Published by Global Banking & Finance Review®
Posted on November 26, 2025
1 min readLast updated: January 20, 2026
UBS may write down credit funds by over 10% due to First Brands' bankruptcy, affecting its O'Connor hedge fund unit.
ZURICH (Reuters) -UBS could mark down credit funds managed by its O'Connor hedge fund unit by over 10% following the bankruptcy of U.S. auto parts supplier First Brands, German business paper Handelsblatt reported on Wednesday, citing sources.
UBS said earlier this month it was winding down investment funds run by its hedge fund unit O'Connor, with the majority of assets expected to be monetised by year-end.
"As a priority, we're taking steps to protect clients' interests and maximize recovery of the remaining First Brands Group-related positions through the complex bankruptcy process," UBS told Reuters when asked for comment on the Handelsblatt story.
(Reporting by Oliver Hirt and Ariane LuthiEditing by Ludwig Burger)
A credit fund is an investment vehicle that primarily invests in debt instruments, such as corporate bonds, loans, and other credit-related assets, aiming to generate returns for its investors.
Bankruptcy is a legal process through which individuals or businesses that cannot repay their debts can seek relief from some or all of their obligations, often resulting in liquidation or reorganization.
Hedge funds are investment funds that employ various strategies to earn active returns for their investors, often using leverage, derivatives, and short-selling to achieve their financial goals.
An investment portfolio is a collection of financial assets, such as stocks, bonds, and other investments, held by an individual or institution to achieve specific financial objectives.
A financial crisis is a situation in which the value of financial institutions or assets drops significantly, leading to a loss of confidence and potentially resulting in widespread economic disruption.
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