: Moody’s changes outlook on UBS to negative from stable

Moody’s Investors Service on Tuesday revised its outlook on Swiss bank UBS AG UBSCH:UBSG to negative from stable, after a similar move by S&P Global Ratings on Monday.UBS agreed to take over Credit Suisse in a $3.25 billion deal announced on Sunday and brokered by the Swiss government and central bank. The tie-up “poses significant financial, cultural and franchise related integration challenges for UBSG, including: the need to retain key CSG personnel while the transaction is underway; the need to minimize the loss of overlapping clients in its Swiss banking and wealth management businesses; and the need to unify the cultures of two somewhat different organizations while ensuring that overall risk appetite and controls are both enhanced and or maintained at levels defined by UBSG,” said a team at Moody’s led by Alessandro Roccati,senior vice president, Financial Institutions Group. He added that “creditor protection at UBSG is expected to remain strong, supported by UBSG’s robust capitalization, strong global wealth management franchise and leading position in Swiss banking.” Shares of UBS rose 3.5% in Europe and U.S.-listed shares were 3% higher.

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