UBS tax deal with U.S. seen as soon as today

From Reuters UBS tax deal with U.S. seen as soon as today Wed Aug 19, 2009 8:38am EDT By Jason Rhodes BERNE (Reuters) - Details of a deal to settle a U.S. tax case against Swiss bank UBS AG could come as soon as Wednesday and could have far-reaching implications for other wealth managers. The lawsuit against UBS, which alleges that it helped U.S. citizens dodge taxes, has strained relations between the U.S. and Switzerland because it challenges the secrecy laws that have long drawn clients to the Alpine nation's banking sector and poses a threat to its wealth management industry. Sources have said UBS, the world's second-largest wealth manager, will hand over details of about 5,000 client accounts after the signing of a deal agreed last week to end a dispute in which U.S. tax authorities originally asked for details on 52,000 clients suspected of tax evasion. "No one is expecting a fine or punitive damages, so the impact on UBS shouldn't be too severe," said Cheuvreux analyst Christian Stark. "The more important implications are for the Swiss banking industry." The deal could be announced on Wednesday, after the first regular meeting of the Swiss cabinet following the summer recess, industry insiders said. The Wall Street Journal reported on Wednesday that wealthy U.S. citizens using a government tax-evasion amnesty program had identified almost 10 European banks where they have accounts, citing people familiar with the situation. The paper named Credit Suisse, Julius Baer, Zuercher Kantonalbank and Union Bancaire Privee (UBP) in the report, though it said the disclosures did not signal any wrongdoing by the banks. Credit Suisse and Julius Baer declined to comment. UBP, Zuercher Kantonalbank and the U.S. Internal Revenue Service could not be immediately reached for comment by Reuters. HERALDING UBS RECOVERY? The U.S. is building criminal cases against more than 150 American clients of UBS as part of a crackdown on tax evasion now made easier by a deal over access to secret account information. But analysts say the deal could clear the decks for a recovery at UBS, which has been battered by the financial crisis and uncertainty caused by the U.S. probe. It could also remove an important obstacle to the Swiss government offloading its 9 percent investment in UBS held as mandatory convertible notes (MCNs). UBS shares were down 2.8 percent at 16.42 Swiss francs at 5:54 a.m. EDT, just behind a 2.5 percent drop in the DJ Stoxx European banks index. Local Swiss rival Credit Suisse was down 2.5 percent and Baer had lost 3 percent. (Additional reporting by Martin de Sa'Pinto and Katie Reid in Zurich; Writing by Sam Cage, editing by Will Waterman) © Thomson Reuters 2009. All rights reserved. Users may download and print extracts of content from this website for their own personal and non-commercial use only. Republication or redistribution of Thomson Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters and its logo are registered trademarks or trademarks of the Thomson Reuters group of companies around the world.

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CNBC is reporting the Treasury will have a statement around 9:30. I will update if and when I find something