.
UBS, which manages $3.1 trillion in assets, is also being urged by the Fed to take the necessary steps to ensure that its Credit Suisse subsidiaries and branches operate safely, comply with regulations and take into account supervisory actions taken by federal and state supervisory authorities.
Writer for the news site Essonneinfo. Hélène specializes in writing and journalism, she likes to share interesting information and news with readers. Apart from her journalistic activities, Hélène is passionate regarding arts and culture, she likes to go to museums, discover new exhibitions and attend concerts.
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