Receive free UBS updates
we will send you myFT Daily Digest Email summary of latest news UBS There is news every morning.
Just ahead of the London trial, Swiss banks have reached a settlement with the Mozambican government over Credit Suisse’s involvement in an alleged £2 billion “tuna bond” fraud that wreaked havoc on the country’s finances.
Credit Suisse and Mozambique “have mutually released each other from any liabilities and claims related to loans and bond issuances arranged for the country in 2013,” UBS said on Sunday.
The loans were ostensibly to finance projects including the state-owned tuna fishery, but later fell into default amid alleged looting of hundreds of millions of dollars. The borrowing was partly hidden from the International Monetary Fund and other donors, who cut support for the country after the loans were discovered.
UBS Group AG, which has been grappling with Credit Suisse’s legacy of legal problems since acquiring the bank in a bailout deal six months ago, will not pay any cash under the settlement, according to people familiar with the matter. .
Mozambique claims ahead of a three-month trial set to begin on Monday that Credit Suisse and other defendants ignored hundreds of millions of dollars in “tuna bond” loans that were plundered through bribes and kickbacks.
The country is seeking $1.5 billion in compensation, including financial losses after the International Monetary Fund and international donors withdrew funding.
“Both parties are pleased to have resolved this long-running dispute stemming from events a decade ago,” UBS said.
Credit Suisse has settled scandals with four regulators in three countries in 2021, paying $475 million in fines and canceling $200 million in Mozambique debt.
Mozambique is still suing Privinvest, a Gulf supplier of ships and other equipment, accusing the shipbuilder of paying $136 million in bribes.
Privinvest denies wrongdoing and says it conducted legitimate business activities with government officials and paid $10 million in campaign contributions to President Filipe Nyusi and the ruling party.
On Saturday, Privinvest said it had been allowed to appeal an earlier ruling that Nyusi could not be prosecuted as part of the case, which could mean the trial will be delayed depending on the judge’s response to the appeal.
Judge Robin Knowles ruled that Nyusi had immunity as a foreign head of state, but Privinvest argued that he should be included in response to what it called “a cynical attempt by the Republic to recoup the money spent on these projects”.
UBS said in a separate statement on Saturday that it was not aware that the U.S. Justice Department was investigating whether Credit Suisse failed to comply with Russia-related sanctions.
Previously, a Bloomberg report last week caused UBS shares to fall 7%, but they basically recovered by the end of this week.
“Recent reports that the U.S. Department of Justice is allegedly investigating Credit Suisse and UBS for sanctions-related compliance failures are inaccurate,” the bank said. “We are unaware of such an investigation. UBS and UBS have significantly Proactively reduce exposure to Russia-related risks.”
The U.S. Justice Department declined to comment.
Svlook
