Fine for rigging Libor helps push UBS £1.3bn into the red
Tuesday 05 February 2013
The Swiss bank UBS lost Sfr1.9bn (£1.3bn) in the final quarter of 2012 after it was hit with £994m of fines for rigging Libor.
The bank, which is cutting back on investment banking activities and concentrating on wealth management, also reduced its bonus pool for bankers by 7 per cent and said it would pay much of those bonuses in bonds which could lose all their value if the bank got into trouble again. Despite the losses, the bank also launched Sfr5bn of its own bonds, with the chief executive, Sergio Ermotti, saying it could afford to do so because of the way it had reduced the riskiness of its balance sheet. The bank is in the process of cutting 10,000 jobs worldwide. But analysts noted that wealth management saw a much lower inflow of new money in the final quarter than expected, at Sfr2.4bn – less than half forecast.
The business has been hit by withdrawals by EU customers worried about attacks on Switzerland for helping tax avoidance.
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