Wednesday, May 07, 2008

Rich clients deserting wealth management businesses

“UBS cuts 5,500 jobs after £5.5bn quarterly loss”

UBS cut 5,500 jobs and sold $15 billion (£7.6 billion) worth of damaged assets yesterday, shares in Switzerland’s biggest bank fell by more than 4 per cent amid fears that restructuring would wreak further havoc

The bank added to investors’ woes by revealing that rich clients were deserting its wealth management business and business banking clients in its home market had pulled almost SwFr2 billion (£960 million) from their accounts in the first quarter

Job cuts include 2,600 staff from UBS’s investment bank, which ran up most of the group’s $37.4 billion in credit crunch writedowns. Fewer than 900 jobs are expected to be lost from the investment bank in London, where UBS employs about 9,000 people. Marcel Rohner, the chief executive indicated that the worst of the staff cull was over.

UBS said that it had agreed to sell a $15 billion book of sub-prime mortgages to BlackRock, the asset management group. The mortgages had already slumped in value from $22 billion, the bank said.

Source: Times Online


Anonymous said...

It was inevitable, sub-prime is a result of mis-management, people was always going to be causalties, many more banks experiencing turmoil maybe they'll sort in-house issues before jumping on the band wagon

Anonymous said...

Its frightening to know that all the big banks did not have a contingency plan. Dealing with billions on a daily business is there business, so why did so many of them not have risk models in place, its negligence

Anonymous said...

5500 is a lot of people on the market where will they go, what will they do next, I would hate to be in these people shoes

James (about to be culled) said...

Would you trust the process again? I know I wouldn't ... Banks got greedy talk about KYC, they did the opposite, taking their eyes of the task, leaving it up to others to think for them