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Union Bank of Switzerland

Union Bank of Switzerland
Acquired
Industry Banking
Financial services
Investment services
Fate Merged with Swiss Bank Corporation to form UBS
Predecessor Bank in Winterthur (est. 1862)
Toggenburger Bank (est. 1863)
Successor UBS
Founded 1862
Defunct 1998
Headquarters Zurich, Switzerland
Total assets IncreaseCHF416 billion (1996)
Number of employees
29,100 (1996)

Union Bank of Switzerland (UBS) was a large integrated financial services company located in Switzerland. The bank, which at the time was the second largest bank in Switzerland, merged with Swiss Bank Corporation in 1998, to become UBS to form what was then the largest bank in Europe and the second largest bank in the World.

UBS was formed in 1912 through the merger of the Bank in Winterthur and Toggenburger Bank, both founded in the early 1860s. UBS then continued to grow through acquisitions, including Aargauische Kreditanstalt in 1919, Eidgenössische Bank in 1945, Interhandel Basel in 1967, Phillips & Drew in 1986, and Schröder, Münchmeyer, Hengst & Co. in 1997 among others.

The historical UBS logo features a horizontal acronym "UBS" referring to the "Union Bank of Switzerland", "Union de Banques Suisses" or "Unione di Banche Svizzere". The vertical acronym "SBG" refers to the name of the bank in German "Schweizerische Bankgesellschaft". "UBS" ceased to be considered a representational abbreviation for the Union Bank of Switzerland after the bank's 1998 merger with Swiss Bank Corporation and is today considered a standalone brand.

By the 1980s, the bank had undertaken a major push into the securities business internationally. The bank established a position as a leading European underwriter of Eurobonds and pulled off a major coup in 1985 by pricing a large bond offering for Nestlé, Rockwell, IBM, and Mobil at below market rates.

The bank also made two major acquisitions in 1986, first it purchased Phillips & Drew an established British brokerage and asset management firm, founded in 1895. However, UBS initially had issues integrating Phillips & Drew. The firm lost £15 million when a rush of orders overwhelmed the firm’s settlement system in 1987. Then the bank lost £48 million as a result of Philips & Drew positions in the . Between April 1987 and February 1988, UBS was required to spend as much as £115 million to shore up Phillips & Drew. Phillips & Drew unit returned to profitability in 1992 after years of losses. UBS also expanded into West Germany, acquiring Deutsche Länderbank in 1986.

In 1991, UBS made its first acquisition in the United States, purchasing Chase Investors Management Corporation, the asset management business of Chase Manhattan Bank. Chase Investors, which was established in 1972, was subsequently folded into UBS Asset Management after the acquisition. At the time of the acquisition, which resulted in approximately US$100 million for Chase, the business managed in excess of US$30 billion in public and private pension plans, as well as various financial assets of corporations, governments, foundations and endowments.


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