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Norway’s $1.4 trillion sovereign wealth fund has become UBS Group AG’s largest shareholder as the Swiss bank attempts to win over international investors with its historic takeover of Credit Suisse.
Norges Bank Investment Management, which runs the world’s largest sovereign wealth fund, this month increased its stake in UBS, where it has been a shareholder for nearly 20 years, to more than 5%. .
Over the past six months, UBS executives have been under pressure to prove to investors that they can successfully pull off a state-orchestrated $3.4 billion bailout of former rival Credit Suisse. Many large fund managers are focused on how well UBS negotiates the complex integration process and how soon it can restart shareholder returns.
NBIM, already a top 10 UBS shareholder, has now surpassed U.S. investors Dodge & Cox and BlackRock to become the largest investor, according to S&P Capital IQ.
NBIM was also among the top 10 investors in Credit Suisse when it collapsed in March, but has been selling its stake.
At Credit Suisse’s last annual shareholder meeting in April, NBIM voted against a majority of board members and chairman Axel Lehmann, saying: “When a board is not acting in the best interests of shareholders, shareholders should The right to seek board changes.”
In an interview with Swiss media, NBIM CEO Nicolai Tangen said that within weeks of the acquisition agreement fine news: “The Swiss government took the right steps to rescue Credit Suisse. In doing so, it avoided a spin-off situation in the Swiss financial center and beyond.”
Since taking over as UBS chairman 18 months ago, Colm Kelleher has focused on winning support from large, mainly U.S., active fund managers to close the valuation gap between the bank and its Wall Street peers.
While Swiss-listed UBS Group AG trades at just over double its book value, Kelleher, who spent much of his career at Morgan Stanley, trades at twice its book value .
Senior UBS executives believe that despite the bank’s global reach, investors view the bank as focused on Europe, while Wall Street rivals benefit from a listing on the broader U.S. stock market.
Since UBS agreed to rescue Credit Suisse six months ago, its shares have risen more than 30%.
Investors and analysts reacted positively to the bank’s announcement last month that it would not seek state financial support for the deal.
At the end of August, UBS posted a profit of $29 billion in its second-quarter results – the bank’s biggest ever quarterly profit – and the stock gained further, almost entirely driven by its acquisition of Credit Suisse. accounting income.
Analysts predict UBS will restart share buybacks next year, which were suspended after agreeing to acquire Credit Suisse.
UBS and NBIM declined to comment.
Additional reporting by Richard Milne in Oslo
Svlook
