UBS plans to explain to its shareholders why it has chosen the strategy pursued in the tax dispute with France, according to media reports. Will this help its share price recover?
Switzerland’s biggest bank on October 22 will not only publish its third-quarter report, but also take the opportunity to present a white paper about the tax dispute in France.
Zurich-based UBS hopes to show that its strategy is suitable to promote the wellbeing of bank and investors alike, said «Handelszeitung» in a report. finews.com in May had written that the bank expected the key to winning in the high-stakes appeal was regaining control of its own narrative. The white paper will be a first step in doing just that.
Feverish Activities
In the legal dispute with France, a Paris court decided in February that UBS should pay a total of 4.5 billion euros to compensate for helping wealthy French citizens avoid paying taxes. UBS has lodged an appeal against the verdict.
The bank’s communications department and the legal team of chief counsel Markus Diethelm have been working on the white paper for weeks. The document will provide a detailed account of the tax dispute.
Uncertainty Weighing on Share Price
The work on the paper will also help the bank prepare for the appeal process, which will begin with a first hearing in November in Paris. The appeal will be considered over the course of the first half of 2020, the state attorney told the Swiss newspaper.
Time will tell whether the white paper is going to help the bank reverse the decline of its share prices. Since the February verdict, the bank has lost some 9 billion francs ($9.1 billion) in value as measured by its stock price. Part of the decline will likely have come as a reaction to the uncertainty surrounding the legal dispute and the length of the procedure.
