US SEC removes legal obstacle to UBS' crisis-resolution plan

WASHINGTON, July 8 (Reuters) - ‌The U.S. ​Securities ​and Exchange Commission told UBS Group on Wednesday that it would ‌not object to certain securities transactions the ⁠bank may have to undertake if directed to ‌do so by the ‌Swiss regulator to ensure the bank's orderly resolution.

The SEC said it would not take ​enforcement action if UBS converted certain debt securities into equity without registering ⁠the offering with the U.S. regulator, removing a potential legal ​obstacle to the bank's crisis-resolution plans.

Here are some details:

• The guidance relates to ​a potential "bail-in" of the ‌bank, a crisis-management tool designed to recapitalize a failing lender by ⁠converting designated debt securities into equity rather than relying on taxpayer support.

• The SEC said ⁠a debt-to-equity exchange ordered by Switzerland's financial regulator would ​constitute an "offer" and "sale" of securities under U.S. law, but could qualify for an exemption from Securities Act ‌registration requirements.

• The letter helps address cross-border legal conflicts highlighted by ‌Swiss authorities' failure to implement Credit Suisse's ⁠resolution plan and ‌move instead to ​broker a rescue takeover by UBS.

(Reporting by Michelle Price; Editing by Mark ‌Porter)

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