UBS revises profit down after settling lawsuit, ups CEO pay
By Joshua Franklin and Jonathan Stempel
ZURICH (Reuters) - UBS AG UBSG.S on Friday lowered its previously reported net profit for 2014 after reaching a $135 million settlement of litigation in which investors accused Switzerland's largest bank of colluding with rivals to rig the foreign exchange market.
In its annual report, UBS reduced its fourth-quarter profit by 105 million Swiss francs ($104 million) and boosted its litigation reserves to 3.05 billion Swiss francs ($3.03 billion).
"The principal change arose due to an increase in charges for provisions for litigation, regulatory and similar matters of 134 million francs," the Zurich-based bank said.
UBS is now reporting total 2014 net profit of 3.466 billion francs ($3.45 billion), down from 3.571 billion francs it reported in February.
The $135 million settlement resolves antitrust claims by hedge funds, pension funds and other investors that UBS impeded competition in the currency markets by conspiring to manipulate the WM/Reuters Closing Spot Rates, known as the Fix, in chat rooms, instant messages and emails.
JPMorgan Chase & Co (JPM.N: Quote), the largest U.S. bank, in January agreed to pay $99.5 million to settle.
Ten other banks were sued. Michael Hausfeld, a lawyer for the investors, said talks about future settlements were ongoing.
Switzerland's two biggest banks have now revised down fourth-quarter earnings. Continued...