UBS says Basel preparation will delay dividends

UBS shareholders let out a collective groan yesterday when the bank said it will not issue a dividend until at least 2013, instead opting to preserve capital ahead of tough new Basel III rules.

The Swiss bank has not released funds to its shareholders since 2007 and it will now be at least three years until payments resume.

UBS follows several other lenders who are starting to provide more clarity on the impact of the new rules on bank capital and liquidity, unveiled three weeks ago. Shares in UBS, Europe’s largest wealth manager by assets, fell 1.3 per cent on the back of the news.

Chief financial officer John Cryan said: “The dividend commencement date is a little uncertain. Sometime in the period of Basel III introduction we’ll be able to resume our returns to shareholders in the form of a dividend or even share buyback.

“I’d be expecting by 2013-14 to be in a position where we’re comfortably on track, unless something extraordinary comes out on Monday.”