UBS Group initiates first bond sale since Credit Suisse takeover

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UBS Group AG (SIX:UBSG) is in the process of selling its first bond from the parent company since its takeover of Credit Suisse (SIX:CSGN) in March 2023, according to an anonymous source familiar with the matter. The company has opened books on a three-part bond offering in dollars, expected to price later Monday, September 18.

The bonds, which are all benchmark size, consist of 4.25-year, 6-year and 11-year terms, making the deal at least a total of $1.5 billion. All bonds are callable a year before maturity. This bond sale marks the inaugural issuance from the holding company since the government-orchestrated takeover of Credit Suisse, during which Credit Suisse's additional tier 1 bonds were controversially eliminated.

In addition to this bond sale, UBS has also been exploring its first additional tier 1 bond since the takeover and wipeout. UBS CEO Sergio Ermotti mentioned last month that issuance may occur when deemed "appropriate". Earlier this month, UBS sold a $3 billion, three-part offering through its London branch.

While UBS continues to navigate changes post-takeover, including potential job cuts for former Credit Suisse employees, it is also welcoming new staff members. Amelie Lonergan Vassort joined UBS in New York this month as head of prime brokerage sales. Vassort previously worked at Morgan Stanley (NYSE:MS) in the same capacity.

However, not all former Credit Suisse employees have found a new home within UBS. Alex Tyo, who spent 13 years at Credit Suisse in New York as MD and head of US rates flow structuring, recently joined BNP Paribas (OTC:BNPQY) as an MD in the rates solutions and structuring team.

UBS's decision to hire Vassort aligns with their inability to recruit from Credit Suisse's prime sales team, which was shut down following the Archegos incident. Despite a challenging year for rates, banks such as Santander (BME:SAN) and BNP Paribas are strengthening their teams, indicating that UBS could have potentially hired Tyo for its rates flow structuring team if it had chosen to do so.

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