France wants UBS to pay $5 billion to amend for tax-related misdemeanors. The Swiss bank has therefore increase provisions in relation to the case – but the money would only cover for a fraction of the French demands.
Before today’s publication of the annual report of UBS, it wasn’t known how much money the bank had put aside to cover for all eventualities arising from the dispute with the French. In the report published on Friday, CEO Sergio Ermotti and Chairman Axel Weber write that the number-one Swiss had raised provisions for the French case to 450 million euros ($509 million).
This is exactly a tenth of the total sum the French court demanded from the bank in February, 4.5 billion euros. UBS was convicted of having abetted French citizens to avoid paying taxes and fined 3.7 billion euros as well as ordered to pay 800 million euros in compensation.
Appeal Pending
UBS has appealed the verdict and both Ermotti and Weber argue in the annual report that the court’s findings weren’t supported by any hard evidence and or by an existing legal framework.
In total, UBS added $905 million dollars to the provisions kitty, which now contains $2.5 billion. The bank currently also has a legal case pending in the U.S. in relation to its activities in the U.S. mortgage market.
