UBS AG (NYSE: UBS) has reached a $120 million settlement with investors stemming from a lawsuit tied to securities UBS underwrote for Lehman Brothers, the large investment bank that collapsed in bankruptcy at the height of the recent financial crisis.
The suit claimed UBS failed to alert investors to Lehman’s dire financial situation as UBS sold about $900 million of Lehman securities underwritten by UBS between March 2007 and September 2008, when Lehman filed for bankruptcy.
Continue Reading Below
The settlement must be approved by a judge.
A UBS spokesman issued the following statement: “UBS is pleased to have resolved this legacy litigation matter arising out of the 2008 financial crisis. UBS agreed to the settlement to avoid the cost and uncertainty of continued litigation. The full cost of the settlement is covered by litigation provisions established by UBS in 2012 and in prior periods.”
Under the terms of the settlement, UBS did not admit liability.