UBS under investigation by UK, Swiss regulators following rouge trading loss
23 Sep 2011
Elaborating on UBS AG's plans last year, the Swiss bank chief Oswald Gruebel told investors that the bank knew what it was doing and that risk was its business.
However 10 months down the line, Switzerland's biggest bank revealed a $2.3-billion loss from what it called "unauthorised trading." Yesterday, Kweku Adoboli, a 31-year-old trader at the company, appeared in court in London facing charges of fraud and false accounting.
The bank is now under investigation by UK and Swiss regulators with investors and politicians calling for a scale back of its investment bank.
According to industry experts the bank's reputation was at its lowest and another mistake could damage its reputation for good.
Gruebel, 67, was hired out of retirement for stabilising the lender, the flagship for Switzerland's wealth-management industry, after bets on US mortgage-backed securities bombed. The bank reported the biggest loss in Swiss corporate history and had to be bailed out with a 6 billion Swiss francs ($6.6 billion) injection from the government.
East Germany born, Grueber, spent 37 years at Credit Suisse Group AG, earning the moniker "Saint Ossie" for helping restore its profit and reputation, and for early spotting of the US sub-prime debacle.
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