UBS AG, the European bank with the biggest losses from the credit crisis, plans to eliminate about 1,900 jobs in its investment banking, equities and fixed income units, two people with knowledge of the matter said.
The bank may announce the plans at today’s shareholder meeting, said the sources, who declined to be identified because they weren’t authorized to discuss the cuts, which would amount to about 10 percent of the total investment banking staff.
Support staff jobs will also go, the sources said. Rohini Pragasam, a UBS spokeswoman in New York, declined to comment.
UBS, Switzerland’s biggest bank, is scaling back its investment banking unit, which it plans to separate from wealth and asset management after mounting writedowns prompted rich clients to withdraw funds for the first time in almost eight years. The cuts add to the 7,000 already announced by Zurich-based UBS, and would bring to more than 131,700 the total number of jobs eliminated at banks worldwide since July of last year.
“It is unquestionably the worst hiring climate I’ve seen in 30 years in the city for the European markets,” said Shaun Springer, chief executive officer of Napier Scott Executive Search Ltd in London.
UBS rose 4 percent to 19.19 Swiss francs (US$17.21) at 10:35am in Zurich trading. The bank has dropped 58 percent so far this year, paring its market value to about 56 billion Swiss francs.
UBS has taken writedowns and credit losses of US$44.2 billion since the credit crisis began last year, more than any other European bank.
Chief executive officer Marcel Rohner and chairman Peter Kurer, trying to stem client redemptions and record share price declines, will brief shareholders today on efforts to scale back the investment bank and overhaul the board. UBS is scheduled to report detailed third-quarter earnings on Nov. 4.
Lehman Brothers Holdings Inc, the securities firm that filed for bankruptcy two weeks ago, on Tuesday eliminated 750 jobs in its European fixed income and personal investment management units after talks to find a buyer failed. Nomura Holdings Inc, Japan’s biggest securities firm, agreed to buy Lehman’s European investment banking and equities units in Europe along with its Asian-Pacific unit. London-based Barclays PLC purchased Lehman’s US investment banking unit for US$250 million.
European governments have come to the rescue of five banks this week as the worst financial crisis since the Great Depression spreads beyond the US.
Belgium, the Netherlands and Luxembourg agreed to inject 11.2 billion euros (US$15.8 billion) into Fortis for minority stakes, while Belgium and France led a 6.4 billion euro bailout of Dexia SA. Bradford & Bingley PLC was seized by the UK government, Iceland’s Glitnir Bank hf was bailed out by the country’s Financial Supervisory Authority and Germany’s Hypo Real Estate Holding AG received a government loan guarantee.
STILL COMMITTED: The US opposes any forced change to the ‘status quo’ in the Strait, but also does not seek conflict, US Secretary of State Marco Rubio said US President Donald Trump’s administration released US$5.3 billion in previously frozen foreign aid, including US$870 million in security exemptions for programs in Taiwan, a list of exemptions reviewed by Reuters showed. Trump ordered a 90-day pause on foreign aid shortly after taking office on Jan. 20, halting funding for everything from programs that fight starvation and deadly diseases to providing shelters for millions of displaced people across the globe. US Secretary of State Marco Rubio, who has said that all foreign assistance must align with Trump’s “America First” priorities, issued waivers late last month on military aid to Israel and Egypt, the
France’s nuclear-powered aircraft carrier and accompanying warships were in the Philippines yesterday after holding combat drills with Philippine forces in the disputed South China Sea in a show of firepower that would likely antagonize China. The Charles de Gaulle on Friday docked at Subic Bay, a former US naval base northwest of Manila, for a break after more than two months of deployment in the Indo-Pacific region. The French carrier engaged with security allies for contingency readiness and to promote regional security, including with Philippine forces, navy ships and fighter jets. They held anti-submarine warfare drills and aerial combat training on Friday in
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CHANGE OF MIND: The Chinese crew at first showed a willingness to cooperate, but later regretted that when the ship arrived at the port and refused to enter Togolese Republic-registered Chinese freighter Hong Tai (宏泰號) and its crew have been detained on suspicion of deliberately damaging a submarine cable connecting Taiwan proper and Penghu County, the Coast Guard Administration said in a statement yesterday. The case would be subject to a “national security-level investigation” by the Tainan District Prosecutors’ Office, it added. The administration said that it had been monitoring the ship since 7:10pm on Saturday when it appeared to be loitering in waters about 6 nautical miles (11km) northwest of Tainan’s Chiang Chun Fishing Port, adding that the ship’s location was about 0.5 nautical miles north of the No.
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