We remember: The Swiss Federation and the Swiss National Bank (SNB) decided in October 2008 to save UBS – in reality it may have been UBS who decided that it was to be saved -by transfering USD 60 bln worth of toxic assets to a specially created SIV, named StabFund, to be handeled by the SNB. The Swiss Federation was to lend UBS an amount of CHF 6 bln in form of convertible debentures, to prop up UBS’s tier 1 capital.
The transfer of the toxic assets to the SNB StabFund was done in two tranches. The first of which was transfered in December 2008. The second tranche was transfered in April 2009. In total, assets worth USD 38.7 bln were transfered, according to the scond SNB press release above.
This part of the deal was financed by the SNB by issuing short-term debt in USD, as announced on Feb. 2 2008. I guess, this answers Edwards Feb. 2 question on Credit Writedown.
The approximate compositions of the assets transfered can be seen in a message to the shareholders who had to approve both the transfer of assets as well as the issuing of convertibel debentures to the Swiss Federation.
Here is the table from the message:
