HSH Nordbank Sues UBS Over CDO

HSH Nordbank AG has filed a lawsuit against UBS involving a U.S. mortgage-linked collateralized debt obligation portfolio, alleging breaches of contractual obligations and fiduciary duties that UBS denies. The bank said the suit, filed in New York, pertains to a $500 million CDO that UBS sold to one of HSH Nordbank's predecessors and that UBS arranged and manages. "Our counterparty HSH is a professional and sophisticated market participant," a UBS spokesman said. "These products were tailored to satisfy the counterparty's demands. UBS denies all allegations and intends to defend itself vigorously. UBS invited HSH to discuss a mediation, but HSH refused and instead publicly announced that it wants to take the matter to court."