UBS reports $11.4 billion Q1 loss, may cut over 8,000 jobs

Switzerland's biggest bank, UBS AG, faced with the biggest credit write-downs for any European bank and a $11.4 billion (12 billion-franc) first-quarter loss, is likely to cut as many as 8,000 jobs.

Zurich-based UBS, which had a 3 billion-franc profit a year earlier, saw its US subprime mortgage-related write-down swell to $38 billion over the past three quarters. UBS is in second place behind New York-based Citigroup Inc, which has written down $41 billion.

Chairman Marcel Ospel, who replaced half of the executive board responsible for building the bank's loss-making debt securities business at the peak of the market, also stepped down last month.

UBS is eliminating between 2,500 and 3,000 jobs in its investment bank, more than 10 per cent of the division. UBS, which is expected to cut a tenth of its 83,000 employees overall, has already cut 1,500 jobs late last year.

UBS, among the first to be hit by the subprime mortgage crisis, had to close its Dillon Read Capital Management LP hedge fund after it  lost 150 million francs in the first quarter of last year. 

The world's top financial companies have announced over $319 billion in write-downs and loan losses. Banks and securities firms have cut about 48,000 jobs in the past 10 months, including 15,200 positions at Citigroup and 5,220 at Merrill Lynch & Co.

Switzerland's second-biggest bank Credit Suisse Group reported a 2.15 billion-franc loss after 5.3 billion francs in write-downs while top German bank Deutsche Bank AG  reported quarterly losses of 131 million euros ($204 million) for the first time in five years for the three months ended in March after a 2.7 billion-euro markdown.