UBS Group AG (UBS) is moving to retire a large swath of debt inherited from its emergency takeover of Credit Suisse, launching nine concurrent cash tender offers that could total roughly $6 billion if holders tender all eligible notes. The Zurich-based lender announced the buyback program on September 2, with an expiration date of September 10 at 5:00 p.m. Eastern time.

Shares of UBS fell 2.84% to $54.14 on the announcement and slipped another 0.15% to $54.07 in pre-market trading the same day, extending losses as investors digested the scope of the liability management exercise.

The tender offers are split into two groups. Three of the nine offers are structured on an any-and-all basis, meaning UBS will accept every note validly tendered regardless of how much principal is submitted. These cover a £750 million note due 2033, a $697.1 million note due 2028, and a $2.25 billion note due 2028. The remaining six offers carry a combined purchase cap of $2 billion, with acceptance priority levels from one through six determining the order in which UBS will buy back tendered securities.

Breakdown of the Any-and-All Offers

SecurityPrincipal OutstandingMaturity6.442% Fixed/Floating Senior Callable Notes$697.1 million20284.282% Senior Notes$2.25 billion20287.375% Fixed Rate Reset Senior Callable Notes£750 million2033

Note: UBS will calculate each purchase price using the yield of a specified reference security as quoted on Bloomberg at 10:00 a.m. Eastern time on September 10, plus a fixed spread unique to each series.

Maximum-Purchase Offers

The six capped offers span dollar, euro, and sterling debt with outstanding principal ranging from £450 million to $3 billion. The highest-priority series is the 9.016% fixed/floating rate senior callable notes due 2033, followed by a 6.537% note due the same year. Lower-priority securities include a 7.750% fixed rate reset note due 2029, a 3.869% note due 2029, a 2.125% fixed rate reset note due 2029, and a 4.194% note due 2031.

The $2 billion cap excludes accrued coupon payments, which UBS will pay separately in cash to holders whose notes are accepted. The bank may reject lower-priority series if earlier acceptances consume the available capacity, though it also reserves the right to skip a priority level and purchase a lower-priority series in full if doing so fits within the cap.

Legacy Credit Suisse Debt

All nine note series were originally issued by Credit Suisse Group AG before its forced merger into UBS. When the transaction closed on June 12, 2023, UBS assumed Credit Suisse’s obligations as issuer by operation of law. The tender program therefore targets inherited liabilities that have been sitting on UBS’s balance sheet since the state-brokered rescue.

UBS said the offers are part of its proactive management of funding and total loss-absorbing capacity, among other objectives, to optimize interest expense. The bank also indicated it plans to continue issuing senior unsecured debt across major currency markets independent of the tender program, with such issuances potentially running concurrently or following in the near future.

The transaction carries no minimum principal requirement and is not conditioned on new financing. Each offer is independent, meaning UBS may modify, extend, or terminate any individual offer without affecting the others. Settlement is expected on September 14, two business days after the expiration date.

Holders whose notes are accepted will receive the applicable total consideration plus accrued and unpaid interest from the last interest payment date up to, but excluding, the settlement date. Interest will cease to accrue on the settlement date for all accepted notes.

UBS Investment Bank is serving as dealer manager for the offers. D.F. King & Co., Inc. is acting as information agent and tender agent for the dollar-denominated offers, while UBS AG is the tender agent for the non-dollar offers.

The buyback gives UBS a direct tool to reduce funding costs and streamline the capital structure it absorbed through the Credit Suisse acquisition. By targeting higher-coupon legacy notes and replacing them, where needed, with new issuance at prevailing market rates, the bank can lower its overall interest burden while managing its regulatory loss-absorbing capacity requirements.