UBS is to cut 2,000 more jobs as it pushes ahead with a tough restructuring after posting the biggest annual loss ever for a Swiss firm, although it said client withdrawals had stopped in January.
UBS reported a 8.1 billion Swiss franc ($7 billion) net loss in the fourth quarter, missing a Reuters poll forecast for 7.1 billion. UBS's loss for 2008 came in at 19.7 billion Swiss francs, above analysts' predictions for 18.7 billion francs.
The quarterly loss today came on the back of a hefty 8.8 billion Swiss franc trading loss, as well as charges it made after selling billions in toxic assets to the Swiss National Bank when it was rescued by the state in October.
Chief executive officer Marcel Rohner told journalists that Switzerland's largest bank was still aiming to return to profit in 2009 after seeing some positive signs in the business environment at the start of this year.
“UBS has had an encouraging start to the year,” UBS said in a statement. “However, financial market conditions remain fragile as company and household cash flows continue to deteriorate... Our near-term outlook remains cautious.”
UBS continued to suffer massive outflows in the fourth quarter at its core wealth management business. But the Swiss bank said net new money had turned positive in both wealth management and asset management in January, the first time after a streak of negative quarters. It did not give details.
“Net new money for January looks good,” said Jeremy Sigee, an analyst at Citigroup. Mr Rohner said UBS will not pay a dividend for 2008.
UBS also announced structural changes to refocus the bank on its core Swiss businesses, its global wealth management operation - the world's biggest - and on the growth potential of its onshore business.
UBS said it is creating two new business divisions: Wealth Management & Swiss Bank under the leadership of Franco Morra and Juerg Zeltner, and Wealth Management Americas, led by Marten Hoekstra. All three are members of the board.
UBS also said it was continuing to cut the size of its troubled investment bank, saying it aimed to bring its total staff to about 15,000 from 17,171 now.
Reuters