UBS AG will close its business of underwriting municipal debt after being unable to sell it, making it one of the highest-profile investment banks on Wall Street to leave the market in 20 years.
Last month, Jerker Johansson, chief executive of UBS' investment bank, said the company was getting out of the institutional muni business. UBS' wealth-management operations will continue to offer municipal securities to its clients, and the firm will move its secondary market trading desks into the wealth-management division.
UBS said explored a number of alternatives to exit the business but "because of the complexities of selling the business in the current market and limited market capacity for a business of this size, a sale of the business was unlikely in the near term."
UBS said the move was part of its efforts to reposition its fixed income, currencies and commodities business to focus on core business areas.
UBS expects to complete its exit from the business in the next few months. Through early May, the company was fourth in muni underwriting, according to Thomson Reuters.
UBS's shares recently traded at $25.25, up $1.48, or 6.2%.
