UBS Announces Successful Completion of Public Tender Offer

UBS has accepted for repurchase certain of its senior and subordinated debt and covered bonds in an aggregate principal amount of approximately CHF 6.1 billion.

ZURICH & BASEL, Switzerland--(BUSINESS WIRE)-- Regulatory News:

UBS (NYSE: UBS) (SWX: UBSN) announces the successful completion of the cash tender offers, announced on 4 December 2015, to re-purchase 17 issues of its senior, subordinated debt and covered bonds with an aggregate principal amount equivalent to approximately CHF 16 billion. 14 securities with an aggregate principal amount equivalent to approximately CHF 6.1 billion were accepted.

This transaction is consistent with our proactive approach to optimizing the Group's interest expense, while maintaining our strong liquidity, funding and capital position.

We expect to record an expense in the fourth quarter of 2015 related to this transaction of approximately CHF 272 million, which will be recognized as negative other income within Corporate Center - Group Asset and Liability Management and will be treated as an adjusting item in determining the Group's adjusted operating profit/ (loss) before tax. We expect to recover the expense incurred in approximately 1.6 years primarily through reduction of future interest expense from the purchased bonds. The repurchase of the bonds is expected to have an immaterial effect on our CET1 ratio, however the transaction will reduce our BIS Basel III phase-in total capital by approximately CHF 658 million. Some of the subordinated bonds repurchased are currently eligible as Tier 2 under the BIS Basel III phase-in rules, but will not be eligible for Tier 2 capital treatment on a fully-applied basis beginning in 2019 and are not expected to be eligible as loss absorbing capacity under the anticipated revisions to the Swiss "too-big-to-fail" regulation.

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Cautionary Statement Regarding Forward-Looking Statements

This release contains statements that constitute "forward-looking statements". While these statements represent UBS's expectation concerning future developments, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from UBS's expectations. In addition, these results could depend on other factors that we have previously indicated could affect our business and financial performance which are contained in our past and future filings and reports, including those filed with the SEC. More detailed information about those factors is set forth in documents furnished by UBS and filings made by UBS with the SEC, including UBS's Annual Report on Form 20-F for the year ended 31 December 2014. UBS is not under any obligation to (and expressly disclaims any obligation to) update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.

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Source: UBS

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