UBS Courts New Investors with Rated Private Credit Deal as US Wealth Unit Bleeds Advisors
Published on 07/20/2026 at 02:53 | Redaktion boerse-global.de
The Swiss banking giant is engineering a rare combination: turning illiquid private credit positions into investment-grade bonds. UBS plans to bundle stakes in private credit funds into notes carrying an A2 rating from Moody’s, backed by a credit guarantee from US insurer Nationwide Mutual Insurance. The move mirrors similar structures being pursued by Partners Group and Cantor Fitzgerald, and it opens the door to a broader pool of institutional investors who are otherwise barred from direct exposure to private credit. While the securitisation promises capital efficiency, critics warn that the layering of guarantees and tranches could mask risks in ways reminiscent of earlier credit booms – a pattern that has drawn scepticism from market observers.
In parallel, UBS is facing an unwelcome distraction in its core wealth franchise. Hundreds of advisors have walked out of the bank’s US business, a development that became public on 19 July. The scale of the exodus, though unexplained in detail, signals a significant disruption in a division that relies heavily on talent retention to drive client relationships. For a bank that generates a large portion of its earnings from managing the assets of wealthy individuals, the loss of experienced advisors is a vulnerability that investors will watch closely in coming quarters.
Despite the advisory turmoil, UBS shares have held up well. The stock closed at €46.13 on Friday, down 1.43% on the day but still up nearly 16% since the start of the year. The 52-week high of €48.19 was touched just days earlier on 16 July, leaving the current price about 4.3% below that peak. The forward price-to-earnings ratio of roughly 19 is close to the highest level seen in the past twelve months, suggesting the market is already pricing in the bank’s growth initiatives – including the foray into structured credit – at a premium.
Should investors sell immediately? Or is it worth buying UBS?
Institutional confidence appears intact. SEB Asset Management opened a new position of 1,159,090 UBS shares during the first quarter of 2026, worth approximately $44.3 million. Mediolanum International Funds increased its stake by 8.8% in the same period, now holding 588,312 shares valued at roughly $21.7 million. The average analyst recommendation on UBS stands at Hold, and the median price target of $60.30 leaves considerable upside from current levels.
The two narratives – a push into complex credit products and a talent drain in a key market – paint a picture of a bank in transition. UBS is seeking high-margin growth outside traditional banking while grappling with personnel challenges in its very bedrock wealth management business. Whether the private credit securitisation proves a successful new revenue stream or a source of hidden risk, and whether the advisor departures turn out to be an isolated incident or the start of a broader trend, will help determine the bank’s earnings trajectory in the quarters ahead.
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