Tuesday, April 14, 2009

Swiss Bank UBS To Cut 8700 Jobs To Return To Profitability

. Tuesday, April 14, 2009

By stockOzone team

Switzerland's biggest bank UBS AG (UBS) needs time to return to profitability, UBS Chief Executive Oswald Gruebel said Wednesday, announcing a new round of cost cuts.

"It will be a long road back to success without any quick fixes," Gruebel said in a speech made available before the company's general meeting later Wednesday.

The news came as the bank announced it had lost about 2bn Swiss francs ($1.75bn; £1.2bn) in the first three months of 2009.

UBS has been one of the biggest banks hit by exposure to the sub-prime loans crisis in the US and ensuing turmoil.

The Swiss bank is also being probed by the US authorities over alleged fraud and tax evasion involving US citizens.

"UBS seeks to realise substantial cost savings in all areas. Major job cuts are unfortunately unavoidable. UBS expects to reduce the number of its employees to about 67,500 in 2010," said the bank, which employed 76,200 people at the end of March.

The announcement came ahead of the bank's annual shareholder meeting.

The world financial downturn has already forced UBS to make about $50bn in write-downs and to announce 11,000 job cuts since the middle of 2007.

Meanwhile the bank remains embroiled in talks with the US authorities over tax issues.

In February, UBS agreed to pay $780m (£525m) to the US government to settle allegations that it had defrauded US tax authorities.

UBS will detail its first-quarter quarter results May 5.

Disclosure: Author does not own any of the stocks discussed here.

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