UBS Triggers Margin Calls as Russia Bond Values Cut to Zero
- Swiss rival Pictet also cutting value of bonds in portfolios
- Investors who can’t meet calls risk seeing liquidations
The UBS Group headquarters in Zurich, Switzerland.
Photographer: Stefan Wermuth/BloombergThis article is for subscribers only.
UBS Group AG triggered margin calls on some wealth management clients that use Russian bonds as collateral for their portfolios after marking down the value of debt issued by the country and its corporations.
The Swiss wealth manager is calling on some investors to add either cash or securities to their portfolio after cutting the lending value of some Russian bonds to zero, people with knowledge of the matter said. While the sovereign bonds still trade around 50 cents on dollar, and many Russian corporate bonds are well above that, UBS’s move signals it essentially will no longer accept them as collateral.