UBS raises rogue equity trade losses to $2.3 billion
By Emma Thomasson and Silke Koltrowitz
ZURICH (Reuters) - Swiss bank UBS increased the amount it said it had lost on rogue equity trades to $2.3 billion on Sunday and Chief Executive Oswald Gruebel said the alleged fraud would have consequences for strategy and possibly also for himself.
"It is obvious that these incidents will have an influence on the strategy of the investment bank," a visibly chastened Gruebel told Swiss television, adding that the firm would present a new strategy for its investment bank soon.
"I will bear all the consequences of the incident. They will be announced as soon as we put them in practice," he said.
UBS stunned markets on Thursday when it announced unauthorised trades had lost it some $2 billion. London trader Kweku Adoboli was charged on Friday with fraud and false accounting dating back to 2008.
UBS said in a statement on Sunday the trader concealed "unauthorised speculative trading in various S&P 500, DAX, and EuroStoxx index futures over the last three months" by creating fictitious hedging positions in internal systems.
"The loss arising from this matter is $2.3 billion. As previously stated, no client positions were affected," it said.
Global stock markets have been extremely volatile in recent months, plunging on concerns over euro zone and U.S. debt crises and then rebounding on hopes for their resolution.
BUCK STOPS WITH GRUEBEL? Continued...