UBS rushes to reassure plunging markets.

Position:NEWS
 
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UBS shares tumbled almost 30 per cent in the mid-September meltdown that followed the failure of two major U.S. financial institutions, but recovered slightly after saying its exposure to Lehman Brothers would not exceed $300 million (SFr 336 million).

Still, UBS shares fell to SFr 16.64, their lowest level since 1998, reversing a steady recovery from the previous all-time low in July.

"UBS confirms that its direct and counterparty exposures to Lehman Brothers, net of hedges, are now substantially closed out. UBS does not expect the total cost of closing out its exposures to Lehman Brothers to exceed $500 million," the bank said in a statement.

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"The current events in the United States show that it is still too early to say the storm is over," Swiss National Bank Vice-Chairman Philip Hildebrand said in a September speech. Reflecting the overall market, shares in Credit Suisse, rival of UBS, lost 12.7 per cent in the days following the meltdown...

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