UBS had trading briefly halted in the US as shares in the bank tumbled following a Department of Justice (DoJ) probe into Russian clients avoiding sanctions.
A full-scale investigation is now underway into what was going on at its newly-acquired subsidiary Credit Suisse, according to Bloomberg, and if there were any significant compliance failures.
Shares have since resumed trading but the price in New York is down around 3.5% at US$24.20.
BREAKING: The US Department of Justice escalates a probe into Credit Suisse and UBS over suspected failures that allowed Russian clients to evade sanctions https://t.co/rtkd0EsX1j pic.twitter.com/qbeiOA4XaJ
— Bloomberg Markets (@markets) September 27, 2023
Since August, shares in the bank have fallen by around 20% as concern that the scope of the DoJ probe has increased.
US-based lawyers working for UBS have reportedly been briefed by DoJ lawyers over sanctions violations at Credit Suisse.
UBS bought its troubled rival in June in a hugely controversial move brokered by the Swiss government that saw equity investors take precedence over some classes of bond for the first time.