UBS to Resolve Credit Suisse's Responsibilities Concerning RMBS, Forking Over $300 Million
In a significant move, UBS Group has settled a long-standing legal matter with the U.S. Department of Justice (DOJ) related to Credit Suisse's residential mortgage-backed securities (RMBS) business. The bank agreed to pay $300 million on August 1, 2025, to resolve all remaining Consumer Relief Obligations from a 2017 agreement[1][2][3].
This resolution concludes Credit Suisse’s outstanding obligations stemming from a broader $5.28 billion settlement Credit Suisse originally agreed to in 2017 for misconduct in packaging and selling RMBS between 2005 and 2007. The settlement included a $2.48 billion civil penalty paid to the U.S. government, plus approximately $2.8 billion in consumer relief measures such as loan modifications, forgiveness, and affordable housing financing[2][3].
The settlement amount of $300 million will be paid by UBS on behalf of Credit Suisse Securities (USA) LLC to resolve the outstanding consumer relief obligations from the 2017 RMBS case[1][2][3]. The payment finalizes Credit Suisse’s remaining Consumer Relief Obligations under the RMBS settlement related to misconduct before the global financial crisis[1][2][3].
The DOJ had alleged Credit Suisse knowingly securitized poor-quality mortgage loans and misrepresented associated risks, contributing to the 2007-08 financial crisis[2][3].
UBS expects to report a credit in its Non-core and Legacy division for the third quarter of 2025 due to the release of a contingent liability that was established during UBS’s acquisition of Credit Suisse as part of the purchase price allocation process[1][2][5].
This settlement aligns with UBS’s commitment to resolve Credit Suisse’s legacy issues swiftly and fairly, benefiting stakeholders by removing lingering legal uncertainties[1][2].
It is worth noting that this resolution pertains to a legacy issue related to Credit Suisse's RMBS business and is not expected to have a material impact on UBS's 2025 financial results[1][2].
In addition to this settlement, UBS has also recently settled another legacy probe related to Credit Suisse’s offshore accounts matter for approximately $511 million earlier in 2025, although that is separate from the RMBS case[2].
References:
[1] UBS Group AG (2025). UBS Resolves Legacy Credit Suisse Matter with U.S. Department of Justice. [Press Release]
[2] Reuters (2025). UBS to pay $300 million to settle U.S. probe of Credit Suisse's RMBS business. [News Article]
[3] The Wall Street Journal (2025). UBS to Pay $300 Million to Resolve U.S. Probe of Credit Suisse's RMBS Business. [News Article]
[4] Financial Times (2025). UBS to pay $300m to settle US probe into Credit Suisse's RMBS business. [News Article]
[5] UBS Group AG (2025). UBS Group AG Q2 2025 Results. [Financial Report]
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