Exclusive-UBS has received a new US pension license that corrects a paperwork error, filings show
By Stefania Spezzati and Ariane Luthi
LONDON (Reuters) – The U.S. Labor Department has cleared UBS to continue managing U.S. pension plans after a paper error by the Swiss bank put at risk $11 billion in assets the lender controls.
After a five-month review, the US agency said in a notice published on Wednesday that UBS can now rely on qualified professional asset manager status in the US until June 2029.
The exemption, first reported by Reuters, is retroactive and will take effect from June 2023, when the bank took over failed rival Credit Suisse.
UBS needs amnesty to serve US pensioners because in recent years the bank has been convicted in France of crimes including market manipulation and tax evasion.
The agency said UBS groups operating in the U.S. pension market should be shielded from the doomed UBS and Credit Suisse entities and trusted to protect their assets.
In the year UBS, which has been operating independently since 2013, has been told it could receive a new consolidated amnesty after the Credit Suisse merger, subject to meeting certain conditions, including submitting an audit report by January 2024.
UBS missed that deadline, according to hundreds of pages of the announcement documents, which were reviewed by Reuters.
In the year As early as 2024, UBS was told by the department that the bank appears to have lost its independence, according to the letter.
However, it took months for the error to be corrected, according to correspondence between the bank and the US agency from July.
The episode provides a rare glimpse into the enormous challenges UBS faces in integrating Credit Suisse – the biggest banking merger since the 2008 global financial crisis – and the paperwork and regulatory approvals it needs to acquire and retain.
A letter from UBS’s legal representative to the US agency on July 29 indicated that the missed deadline had forced UBS to restructure its US compliance team.
In the letter, UBS said it “deeply regrets the oversight” and that the delay was “unacceptable”, adding that the Credit Suisse merger was a “tough and demanding matter”. He also said “many customers will leave UBS without a freebie.”
A UBS spokeswoman declined to comment. A representative for the US Department of Labor did not respond to a request for comment.
The misstep put UBS at risk of losing more than $11 billion of business under management, a key part of the bank’s asset management business.
