10,000 investment bank jobs to be cut by UBS
UBS to cut up to 10,000 investment bank jobs
UBS is to scale back its investment bank in a move that could cost up to 10,000 jobs, according to sources.
By Louisa Peacock
11:35PM BST 26 Oct 2012
Switzerland’s largest bank is planning to move parts of its fixed income-trading business into a non-core unit, which would see the size of its investment bank shrink, it is understood.
The bank is expected to unveil the plans when it reports third quarter results on October 30.
Sergio Ermotti, the chief executive, is overhauling the bank following pressure from Swiss regulators to downsize trading operations. The company is already cutting risk-weighted assets at its investment bank by more than half from September 2011 levels.
Mr Ermotti, drafted in last year in the wake of a scandal over an alleged rogue trader, is attempting to cut production costs across the bank’s businesses. Splitting the investment bank would lead to another reduction in risk-weighted assets of up to SFr100bn (£66.4bn) and would lead to the loss of as many as 10,000 jobs across the group’s back office.
The cuts are likely to occur over several quarters, but specific numbers are unclear as the impact of the changes is yet to be determined.
The non-core operation would be headed by Carsten Kengeter, current co-head of the investment bank, and is expected to be wound down over time, people with knowledge of the matter said.
The job cuts could amount to about 16pc of the bank’s workforce — UBS had 63,250 employees as of the end of June.
UBS declined to comment.