UBS Fined $268.5 Million in 2025 for Credit Suisse's Pre-Merger Misconduct
In 2025, UBS faces a $268.5 million fine imposed by the U.S. Federal Reserve due to misconduct by Credit Suisse prior to their March merger, highlighting major risk management failures.
In 2024, the U.S. Federal Reserve imposed a substantial $268.5 million fine on Swiss banking giant UBS for misconduct linked to its former rival, Credit Suisse, before their merger in March.
Key Highlights
- UBS fined $268.5 million by the Federal Reserve for Credit Suisse’s pre-merger misconduct.
- Misconduct centers on unsafe counterparty credit risk management related to Archegos Capital Management.
- Additional penalties from Swiss and UK regulators bring UBS’s total fines to approximately $387 million.
- UBS stock showed resilience, closing up 0.75% despite the fines.
The Federal Reserve's consent order targets Credit Suisse’s inadequate risk controls, particularly involving Archegos Capital Management LP, whose collapse caused massive losses. UBS, having acquired Credit Suisse in March 2024, now shoulders the financial repercussions.
Alongside the U.S. fine, UBS faces penalties from the Swiss Financial Market Supervisory Authority and the Bank of England’s Prudential Regulation Authority, bringing the total regulatory costs close to $387 million.
Credit Suisse suffered a $5.5 billion loss due to Archegos’s $20 billion collapse, a fallout attributed to poor risk management despite multiple warnings. This crisis led to the resignation of Credit Suisse’s CEO and chief risk officer following a $252 million quarterly loss linked to third-party exposures.
Sam Woods, CEO of the Bank of England’s PRA, emphasized the gravity of Credit Suisse’s failures, describing them as "extremely serious" and a significant threat to financial stability, resulting in the largest fine ever imposed by the PRA.
Despite these challenges, UBS shares gained 0.75% on the day of the announcement, demonstrating market confidence in the bank’s future.
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