UBS Group said on Monday that it will pay $300 million to settle lingering obligations tied to a Credit Suisse deal with the U.S. Department of Justice (DOJ) over the sales of residential mortgage-backed securities (RMBS).
UBS inherited the obligations when it acquired Credit Suisse in a 2023 rescue arranged by Swiss regulators. The bank confirmed on Monday that its U.S. Credit Suisse Securities LLC unit entered into the new agreement with the DOJ on Aug. 1, which will result in a credit to third-quarter results for its noncore and legacy business.
The payment will resolve consumer-relief commitments that Credit Suisse agreed to in 2017, when it paid $5.3 billion to end DOJ claims that it misled investors on RMBS in the run-up to the 2008 financial crisis.
That settlement included a $2.5 billion penalty and $2.8 billion in consumer relief.
The deal is part of UBS’s effort to quickly wind down Credit Suisse legal matters. Bloomberg Intelligence previously estimated UBS would pay $500 million in additional costs to settle the remaining legacy Credit Suisse cases.
UBS settled its own RMBS case with the DOJ for $1.4 billion in August 2023, roughly four months after it bought Credit Suisse in a $3.25 billion government-orchestrated transaction.
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