LONDON, June 12 (Reuters) – A committee that evaluations disputes within the credit score default swaps (CDS) market mentioned on Monday that it had been requested to deal with a query of whether or not there’s a successor to Credit score Suisse Group.
This comes on the day that UBS (UBSG.S) accomplished its emergency takeover of embattled native rival Credit score Suisse (CSGN.S), creating a large Swiss financial institution with a steadiness sheet of $1.6 trillion and better muscle in wealth administration.
The CDS panel mentioned on its web site it has accepted the query by an investor and it’ll meet on Tuesday at 13:00 GMT to debate it.
If a succession occasion happens, the related successor will turn into a reference entity for the needs of a CDS.
An investor famous that on this case, UBS Group AG would turn into the brand new reference entity for Credit score Suisse Group’s CDS contracts, however except there’s a credit score occasion, the CDS contracts wouldn’t be triggered and UBS wouldn’t be liable.
Buyers’ hopes for a payout on Credit score Suisse’s CDS had been dashed twice by the committee, which mentioned that neither a so-called authorities intervention credit score occasion nor a chapter credit score occasion had occurred.
The state-orchestrated merger will create a bunch that oversees $5 trillion in belongings, giving UBS a number one place in key markets it might in any other case have wanted years to develop in dimension and attain, whereas bringing to an finish Credit score Suisse’s 167-year historical past, marred in recent times by scandals and losses.
Reporting by Chiara Elisei, modifying by Karin Strohecker
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