UBS to Pay Nearly $400 Million in Fines to Settle Credit Suisse’s Archegos Failures
UBS agreed to pay U.S. and U.K. regulators around $390 million in fines related to the investment firm Archegos Capital Management, whose collapse hammered Credit Suisse, a rival it acquired earlier this year. Credit Suisse engaged in “unsafe and unsound counterparty credit risk management practices” related to its dealings with Archegos, the Federal Reserve said. UBS completed its rescue of Credit Suisse in June, a merger forced on it by Swiss regulators after the smaller rival lost the confidence of clients and investors. The sudden unraveling of Archegos in March 2021 triggered more than $10 billion of losses across Wall Street trading desks. The family office, run by Bill Hwang, a longtime hedge-fund manager, took extremely concentrated and leveraged positions in a few stocks. When the value of the stocks plunged, Archegos was left owing billions of dollars to its lenders, who said they were unaware of the large positions Hwang had at rival banks.