Singapore sovereign wealth fund GIC sells UBS stake at a loss
GIC had nursed deep losses on the Swiss bank, which was fined heavily after a money laundering crackdown related to Malaysia’s 1MDB
Singapore sovereign wealth fund GIC is selling part of its stake in Swiss lender UBS at a loss, nearly a decade after it first invested in the bank at the height of the financial crisis.
GIC sold 93 million UBS shares, effectively halving its stake in the Swiss lender from 5.1 per cent to 2.7 per cent.
“GIC made the UBS sale despite the loss because conditions have changed fundamentally since GIC invested in UBS in February 2008, as have UBS’ strategy and business. It makes sense now for GIC to reduce its ownership of UBS and to redeploy these resources elsewhere,” said GIC chief executive officer Lim Chow Kiat.
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GIC did not say how much it sold its stake for, but shares of UBS fell 1.3 per cent to about 16.61 francs. At this price, 93 million UBS shares are worth about US$1.55 billion.
The sovereign wealth fund was among the first big institutional investors to inject funds into UBS and Citigroup, after both were rocked by the global financial crisis.
It purchased more than 11 billion francs worth of UBS debt that converted into UBS shares at a price of between 51.48 Swiss francs and 60.23 Swiss francs a share.
In early 2010, when the conversion took place at a reported price of about 47.77 Swiss francs a share, UBS shares were trading at about 13 Swiss francs.
