ZURICH (Reuters) - UBS is still committed to its investment bank, under fire after one of its London traders was charged over a $2 billion loss, the bank’s Chairman Kaspar Villiger told a Swiss newspaper.
UBS trader Kweku Adoboli was charged with fraud and false accounting dating back to 2008 on Friday, prompting criticism of the bank’s control mechanisms and integrated business model.
The strategy of an integrated investment bank focused on client services is the right one, Villiger told NZZ in the interview published on Saturday. He said UBS needed its investment bank and was not considering a sale.
UBS spokesman Serge Steiner said UBS had made it clear in the past that it was committed to the integrated business model. “Mr Villiger has only reiterated this point of view,” he said.
In the article, which did not contain any direct quotes, Villiger also said UBS needed to examine if and how the focus on clients and control mechanisms could further be improved.
The investment bank would have to work with less capital in the future, he said, declining comment on possible personnel changes in the wake of the alleged fraud.
UBS Honorary Chairman Nikolaus Senn told Swiss television on Friday that he did not believe Chief Executive Oswald Gruebel would be able to resist the pressure to step down given he and the board had the final responsibility for what was happening at the bank.
“I do not know how often Gruebel flew to London to ask the people in charge how the business was going,” Senn said.
Swiss newspaper Tages-Anzeiger quoted a source close to Gruebel as saying the manager, who has so far been seen as the man who managed the bank’s turnaround after the financial crisis, would not give up that easily.
“Ossi wants to prove he is not the old-fashioned banker unable to learn his lesson that everybody believes him to be,” said the source, described as one of Gruebel’s colleagues.
Reporting by Silke Koltrowitz; Editing by Ruth Pitchford