British banking jobs at risk as UBS announces plans to cut 10,000 jobs worldwide
Tuesday 30 October 2012
More British banking jobs were at risk today after UBS said it is to cut up to 10,000 roles worldwide in moves to shrink its investment banking arm.
The Zurich-based bank plans to reduce its headcount from 64,000 to 54,000 by 2015, with some 75% of the losses made outside Switzerland.
UBS, which has around 6,500 staff in London, said the restructuring would deliver savings of 5.4 billion Swiss francs (£3.5 billion) by 2015.
The bank, which wants to shift focus away from investment banking operations, reported a 40% slide in pre-tax operating profits to 2.3 billion Swiss francs (£1.5 billion) in the six months to June 30.
UBS wants to concentrate on its traditional strengths in advisory, research, equities, foreign exchange and precious metals and exit other business lines, mainly in fixed income.
The bank said these divisions had been "rendered uneconomical by changes in regulation and market developments".
The job cuts will target "front-to-back processes" across the bank, UBS said, and simplify its product portfolio and production processes.
Group chief executive Sergio Ermotti said: "This decision has been a difficult one, particularly in a business such as ours that is all about its people.
"Some reductions will result from natural attrition and we will take whatever measures we can to mitigate the overall effect. Throughout the process we will ensure that our people will be supported and treated with care."
The bank announced the plans as part of its third-quarter results, which revealed a loss of 2.2 billion Swiss francs (£1.4 billion) in the three months to September, compared with a profit of 1 billion Swiss francs (£670 million) last year.
The loss was driven by a one-off charge of 3.1 billion Swiss francs (£2 billion) linked to the restructuring of its investment banking division and a debt-related charge of 863 million Swiss francs (£574 million), UBS said.
Unveiling its half-year losses in July, UBS claimed that the botched stock market listing of social networking giant Facebook cost it 349 million Swiss francs (£227 million).
It blamed the loss on the "gross mishandling" of the flotation by Nasdaq, which involved a series of technical errors that caused a delay in the start of trading of Facebook shares in May.
A former UBS banker, Kweku Adoboli, yesterday denied being a rogue trader when he lost the bank £1.4 billion.
The 32-year-old is currently on trial at London's Southwark Crown Court, accused of gambling away the money while working for UBS during the global financial crisis.
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