UBS is no longer the custodian bank for the AHV/IV/EO compensation fund of the federal government, as reported by the «TagesAnzeiger.» This means the combined major bank is losing a prestigious mandate, involving more than 40 billion Swiss francs.

Change to Be Completed This Year

UBS held the mandate for 26 years. Now, the Boston-based State Street Bank has been commissioned. Specifically, the Zurich branch of State Street's Munich office will be the new trustee. The transition is underway and is expected to be completed in the third quarter of this year, according to the report.

The decision was made by the board of directors of Compenswiss last December. Apparently, technical aspects and pricing were the decisive factors. The tender process lasted about two years.

Swiss Assets to Remain with UBS

The fact that the AHV is now entrusting its securities to a US-based bank might also spark political discussions. However, Compenswiss sees no problem with this arrangement. In a statement to Tamedia newspapers, the federal public-law institution based in Geneva stated: «The custodian bank has a purely administrative function. It selects the sub-custodians where the assets are actually deposited and ensures uniform reporting and a unified view of the assets. Domestic assets remain in Switzerland, while foreign assets remain abroad. A custodian bank appoints a sub-custodian in (almost) every country. For State Street, the sub-custodian in Switzerland is UBS, so all our Swiss assets remain with UBS.»