Swiss banking giant UBS Group (UBS) has announced that it is selling its 50% stake in credit card provider Swisscard to American Express (AXP).
UBS had inherited the stake in Swisscard through its acquisition of former bank rival Credit Suisse, which it is in the final stages of completing. UBS agreed to acquire Credit Suisse in 2023 for more than $3 billion after that bank failed.
Now, UBS is selling its 50% ownership stake in Swisscard to U.S. credit card company American Express. Amex, as the company is often called, was already the joint venture partner in Swisscard, and the sale makes it the sole owner of Swisscard. Financial terms of the deal were not made public.
Divesting Parts of Credit Suisse
Swisscard will continue to issue all its current credit cards, not only from American Express but also Mastercard (MA) and Visa (V). Swisscard said that there should be no impacts to current cardholders, merchants, or partners, and there is no need for any action by cardholders because of UBS selling its stake to Amex.
This is not the first part of Credit Suisse to be divested by UBS. Earlier this year, UBS sold its stake in Credit Suisse Securities (China), and it has agreed to sell an insurance-linked investment arm of the former bank. UBS stock has gained 8% so far in 2024.
Is UBS Stock a Buy?
UBS stock has a consensus Moderate Buy rating among 11 Wall Street analysts. That rating is based on five Buy, five Hold, and one Sell recommendations made in the last three months. The average UBS price target of $33.32 implies 3.01% upside potential from current levels.
