ZURICH (Reuters) - U.S. bank State Street (NYSE:STT) has won a mandate to act as custodian bank for a multibillion-dollar compensation fund of the Swiss federal government that was previously at UBS, authorities said on Wednesday.
The decision to hand the AHV/IV/EO fund to State Street was made in December after a two-year tender process and the transfer should be completed by the end of this year, according to Compenswiss, a federal body managing the public pension fund.
The fund is worth more than 40 billion Swiss francs ($44.48 billion), and according to Swiss newspaper Tages-Anzeiger had been with UBS for 26 years.
In a statement, Compenswiss said the custodian bank does not manage the compensation funds, and fulfils a purely administrative role.
It said a custodian bank appoints a sub-custodian bank in most countries, and that in the case of State Street, that role fell to UBS in Switzerland.
That meant the fund's Swiss assets would remain with UBS, Compenswiss said.
UBS declined to comment on the report.
($1 = 0.8993 Swiss francs)