View more on these topics

Nordbank to sue UBS for imprudent CDO management

Swiss banking giant UBS is set to be the first big lending name to be sued for the mis-selling of millions of dollars’ worth of investments linked to sub-prime mortgages.

Germany’s HSH Nordbank is looking to recover what it calls significant losses on a $500m (£253m) portfolio it bought in 2002.

Nordbank alleges that UBS did not manage the assets in line with Nordbank’s prudent investment objectives.

Record default rates on US sub-prime mortgages have caused pro-blems for many banking insti- tutions around the world.

US banks repackaged their debts into products known as collateralised debt obligations which were then sold on to other banks.

If Nordbank is successful in recovering its money there could be a wave of similar legal actions from other banks and investors who claim not to have been made aware of how risky CDOs were. It plans to file its suit in New York by the end of the month.

UBS declined to comment.

Recommended

S&S new centre

Stroud & Swindon Building Society has opened a new contact centre in Gloucester Business Park near Gloucester.

Rate hikes add to first-timers’ woes

Nationwide has ramped up the rates on its 75% and 90% LTV deals by 0.2%.This is a further blow for first-time buyers following the withdrawal of all 125% LTV products from the market.Nationwide’s two-year fixed rate 90% LTV deal has been increased from 6.25% to 6.45% with no reservation fee.Its two-year 95% LTV fixed rate […]

Housing minister to unveil eco-towns shortlist

Housing minister Caroline Flint will be releasing the shortlist of eco-towns sites within the next few weeks.The zero-carbon towns, proposed early last year, would create more affordable housing and be built on brownfield land.Over 50 plans have been considered by the government and Flint says the first short list will come under robust and transparent […]

FSA says it will stick to principles

Financial Services Authority chief executive Hector Sants says that the recent market turbulence and problems at Northern Rock will not affect its commitment to principles-based regulation.

The investment clock

While Trump blazes blond in the political foreground, it’s easy to overlook the economic background to the new political dimension of 2017. Political risk will be a feature of the year: the unpredictable and untested Trump administration has already created uncertainty, which is unlikely to diminish, especially if protectionist rhetoric starts to outweigh promises of […]

Newsletter

News and expert analysis straight to your inbox

Sign up