UBS Alters $6bn Buyback Program Following Credit Suisse Takeover

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UBS has announced changes to its $6bn share buyback program following its takeover of Credit Suisse. The bank said that instead of cancelling the shares as originally planned, it will now use some of the shares for the takeover after receiving approval from the Swiss Takeover Board. Under the deal, one UBS share will be exchanged for 22.48 shares in Credit Suisse, which requires a maximum of 178 million UBS shares to be used. So far, the buyback program has seen 298.5 million shares bought back, representing 8.47% of the bank’s stock.

UBS, Switzerland’s largest bank, agreed in March to buy rival Credit Suisse for 3 billion Swiss francs in stock and assumed up to 5 billion francs in losses, in a deal engineered by Swiss authorities to prevent market-shaking turmoil in global banking. However, UBS has now decided not to issue new shares for the deal but to use shares that have already been issued. The Swiss bank’s decision to modify its buyback program follows in the footsteps of other global banks that have revised their capital deployment strategies to adapt to market changes.

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